Edtech Investment Trends in 2015: More Money, Fewer Deals


Edtech Investment Trends in 2015: More Money, Fewer Deals

May 13, 2015

NEW! KA'CHING QUARTERLY TRENDS: Need to know more than who is funding whom? How about sector trends?

EdSurge has reported on funding of edtech companies since our first days. Now we've done a time-twister move: We've gone back to examine, clean and crunch data on edtech financings for all of 2014 (and 2015, of course). Even better: We've pulled together details on the sectors trending, quarter by quarter. And yes, we'd love you to give you a chance to sift through these numbers, too, in EdSurge's new class of reports, the Ka'Ching Quarterly Trends.

A couple of points that we've observed:

Category Trends: K-12 Investment dollars took a big dip in 2014 between Q3 and Q4. In Q3, $104 million was invested in K-12 across curriculum products, teacher needs and school operations; that number dropped to $43 million in Q4.

Funding Round Trends: In Q3, There were 11 seed and angel deals, 13 Series A deals, 7 Series B deals and 9 other deals. Seed and angel deals decreased 72% relative to Q4 2014, while Series A deals increased by 160%.

Now onto the present: During the first quarter of 2015, edtech companies received $185 million more in funding than they did during the same period last year, even though there were eight fewer deals. The change was driven primarily by the $200 million SoFi deal and the $186 million investment in Lynda.com in January. (Lynda was subsequently snapped up by LinkedIn for a whopping $1.5 billion in April.)

Both these edtech companies operate outside the K12 category. In fact, K-12 investments in the first quarter were down 60%, in terms of funding dollars, versus the first quarter of 2014.

The majority of funding on a dollar basis in Q1 2015 went to Series C+ stage funding, although Series B deals were a close second, with $263 million and $236 million, respectively. Seed, Angel and Series A deals together were under $100 million even though the combination dominated the number of deals (representing 34 investments).

Find more insights into edtech financing trends and the next companies poised to grab market share in the newly launched Ka'Ching Quarterly Trends reports. Each report includes financing trends by company and location, investment breakdown by category and round analysis, as well as competition analysis by edtech category. Get your subscription here!

Learn more about EdSurge operations, ethics and policies here. Learn more about EdSurge supporters here.

More from EdSurge

Get our email newsletterSign me up
Keep up to date with our email newsletterSign me up