Why Edtech is not the new Fintech – Industry giants weigh in
In the first quarter of 2016, the Fintech industry boasted an unprecedented global investment of $5.3 billion.1 The Fintech trend shows no signs of slowing down as investors and venture capitalists grapple to find out what’s next.
Enter Edtech: the next digitalised sector poised to disrupt one of the world’s most established industries.
And with a market predicted to grow 17% in the next three years2, it seems almost certain that Edtech will be the next Fintech, following the same path to fast-paced success.
Sam Paddock, co-founder and CEO GetSmarter, isn’t so sure. “The flow of money is very different to the flow of knowledge and I think the way our education system is set up is far more complicated. I think fundamentally education is a different problem to solve and the jobs that need to be done need to be seen through a very specific lens.”
Sam was speaking on a panel of Edtech industry-experts, hosted by the Silicon Cape Initiative. The event invited entrepreneurs and authorities to impart their learnings about the industry and address questions around this disruptive new trend.
He went on to explain that he understands those that wish to stand at the helm of the Edtech wave have a lot to learn from the growth, establishment and expansion of the Fintech boom, but this shouldn’t mislead them in understanding that the different problems each industry faces need to be addressed in very different ways.
“As entrepreneurs, we need to hone in on very specific problems that we are trying to solve in education and then take a specific lens of the jobs that we need to do to solve those problems. I think there’s more work to be done and that is the crux of the difference between the two industries.”
Africa will lead the way for Edtech
Jamie Martin, who heads up Edtech Cluster at CiTi, agreed with Sam but believed there was a significant similarity: “This is an area in which the developing world will lead the developed world. In the same way that with mobile money Africa led the world, I think it’s possible that the people who will really rethink the challenges education faces will come from this part of the world.”
“When things are as bad as they are, there is far more appetite for private sector involvement.”
Sam closed the panel discussion by addressing the fact that entrepreneurs have to understand that, unlike Fintech, technology is not enough to lead Edtech where it needs to go.
He said, “If we were going to solve the problems in education with just technology, we would have done that already. In comparing with Fintech, there is nothing like blockchain at the moment that is having the education community fundamentally quivering.”
He believes that GetSmarter’s human approach to online learning was more reflective of the defining features of successful Edtech ventures. “I think a lot of Edtech entrepreneurs come at this wondering how technology can solve this problem by itself, but actually we found at GetSmarter that involving humans in the process is far more important than the technology itself.”
The panel was made up of Sam Paddock, Jamie Martin, Co-founder of WeThinkCode, Arlene Mulder, and Dr. Tadajeu Ifriky.