If you are an entrepreneur eager to revolutionise education, figuring out how to make money is a daunting task. In this workshop, in conjunction with Education Entrepreneurs and Startup Weekend EDU, we explore the market opportunity for edtech startups in Asia, as well as different business models in education, the advantages and disadvantages of each, and some inspiring examples of start ups that have found success thus far.

1. BUSINESS MODELS
IN EDUCATION

2. BROUGHT TO YOU BY:

3. AGENDA
● Welcome & Introductions
● Overview of Ed Tech Market in Asia
● Intro to the Business Model Canvas
● The Challenges of Traditional Education
● The Challenges of Online Education
● Business Model Case Studies
● Q&A

4. ● Managing Director, Fresco
Capital
● Invest in early stage
startups in US and Asia
● Early employee at General
Assembly
● Established General
Assembly in Asia
● Previously Goldman Sachs
Allison@allison_baum
INTRODUCTIONS

5. ● 10 edtech
investments
● Seed stage to
Series A
● US & Asia
● Review 2-3
companies per day
● 100: 1 No/Yes Ratio
INTRODUCTIONS

6. OBJECTIVES
● Understand the landscape for education start
ups in the US and Asia
● Use Business Model Canvas to describe
traditional education business model
● Examine strengths and weaknesses of new
business models in education

7. ED TECH IS ON THE RISE
0
500
1,000
1,500
2,000
2,500
2010 2011 2012 2013 2014
Millions
Private Investment in Learning Technology
Companies (US$ Millions)

8. WHY ASIA? MARKET SIZE.
US$59.90bn: Size
of global ed tech
market by 201816
600 million: K-12 students in Asia
5 years: Time until Asia is the
largest regional market 16
300 million:
People
learning
English in
China
195 million: College graduates in China by 2020
40% income spent on education

9. WHY ASIA? CAPITAL.
• US$554.4mn total invested in 2014
• 24% total edtech investment in China (vs. 10%
the year before)

10. WHY ASIA? EXITS.
+200% in 2014 (mostly M&A)

11. BUSINESS MODEL CANVAS

12. DISCLAIMER
There’s No Substitute
for a Great Product

13. THE “TRADITIONAL” UNIVERSITY

14. TRADITIONAL CASE STUDY:

15. Job Preparation
Life Experience
Alumni Network
Access to
Experts
Advisory
Test Prep
Campus
Recruiting
Students
Alumni
Researchers
Parents
Tuition ResearchReal Estate Faculty
Product
Development
Research
Education
Land
Talent
High Schools
Testing
Providers
Government
Endowment
Alumni
Research
Investment
Corporations
TRADITIONAL CASE STUDY:

16. CHALLENGES IN TRADITIONAL EDUCATION
High fixed costs
Inefficient infrastructure
Limited access
Differentiated learning styles
Content development / relevance

17. THE ADVANTAGES OF TECHNOLOGY
Increased access
Increased efficiency
Very low cost
Personalized content
Adaptive delivery
Measurable outcomes

18. THE UNIVERSITY OF THE FUTURE?

19. CHALLENGES IN TECH: ENGAGEMENT

20. CHALLENGES IN TECH: $$$
Sustainability
New business models
Monetizing content
Scaling quickly
Long-term returns

21. A “NON-TRADITIONAL” UNIVERSITY

22. CASE STUDY:

23. BUSINESS MODELS IN ED TECH
B2B: Selling to businesses or government
B2C: Direct to consumer
B2C2B: Freemium
B2B2C: Resellers or Channel Partners
All of the above J

24. B2B: SELLING TO INSTITUTIONS
The Good:
● Large market size
● Large contract sizes
● Long term
commitments
● Sticky customers
The Bad:
● Long, difficult sales
cycle
● Users vs. customers
● Procurement
process
● Customized needs

25. B2B: CASE STUDY

26. B2C: DIRECT TO CONSUMER
The Good
● No bureaucracy
● Easier sale
● User and customer
needs aligned
The Bad
● Smaller overall
market size
● Lower price point =
more customers
● Retention
● Marketing Funnel

27. B2C: CASE STUDY

28. B2C2B: FREEMIUM
Free $ $$
Teachers,
Students
Department,
School
Institution,
District

29. B2C2B: FREEMIUM
The Good:
● Less Bureaucracy
● Users become
advocates
● Flexibility
● Demonstrate
Traction
The Bad:
● Balance between
free & premium
● Can free users be
converted?
● Time spent on non-
paying customers

30. B2C2B: CASE STUDY

31. B2C2B: CASE STUDY

32. B2B2C: RESELLERS
The Good:
● Increased reach
● Large contract sizes
● Upfront payments
● Leverage existing
relationships
● Bypass bureaucracy
The Bad:
● Revenue share
● Lower margins
● Limited feedback
mechanisms
● No control over
customer
relationships /
support

33. CASE STUDY

34. CASE STUDY

35. CASE STUDY

36. ADDITIONAL RESOURCES
More info available:
● Business Models
● Reference Companies
● Canvas
bit.ly/edbusinessmodels

37. Friday May 15 - Sunday, May 17
Follow LearnLab on WeChat: “ghkj2015”

38. KEEP IN TOUCH!
www.frescocapital.com
www.getting-started.co
@allison_baum