Mideast private investment in ed-tech ‘alarmingly sparse’

Mideast private investment in ed-tech ‘alarmingly sparse’

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JEDDAH – In the Middle East, private investment flowing into education technology (ed-tech) across all age groups is alarmingly sparse. In fact, since 2011, approximately 3,200 education companies around the world have received private ed-tech investments – and only 12 were based in the Middle East, according to a new report by the World Economic Forum (WEF) in collaboration with The Boston Consulting Group (BCG) titled “New Vision for Education: Fostering Social and Emotional Learning through Technology”.

The study – which includes the results of a survey of more than 2,000 parents and educators around the world – found that, across the globe, private investment in ed-tech has expanded, broadening opportunities to reach vast new communities of learners. The report showed that, since 2011, private investment in ed-tech for all age groups globally has increased at a 32% average annual pace, from $1.5 billion in 2011 to $4.5 billion in 2015, with investment in preschool through secondary school accounting for the bulk of total investment (38%) over that time span.

Given the global education context, these figures come as no surprise. Today, social and emotional learning (SEL) skills such as collaboration, communication and problem-solving are critical to the labor market and the workforce of the future; more importantly, based on a 2011 meta-analysis of 213 studies – involving more than 270,000 students from kindergarten through high school – these key competencies have the power to boost academic performance by as much as 11 percentile points.

The survey reveals that both parents and educators have a narrow understanding of SEL, viewing the educational process as a means of achieving better classroom discipline rather than a way to ensure optimal academic and economic outcomes over the long term.

In addition, the analysis posits that ed-tech has the potential to play a pivotal role in fostering SEL efficiently and cost-effectively. “Technology can serve as a tool for parents, educators or caregivers to use to complement and extend children’s learning experience – especially given the host of emerging technologies that go beyond traditional screens,” said Leila Hoteit, Partner and Managing Director at BCG Middle East. “These innovations are capable of mixing the physical and virtual worlds and facilitating forms of human interaction impossible a decade ago.”

Ed-tech – from mobile apps for preschoolers to online courses for adults – has drawn increased interest from investors in recent years, although the total investment in the space represents only a small fraction of overall venture capital investments.

“In the Middle East, however, the investment landscape for ed-tech shows signs of stagnation,” added Hoteit. “In parallel, since 2010, across the region, the majority of private investment deals directed to ed-tech have gone to areas such as higher education programs and services, followed by language and literacy, multimedia content platforms, and academic standards-based programs.”

Across the region, there are 12 companies that have received ed-tech investments in recent years: three in Egypt, three in Saudi Arabia, one in Jordan, one in Kuwait, one in Lebanon, one in Oman, one in Qatar, and one in the United Arab Emirates.

Their focus areas mainly include higher education followed by several other themes such as blended learning as well as language and literacy programs.

Moreover, globally, the explosive growth in ed-tech is concentrated in the US, where 77% of total investment dollars has been directed since 2011, with China and India the next biggest, with 9% and 5% since 2011, respectively. More specifically, when looking at the total amount of investments, the study revealed that three out of four dollars flow into ed-tech companies in the US and almost 97% of the total investment is concentrated in five countries, none of which are in the Middle East.

In the Middle East, since 2011 the total amount invested has reached approximately $1 million, with most of the investment flowing into companies in Egypt.

To date, worldwide, most of the learning strategies commonly used to develop social and emotional skills don’t rely on technology or do but only in a limited way.

“The survey shows that most parents and educators recognize the power of ed-tech and its ability to help build social and emotional skills,” said Hoteit. “Still, they don’t fully understand which technologies hold the most promise or how to use them best. And, they prefer to use technology for the purpose of imparting foundational academic skills.”

For example, in the US, only 67% of teachers believe technology is best used for foundational subjects, such as literacy and numeracy, compared to only 43% who believe that it is best for social and emotional skills. These results strongly reflect the findings of other countries.

Interviews with education and technology experts and in-depth research into many promising examples of ed-tech – highlighted in the report – underscore the fact that technology is essential to fostering SEL.

In line with this, the study identifies three critical opportunities for policymakers, parents, educators, and others to equip children with the social and emotional skills that they need:

1. Help educators, parents and others understand what really boosts social and emotional learning. The analysis lists 55 research-based product features highly correlated with 10 critical social and emotional skills.

2. Embed SEL into products that support foundational skills such as literacy and numeracy. After all, 95% of venture-capital investment directed to ed-tech has flowed into those specific areas since 2011.

3. Take advantage of five nascent technology trends – wearable devices, leading-edge apps, virtual reality, advanced analytics and machine learning, and affective computing – that extend ways of fostering SEL and also offer potential for exciting new learning strategies.

To thrive in the 21st century, students must have core competencies that are clearly linked to a range of benefits including higher levels of academic success and employment. Many stakeholders, however, lack awareness of all the positive and long-lasting impacts of SEL.

Ed-tech offers an opportunity to address some of these barriers by embedding SEL features into foundational academic products. The list of features linked to social and emotional skills – and compiled in New Vision for Education: Fostering Social and Emotional Learning through Technology – can serve as a guide to achieving this.

“Tremendous innovation is happening in education as well as across industries that we can learn from to design new learning experience for the future,” said Mengyu Annie Luo, head of Media, Entertainment, and Information Industries at the World Economic Forum. “We are very excited to continue the work with leading technologists, thinkers, educators, researchers, business partners, and policy makers to identify new ways to advance SEL for all the critical skills students need.” — SG

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