EdTech popularly known as Education technology is an innovation on the typical classes conducted in classrooms. It is a practice of introducing communication and technological tools into classrooms to make classrooms more fun, engaging, and enjoyable for the learners.
The EdTech is changing classrooms in a lot of ways. With the introductions of virtual reality lessons, gamified classroom activities, and edtech robots it is easier now to stay engaged in this type of learning.
The potential for the company to grow in India is wide, individualized learning has played an important role in the edtech industry. It is believed that the edtech company is here to stay for a long period.
In addition, physical education is only based on theoretical knowledge from books and facts. Practical education uses various methods like communication education, psychology, artificial intelligence, computer sciences, and mobile technology to grasp the attention of the learners.
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Startups’ Success and Failure
India is the second largest market for E-learning after U.S. Education Technology. The EdTech started to find its way into popularity in the pandemic 2020. With innovation and the easing of restrictions of the pandemic in 2022 edtech eventually became a part of the student’s everyday learning.
The ed-tech started innovating and eventually became a very powerful business model. Some of the edtech popularly grown in India are BYJU’s, Unacademy, Eriditus, upgrade, Vedantu, Physics Wallah, and many more. However, due to a lot of competition in the market, many tech startups failed miserably. Some of which is discussed below:
Lido Learning was an edtech company founded by Sahil Sheth in April 2019. Its headquartered was in Mumbai, India. Lido Learning was an ed-tech startup that offered live online classes to students from kindergarten to Grade 12.
With a startup of Sahil Sheth already acquired he decided to search for innovative ideas, he went to China where he observed that interactive tutorial classes were very popular. He incorporated the idea and started Lido Learning.
Lido Learning held online classes in a very small format where teacher and student ratio was maintained at 1:6. Following Seth’s previous start-up success it was quite surprising that Lido Learning failed.
Lido Learning had 138 employees by 2019 and managed to earn $3 million in its first series A funding round. 6 months later Lido Learning had over 2000 paying customers and close to 400 teachers. With this growth, Lido Learning announced plans to expand its scope to tier 2 and tier 3 cities.
In series B Lido Learning successfully raised USD 10.5 million in the round. By 2021 Seth, Seth had huge plans for the start-up. He wanted to expand by moving to newer markets and also launch its operations in the UK, Australia, New Zealand, and South East Asia.
In series C he raised $10 million on the expansion plan.
But on 4th February 2022, Lido Learning announced its shutdown operations. The note of this was given to 150 employees, also stating that the company had no more funds to operate.
The main reason for the failure was clear the company ran out of funds. The company was successful in 3 funding rounds but the company was expecting 2 major fundings that unfortunately didn’t happen.
Lido was in losses already
Lido Learning was facing problems monetarily a lot earlier. The company was failing to pay its employees’ provident funds, failing to meet refund requests of its customers, and delaying the payment of its vendors
This technical proves that Lido Learning was facing losses.
Lido Learning had cut off 50% of its employee’s salary during the pandemic yet they were hiring for key roles at the same time. The new requirements were mainly his family members and relatives.
The wrong hiring also led to the finishing up of cash. Also, they were uselessly spending tons of cash on wrong expenses like_ ads which had only negative feedback/comments.
The Lido Learning app had a 15-day trial class where if the user didn’t enjoy the service they would be refunded. It was the policy but when it came to refunding the money there was no such process from the company side.
Udayy was established in 2019 by Karan Varshney, Mahak Garg, and Yadav. Udayy was an edtech company that provided web-based learning to students for grades 1-8. The students who indulged in this were typically 5-11 years of age.
Reasons for the failure
The reason for the failure of this business has been the reopening of the schools. Now that the classes have started offline the reopening of this has led to the closure of the business. As offline classes started the students demanded refunds.
It is not the only EdTech that has been affected by the “drying funds”. Lido Learning had led off 1,200 employees and that too after raising $10 million in funds.
DUX Education will stop its operations in April 2023. The platform has struggled to raise funds. The company is Bengaluru-based. Rohit Jain was the founder and CEO of DUX Education.
The CEO believed that he had created the right system and processes from day one and was running operations at 10% manpower compared to the nearest competitors. He further said that the founders stopped withdrawing salaries six months back to ensure there were no layoffs in the edtech firms.
Jain co-founded DUX Education with Udit Chaturvedi in 2020. The startup aimed to solve the problem of affordability accessibility and engagement and create a world where online learning was way more than a lecture.
The reason the franchise failed was for the fact that the company failed to raise funds and it became more and more difficult to survive in the market. Thus, it is announced that the company will cease to exist from March 31, 2023.
This startup was founded by Ishan Gupta and Aarti Gupta in 2019. The audience for this app platform was from the age of 8-16 years. This platform provided coding as well as fundamentals of computer, app development, and many more. The company discontinued its operations in the middle of 2022
The reason the startup failed to survive is mainly due to a lack of funding. The company was also volatile to unfeasible operations.
The startups are failing miserably in the market. Usually, the Edtech startups have failed due to the main reason as it failed to raise funds. Even the biggest EdTech Companies like Byju’s, Unacademy, and Vedantu all suffer huge losses in their operation and are all likely to cease to exist if the same figure continues.
No matter how great the company is and how great its marketing strategies are the companies will cease to not earn profit in the long run.