There has never been a better time for technology startups the pandemic not with standing. Read to know more
T P Venu
More often than not, when China takes a decision it has some repercussions on India. However, the latest decision by China to ban private investments in education sector, especially in the edtech space augurs well for Indian edtech companies.
What does Xi Jinping-led government’s regulation barring any foreign investment in teaching platforms mean to India? A lot. Firstly, investors would now look to India which is already upward bound with the emergence of 25 new unicorns, a first in this century.
In the new scenario, investors would look to park their capital in the Indian market which according to BARC India and Nielsen report witnessed a 30 per cent increase in the time spent on education apps in the first three months of lockdown.
Secondly, there is a new found enthusiasm globally as India along with the USA and China is the biggest startup market. With China now pulling back from investors, edtech funding would grow even more. According to latest figures, edtech funding grew to $2.2 bn in 2020, compared to $1.8 billion raised by edtech startups with 300-odd deals in five years between 2014-19. The giant leap from 2019-21 is something the world is taking notice. Sample this: This year till date, in 583 deals, a whopping $26.76 billion was raised.
Experts view the latest change wrought by the Chinese as a boon for Indian tech companies to make hay. Global investors are wary of China already which was evident with the funding for Chinese based companies taking a nosedive by 18% in Q2 of 2021. It resulted in $560 billion in market value wiped out off Hong Kong and mainland China exchanges.
The edtech industry in India, if it has to touch $30 bn in the next 10 years as is the projection, the chance offered by China is to be grabbed with both hands.
