2022 European edtech report: Smaller rounds and fewer deals, but more angel activity
The European edtech market is forecast to be worth €32.4 billion by 2022, a significant increase from last year’s €24.6 billion, according to the latest report frommagazine.
Despite the overall European edtech market growth, the number of deals and the average deal sizes have both decreased in the past year. In the first half of 2017, there were 214 edtech deals worth a total of €1.4 billion. This dropped to 192 deals worth €1.2 billion in the first half of 2018.
The decrease in deal activity is due to a number of factors, including a challenging fundraising environment for early-stage startups and an increase in the number of “cautious” investors.
However, there has been an increase in angel activity in the edtech sector, with the number of angel-backed deals increasing from 19 in the first half of 2017 to 30 in the first half of 2018.
The average edtech deal size has also decreased, from €6.5 million in the first half of 2017 to €5.9 million in the first half of 2018.
The decrease in deal sizes is in line with the overall decrease in deal sizes across the European tech sector.
Looking at the edtech sector by country, the UK continues to lead the way in terms of deal activity, with 60 edtech deals worth a total of €377 million in the first half of 2018.
This is followed by Germany (42 deals, €241 million), France (27 deals, €155 million), and Spain (20 deals, €83 million).
In terms of deal value, the UK is also in the lead, with the average deal size being €6.3 million. This is followed by Germany (€5.8 million), France (€5.7 million), and Spain (€4.2 million). The most active investors in the European edtech sector in the first half of 2018 were NewSchools Venture Fund, Balderton Capital, and Index Ventures.
The most well-funded edtech companies in the first half of 2018 were Pluralsight, a US-based online learning platform raised $135 million; Télécom Ecole de Management, a French online business school raised €40 million; and Test Your English, a UK-based online English language testing platform raised $37 million. The most active acquirers in the edtech space in the first half of 2018 were Microsoft, LinkedIn, and SAP. 2022 European edtech report:
According to a new report, European edtech companies raised €3.3 billion in 222 deals in 2020, down from €4.1 billion in 301 deals in 2019. The average deal size also decreased, from €13.7 million in 2019 to €14.9 million in 2020.
Despite the pandemic, 2020 was a relatively strong year for European edtech investment, with deal activity only slightly below the five-year average. However, the average deal size was the lowest it’s been since 2016.
The report found that seed and angel investment increased in 2020, while venture capital investment decreased. This is in line with what we’re seeing in the US, where edtech startups are increasingly turning to smaller rounds and alternative sources of capital.
One bright spot in the European edtech landscape is the UK, which continues to lead the way in terms of deal activity and fundraising. In 2020, UK edtech companies raised €1.1 billion in 123 deals, more than any other European country.