How to scale to new markets using pilots with international school operators.

GUEST COLUMN | by Michael Spencer

MAKSYM MAMCHUROV

It’s hard to ignore the ongoing macro market challenges in edtech right now: venture investing is at just 10% of peak 2021 levels, while K-12 budgets in the U.S. are facing a $65B revenue decline due to the ESSR funding cliff, declining enrollment and increasing labor costs.

At the same time, sales to schools has become ‘noisier’ as there are more and more K-12 startups selling products, while US school districts have cracked down after being inundated with sales offers and phishing scams that lead to ransomware attacks.

Global from the Get-Go

In this climate, the only viable route to success for edtech companies is adopting a global sales strategy from the get-go. 

‘In this climate, the only viable route to success for edtech companies is adopting a global sales strategy from the get-go.’

Over the years, I’ve spoken with many edtech founders about go-to-market and many of them have expressed a reluctance to expand and sell into international markets. They cite long sales cycles, high costs and low success rates among the reasons they don’t want to do it. After all, selling to U.S. schools and districts is challenging in the best of circumstances, so why extend that effort to geographical markets you know even less about? 

To Take Your Startup to the Next Level

However, the reality for many K-12 B2B founders, especially if they sell to U.S. school districts and/or organic growth has reached a saturation point, is that to take your startup to the next level, you need proactive early growth into international markets. As a long-time edtech executive turned early- to mid-stage investor, I believe that using channel partners to facilitate growth into thousands of untapped international school operators can be a highly successful way to scale your sales. Expanding into international markets while you’re trying to establish your company may sound daunting, but it’s often the simplest and fastest way to generate scalable, sustainable recurring revenue growth.

The Key is Pilots

So how do you put this into practice? The key is pilots. 

What are pilots?

Pilot programs aren’t the same as product demonstrations, or even beta tests. Conducted effectively, pilot programs can help schools and companies together weigh the potential value and impact of new education tools in ways that tests alone typically can’t.

This makes pilots a critical part of the K-12 sales process. They are also a common fail-point for vendors, something I call ‘pilot purgatory’ – prolonged pilots with no clearly defined expectations, measure of success or decision points that don’t then convert to paid customers. The majority of schools lack the resources, know-how, tools and processes to conduct effective edtech pilots, so to make this the cornerstone of a successful global growth strategy, you need to be prepared to take the lead.

What does a successful edtech pilot program look like? What pitfalls should you avoid?

Advantages of pilots

‘Fail fast’ is a famous philosophy among startup entrepreneurs. For product developers, this means rapid testing and re-development to find what solves your users’ pain points most effectively. When testing and evaluating edtech solutions, it is most valuable to do it in the classroom with real teachers and students. This enables:

• Feedback loops → the developer gets the most relevant feedback to support feature development by improving their understanding of how schools actually use technology and what the real needs of teachers, students and parents/carers are, as well as identifying potential challenges ahead of technology implementation. (For this reason, the famous accelerator Y-Combinator lists pilots as criteria in their guidelines for edtech products.)
• Educator buy-in → pilot programs increase communication between schools and companies, as teachers can see the tool in action and founders develop a deep understanding of the way schools really work, their challenges and roles. Enhanced communication and collaboration among stakeholders creates a more connected learning community.
• Evidence of efficacy → pilots are best practice to find product-market fit and pave the way to get VC funding. The biggest edtech-focused VCs, such as Reach Capital, guide companies to build their own efficacy portfolio.

Overcoming challenges for a successful pilot

1. Identify need – Clearly articulate the specific challenge your solution is trying to address so you can clearly communicate the value you will add to a school’s day-to-day operations. Exploring international markets doesn’t require a shift in mission, values, or approach. Students globally all face the same challenges – all that’s required to succeed in the international market is a strategic channel partner or school operator who knows what works and what they need to maximize your impact, to do your due diligence, and to ensure solutions are presented in a manner that the local market needs.

2. Plan – Agree with the school upon specific pilot objectives to ensure a shared vision and identify data that will be used to determine success. Set agreements with the school that outline roles and responsibilities, timelines and how results will be used.

3. Train and implement – Ensure teachers have training and tech support to enable strong implementation of your solution. Take a high-touch approach to onboarding students.

4. Collect data – Collect quantitative and qualitative data so you can determine whether the pilot objectives are being met. Create formal opportunities (such as surveys, focus groups and post-pilot debriefs) for teachers and students to give feedback. Send usage updates to the school regularly throughout the pilot.

5. Analyze and decide – Analyze collected data to evaluate whether the edtech tool met the pilot objectives.You can pilot something, but without a benchmark and post-pilot review, it is useless. Work with the school to understand and negotiate the total cost of implementing the edtech tool. (Consider ongoing costs for licensing, installation, training and tech support.)

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Michael E. Spencer is founder and CEO of Global Expansion Strategies supporting founders and schools with all aspects of the pilot process. To date, 100% of GES pilots have gone on to full implementation, with significant impacts on student outcomes. Connect with Michael on LinkedIn. 

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MARKET.US

The K-12 edtech spend market size is expected to be worth around USD 132.4 Bn by 2032 from USD 18.5 Bn in 2023, growing at a compound annual growth rate (CAGR) of 25.2% during the forecast period from 2023 to 2032, according to research firm Market.us.

K-12 education technology spend refers to the expenditure on technology products, services, and solutions specifically designed for the K-12 education sector. This includes hardware devices, software applications, learning management systems, online educational resources, and other digital tools that enhance teaching and learning experiences in schools.

The K-12 education technology spend market has witnessed substantial growth in recent years. According to market research, the market size is projected to reach billions of dollars by the end of the forecast period. The driving factors behind this growth include the increasing adoption of digital learning, the need for personalized and interactive educational experiences, and the growing emphasis on STEM (Science, Technology, Engineering, and Mathematics) education. Learn more.

The post Bigger Picture: Continued Edtech Growth in Coming Decade appeared first on EdTech Digest.