Sizing MENA's EdTech Market
The Education Technology industry has been brewing for quite a while globally. The pandemic pushed it to new heights as online learning became the norm. We trace the evolution of MENA's EdTech industry over the years.
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The largely brick-and-mortar-dominated industry of education went through a revolution of sorts as the pandemic brought with it the perfect opportunity to digitize the sector. Online education or learning was a concept not yet popularized until a few years ago. It has been in the talks but never fully adopted or experimented with. For MENA, it was in 2018 that the sector reached the $10M mark for the first time with UAE’s Lamsa raising almost $2M in its Pre-Series A round. Since then funding in the industry has grown steadily at a CAGR of 54% between 2018 and 2021 with investors recognizing the potential of MENA’s EdTech landscape and directing capital into ventures disrupting the space which also included localizing the learning experience such as Lebanon’s Kamkalima, an Arabic educational platform.
The pandemic further fueled the growth of the industry and by 2021, the sector had crossed the $50M mark recording a YoY growth of 103% compared to the year before. Another factor solidifying EdTech growth’s scale is the number of deals. From closing 14 deals in 2017 amounting to $4M to raising $28M across 35 deals, the sector has managed to capture investor interest, especially in the Early-Stage. Investor traction has had a major role to play in the sector’s rise with names like 500 Global, EdVentures, Flat6Labs, and Oasis500 investing in the most number of deals. In fact, EdVentures was specifically launched to invest in EdTech startups in MENA and Africa. With the world gradually returning to pre-pandemic life, we come to the question if the value proposition of online learning no longer holds. In a YoY comparison between 2021 and 2022, we see that funding in the sector has surpassed last year’s numbers in the same period furthering the idea that online learning reflects the future of smarter, more digitized learning spaces.
While the bigger markets of MENA have had their role to play in propelling the EdTech space, it is the smaller markets where EdTech ventures have seen remarkable growth and traction. This year Bahrain accounted for 8% of the deals while 23% of the funding went into Jordan. Not just that, in 2021, it was Jordan that raised the lion’s share of investment accounting for 56% of the total funding. While Jordan’s Abwaab has raised the biggest round to date for the industry, sizable funds have gone into startups like KSA’s Noon Academy, UAE’s Lamsa, and Tunisia’s GoMyCode. Another testament to MENA’s ripe EdTech sector is that recently Classera, a US-based EdTech startup with a focus on MENA, closed a $40M Series A round.
In a geographical comparison, while UAE has seen a decline in EdTech funding, KSA, Egypt, Tunisia, and Kuwait have observed an uptick in the capital this year. The EdTech space continues to evolve as the emerging EdTech Ventures across different geographies are not limited to the just scope of online learning, in fact, the industry has been expanding its portfolio to cater to startups like GoMyCode, which trains talents on digital skills and connects them with tech opportunities, Qureos, a ‘learn to earn’ marketplace, and Coinmarketpedia, a crypto & blockchain e-Learning platform. With 2 months in Q4 still to go, we continue to track the activity in the EdTech sector across MEAPT.
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