In the past few years, we have seen massive shifts in digital infrastructure employed by schools as well as a rise in digital tools for teachers to support them with administrative and educational tasks. While countries like the US have been investing in digital infrastructure for schools for years, it took a seismic event like the Covid pandemic to expedite a similar investment trend in Europe. Naturally, countries were at varying levels of adoption, but as a rule, tended to be significantly behind the schools in the US.
And then, about a year ago, by which time school closures and the pandemic were no longer top of mind and everything seemed on its way “back to normal”, OpenAI released the first version of their foundational large language model, along with ChatGPT. From day one, education clearly felt like a prime use case – indeed, OpenAI themselves soon released case studies with Duolingo and Khan Academy.
While we (Brighteye) had already invested in organisational and administrative software for schools via Sdui and feedback and assessment software via sAInaptic, the aforementioned AI developments led to an explosion in new tools focused on supporting teachers and school administrators.
This article and the included market map present an effort to systematise the variety of players in the field and to shed some light on recent developments as well as potential opportunities for the future. To do so, we have looked closely at and mapped ~400 different K12 companies. We focused on European actors targeting teachers/schools that are active in the fields of Administration, Lesson Preparation, Communications & Organisation as well as Assessment & Feedback.
The following commentary is structured as below:
(1) Why we believe in this space
(2) Key players + market map
(3) Where we believe there are opportunities
(4) Appendix: Deep Dive: K12 Teacher Support Tools Market Maps (By vertical)
(1) Why we believe in this space
Almost all countries in Europe are facing significant teacher shortages. For instance, there will be a shortfall of 25,000 teachers in Germany by 2025 and 30,000 in Portugal by 2030, according to national estimates, while there are currently 4,000 vacant teaching posts in France[1]. This is mainly due to a lack of new teacher candidates and upcoming mass retirements given that, for example, at the primary school level, 60% of teachers are over 50 in Italy, 37% in Germany, 42% in Portugal, 36% in Sweden and 23% in France. While many policy changes are needed to make the teaching profession more attractive through changes to pay and broader training support, we believe that digital teacher support tools can play their part in increasing the attractiveness of becoming a teacher. These tools can also help teachers be more effective, essentially automating (or partly automating) the more tedious non-teaching related tasks, and streamlining the creation of lesson content and feedback, freeing up time for actual teaching and class interactions.
Research has shown that across the OECD countries, teachers on average spend about half of their weekly time teaching and the other half on non-teaching related activities. This equates to about 17 hours per week spent on organisational and planning activities[2]. Additionally, only 78% of lesson time is spent on learning activities while 13% of time is used for managing behaviour and 8% for administrative tasks[3]. As many public schools lack budget for administrative support to free up teachers’ time for teaching, we believe that teacher support tools can essentially reduce the time spent on non-teaching activities outside of the classroom and increase the time spent on actual learning activities in lessons.
Given the issues presented above, the market for teacher support tools is a multi-billion-dollar market in Europe - and it’s growing. While Europe had been lagging behind when it comes to the digitisation of schools, the wakeup call from the Covid pandemic forced most European countries to equip their schools with basic infrastructure (mainly tablets/notebooks and WIFI) to also enable the use of digital tools. As a next step, many countries started to equip their schools with additional budget (e.g. the “Digitalpakt” in Germany) to purchase a variety of digital applications for administration, teaching and learning. This has included increasing efforts to train new and incumbent teachers in using tech to their advantage. In theory, the incoming and following waves of new teachers will be increasingly literate in how tools can help them both work more efficiently and more effectively. As a matter of fact, it is still not easy to sell into (public) schools, but we are seeing more and more startups successfully tapping into these budgets and subsequently achieving considerable scale in the European K12 space. Many of the companies selling into schools during the pandemic were selling new offers, seen for the first time by teachers during sales pitches – these companies have likely created paths of understanding within schools that did not previously exist.
(2) Key players + market map
Disclaimer: This map presents some example companies for each category out of the several hundred companies we have observed and no scoring of any kind is intended. Additionally, many startups offer different applications and would thus fit into more than one category. For simplicity’s sake, the map below presents them in their main category. Focusing on non-teaching activities, teachers spend most of their time on lesson prep and assessment & feedback (about 5 hours per week each). Less time is spent on purely administrative work (3 hours) and communication & organisation (2 hours). Also considering market size for each category, this shows that many startups (at least first) started in categories that take less time for teachers and/or where overall market size is smaller. The recent AI developments brought about the biggest push in lesson prep, which takes up considerable teacher time and is the second largest market overall.
When looking at the space, we have decided to group the startups within four categories:
(1) Administration
Administration tools tend to include student information systems, class and course management, admissions and CRMs.
(2) Communications & Organisation
Communications and organisation tools tend to include, among others, chat applications, timetabling and tracking systems, scheduling tools, payments and resource booking.
(3) Assessment & Feedback
Examples for assessment and feedback functionalities include grading and grade reports, quizzes, performance analytics and certifications.
(4) Lesson Preparation
Lesson preparation is sometimes included in assessment and feedback, however, as this is one of the most active spaces in the current startup scene, we decided to map digital tools for lesson planning and delivery separately.
