Thread by @anneleeskates

Over the past decade, $20B has been invested into US edtech, yet only 3 companies have gone public: @coursera, @duolingo, @udemy. Many have written off the space.

🔥take: we are entering the decade of the “Learning Economy,” which spans way beyond traditional education. More🔽

1/ First, #edtech is much broader than we think. It's not just about academic tools and student/teacher tech. The Learning Economy, as we think of it, encompasses all the diff ways we develop as human beings, be it learning to be a better boss, parent, or friend, or a new hobby.

2/ People have hypothesized all sorts of reasons why venture outcomes are difficult: limited TAM, lack of consumer willingness to pay, difficult b2b sales, growth trajectories different from traditional consumer internet companies…

But these dynamics have changed since Covid.

3/ Breaking down the ingredients of a successful startup, we see exciting opportunities for Learning Economy companies along funding, GTM, product, and founding teams 👇

4/ Funding: There’s ~$190 BILLION in government funding for schools to spend on tech in the next 2 years!

TAM and funding for education startups has dramatically increased with gov funding through ESSER.

Note, ESSER = Elementary & Secondary School Emergency Relief Fund.

5/ GTM motions and biz models are now better understood, thanks to @duolingo spearheading freemium subscriptions, @paperlearning and @PrismsVR innovating in K12 sales, @coursera and @reforge in b2b, and @outschool successfully leveraging PTAs as distribution.

6/ Learning products are typically a combination of content, software, teachers/coaches/experts and curriculum. Playbooks developed by @MasterClass @GuildEducation @reforge make this much faster and cheaper.

7/ Zoom allows companies to tap a global supply pool and geographically arbitrage to hire the best and most cost-effective teachers. In fact, many of these businesses have SaaS-like margins.

8/ Several macro trends are at play across all generations of learners:
- Lifelong learning is now the norm
- The gap between what schools/universities teach and what employers want continues to widen.
- Parents have a newfound awareness of what kids learn (and don’t) in school

9/ This all leads to the most important factor in early-stage startups: founding teams.

Founders have taken notice of all of this and are eager to build.

Complementary founders with both Silicon Valley product-building expertise AND education domain experience are pairing up.

10/ The problem space is massive and the experience building consumer experiences from the current generation of iconic consumer companies such as @Uber @lyft @Airbnb are directly translatable to building in the Learning Economy.

11/ We can’t wait to see the next decade of learning and education. If you are building a company focused on any part of learning - early childhood through adult, I’d love to chat!

Read on for the Learning Economy opportunities we’re most excited about: a16z.com/2022/09/16/the…

EDIT: in the first tweet, "last year" should be added to the end of the sentence on the IPO list. There were 13+ education IPOs in the last decade. Also, we did not include any non-US IPOs, acquisitions or majority PE-owned IPOs.