Although the education arena has been relatively slower than many industries to adopt advanced technology, new concepts are making inroads, leading tech entrepreneurs and venture capitalists to turn more of their attention to the classroom. Although several elements of this market make continued growth a challenge, some creative entrants appear determined to succeed.
Consider Remind, for example. This messaging app is free and allows teachers to communicate readily with both students and parents. Instructors can send reminders of homework due dates or test times; coaches can update participants on scheduling changes or weather-related delays. In addition, the school staff can keep parents immediately in tune with what their children are doing in the classroom. Approximately 23 million users are now sending messages, mostly after learning about the functional app through word of mouth.
Pluralsight instead targets adults who have already graduated from school but need to stay up to date in their education. For a $29 monthly subscription, technology learners get lessons on the latest gaming innovations or changes in programming languages. Some estimates suggest that, with the rapid pace of technology changes, programmers’ knowledge base falls out of date within about two years on average. To stay current, they need to keep learning, and Pluralsight provides them with the tools to do so. Pluralsight also sells package plans to companies, allowing them to pay a larger fee and offer lessons to all their employees.
With this approach, Pluralsight earned nearly $100 million last year. In contrast, Remind has yet to find a way to monetize its offerings, because it remains a free app. Several other education-related technologies similarly struggle to find a way to convince people to pay for their services and thus have started off with a “freemium” pricing strategy. That is, they offer their products for free to start, then hope that consumers find those offerings appealing enough that they will pay to upgrade to a better version. For Remind, the goal is eventually to convince schools systems that teachers, students, and parents already are using its service, so the district should pay for the capability to notify everyone of weather-related cancellations or other key updates.
Even with these challenges though, investments in education-related technology continue to grow. Recently, Pluralsight took in $135 million in financing. Remind (which has yet to earn any revenues) attracted a combined $40 million from several venture capitalist firms.
Whom should education technology firms target to receive payments for their services and products: students, parents, teachers, or schools?
SOURCE: Natasha Singer, “Silicon Valley Turns Its Eye to Education,” The New York Times, January 11, 2015, http://www.nytimes.com