With this in mind, we’ve pulled together our key observations:
Observation 1:
Assessment and feedback has historically been the most crowded and active space, featuring early and well-known winners like Kahoot!, but it is also the smallest when it comes to market size. The main reasons for the increased activity in this sub-vertical are that the barriers to entry for (multiple choice) quizzing tools have in the past been rather low and given the time teachers spend on assessment and feedback, the demand for digital tools to support with these tasks has always been high- the case for adoption has always been quite clear! With GenAI entering the frame, we see a surge in tools focusing on assessment and feedback for open-ended questions and essays. While most of these tools are still in their early days and work better in some subjects than others, particularly where correct answers tend to be more factual and prescriptive, we are finally seeing valuable, viable applications outside of Maths and the sciences. Not only are we seeing this broadening of subjects covered, but we are moving towards more pedagogically relevant feedback and assessment tools that do more than simply provide automatic feedback to multiple choice answers.
Observation 2:
New tools utilising AI to support with lesson planning and delivery seem to be appearing on our radar daily and existing content-focused platforms are building these tools on top of their formerly mostly static content. Thus, the lesson preparation space is arguably the most heated at present. As these new tools essentially allow teachers to drastically accelerate their yearly, weekly, and individual lesson planning in accordance with their local curricula and to access highly individualised content at the same time (what does this second bit mean? For individual students or enabling teachers to teach how they want?), it will be interesting to see how startups continue to challenge the textbook publishing industry and its incumbents.
Observation 3:
Administration as well as Communications and Organisation is a very fragmented market with players that have been around for decades, a few upcoming startups that are expanding across Europe and building all-in-one solutions but a majority of very local startups with verticalised solutions. These small, local startups are for example building solutions that are focused solely on communication between teachers and parents or digitising school related payments. This is the space where we have already seen increased acquisition activity in the past and expect this trend to continue with verticalised startups presenting attractive acquisition targets for larger companies to expand product capabilities and enter other European markets.
Observation 4:
We see a clear trend towards B2C or B2B business models depending on the category of the companies. While most solutions in the administration as well as communication & organisation buckets follow B2B models, teacher tools relating to the way that teachers design and deliver content are mainly B2C. This includes most of the companies in ‘Lesson Prep’ and ‘Assessment and Feedback’. This is partially driven by the typical go-to-market of these companies being: a) market to teachers, b) get teachers to trial the solution, c) spread word within their school and then when the company realises that several teachers in a school are using the solution, d) the company goes to senior leadership to pitch its value proposition for us across the school (and ideally, group of schools!). However, with improving understanding of the benefits of these platforms across their teaching workforce, we expect to see more and more school leaders looking to centralise tech solutions, realising that such tools are becoming a core part of teachers’ lesson planning, delivery and marking practices. With larger contracts available and less onus on popularity with individual teachers, we expect to see significant consolidation in 'Lesson prep’ and 'Assessment and Feedback’ areas in the years to come.
Observation 5:
Schools vary but core operations are broadly similar across the continent (similar hours, similar class ratios, similar curricula, similar pedagogy, similar back-office functions), laying the ground for a competitive battle over chosen operating systems across Europe. Hence, several of the solutions within ‘Comms and Organisation’ claim to offer broadly similar solutions but with varying elegance. The winner will likely be the company that can best consolidate solutions to the most potent pain-points experienced by teachers and school leaders.
(3) Where we believe there are opportunities
Opportunity 1:
Most current lesson planning tools are focused on B2C and rely heavily on teachers’ ability to engineer the right prompts. We believe a huge opportunity is building lesson planning and delivery tools that are highly embedded with the rest of the school’s tech stack and enable teachers to fast track their yearly, monthly, weekly, and individual lesson planning, preparation and delivery based on the local curriculum and up-to-date content. Essentially a teaching assistant for teachers that will allow them to free up hours that would usually be spent on these topics. There are a bunch of startups in their early days building just this and beginning to show the first signs of product-market fit, e.g., Teachino.
Opportunity 2:
Extending lesson planning to enabling teachers to deliver homework tailored to the way individual students learn. It is well-known and accepted that learners learn in different ways, not only in the case of specific learning differences, like dyslexia and autism, but in whether they prefer to learn through audio, quizzes or kinaesthetic activities. If teachers are enabled to deliver homework to students in a way that truly matches how students best learn, achieving the same learning objectives regardless of the way the task is delivered, students will (hopefully) make significantly more progress. Only so much personalisation can take place in the classroom given typical teacher:class ratios - but this of course isn’t the case outside of lessons. Teachers clearly don’t have the capacity to create the same homework in 5-10 different ways, but tech tools can.
Opportunity 3:
Developing the assessment engine 2.0. We see huge potential for the company that cracks grading of and providing useful feedback on open-ended and essay-style questions. In that case, the main customer does not have to be teachers or schools but instead the assessment engine 2.0 can be made accessible through an API and used by large education providers and publishers to make their content more engaging, relevant and increase learning outcomes based on more personalised feedback. By doing so, the company would increase reach from day one based on the millions of teachers and students already working with many of the large education providers that are not necessarily at the forefront of technological innovation. We have seen a few companies starting to develop such B2B engines and showing the first signs of success, e.g., Taskbase and sAInaptic.
Opportunity 4:
Building the Powerschool for Europe. Like other Edtech verticals there is somewhat of a battle between deeply integrated vertical solutions and companies offering all-in-one solutions. However, we expect that a big European winner can be built by offering an all-in-one digital administration, communication, and organisation (long-term potentially also assessment & feedback and lesson preparation) suite for schools and doing so by acquiring and integrating other vertical solutions from different geographical markets across Europe.
We want to congratulate and encourage all the European entrepreneurs who are building companies in the teacher support tools/K12 space. We know it’s a tough market to crack and we would love to receive your feedback on this piece and connect if you are building something exciting. Let’s chat: ha@brighteyevc.com
4. Appendix
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