Owl Ventures is the world's largest edtech-focused venture capital firm, holding investments all over the world. What role do you see India's edtech sector playing in Owl Venture's long-term investment strategy?
At approximately USD6 trillion, the education market is the second-largest market in the world, and it has been experiencing a significant surge in digital penetration. Some of the world's leading edtech companies are being started in the Indian ecosystem. The meteoric growth of both WhiteHat Jr and Byju are illustrative of that rapidly growing and maturing edtech market in India and throughout the world. Additionally, rapid changes in the global economy have led enterprises and adult learners to seek digital tools for upskilling and reskilling. This has created a multitude of opportunities for innovative companies in the career mobility and professional learning sectors. Owl Ventures is excited to continue to invest in the region. Our strategy is to make early-growth and later-stage investments in the world's leading edtech companies across the education spectrum, namely everything from pre-K through 12 to higher education and the future of work, which includes career mobility and professional learning. We seek to partner with visionary entrepreneurs that are tackling large problems in education as well as training and helping build transformative category-leading companies.
What are the key factors for Owl Ventures when considering different markets to enter at this stage?
We take a comprehensive perspective when making these investment decisions. India is definitely an innovation hub when it comes to creating top-tier edtech companies. With one of the largest student populations in the world, increasing access to the internet and connected devices, and the tremendous importance being placed on education, India has all the key factors necessary to create a vibrant edtech ecosystem. And that can serve learners not only in India, but globally as well. Additionally, on the regulatory side with the National Education Policy 2020 coming into effect, certain policies—such as universities in India being able to offer fully online degrees—are also extremely conducive to creating edtech companies. Finally, the rapid changes taking place in the global economy as well as in India will require enterprises and adults to seek digital tools for upskilling and reskilling, and this will create a multitude of opportunities for innovative firms within edtech in India. Owl Ventures is excited about these investment opportunities across all areas within the India edtech ecosystem. There is an exciting path forward in this sector in India.
What are you looking out for in terms of how India's government is implementing its new National Education Policy?
There are a few things. One is that this is an introduction into online education for India; for example, only a limited set of colleges and universities have been given the green light to offer online degrees. We will need to see how that initial batch fares and what expansion to make this available to the entire education ecosystem will look like. The second point is that quality really matters. Where we have seen this go awry in other parts of the world is when people start to prioritize other factors over the quality of the education being delivered and the outcomes. We take learner outcomes extremely seriously at Owl Ventures in the investments we make. The companies in this space that will be the most valuable are the ones actually delivering some type of value to the learners on their platform. That same philosophy is important to success when setting up a national education policy and ecosystem in a country.
What will be the biggest and long-lasting impact of COVID-19 on the edtech industry?
The education sector is certainly experiencing a significant surge in digital penetration. Although this was occurring pre-COVID-19, the pandemic has accelerated this trend, and we expect it to continue into the future. The current situation has shone a spotlight on the education sector. K-12 schools moving to blended learning environments, colleges and universities shifting to online learning, and a significant percentage of the adult population working from home or searching for upskilling or reskilling opportunities are all factors that have placed edtech in this spotlight right now. There has been significant demand for edtech across all those sectors. Our outlook for the sector today is even more bullish than when we started Owl Ventures. The caliber of entrepreneurs and talent entering the sector, the speed with which these companies are reaching significant scale or expanding internationally, and the strong capital flows coming into the sector are all happening faster than we could have predicted when we first started out. The sector has a pretty incredible trend line for the coming decades.
What is your outlook in general for the remainder of 2020 and into 2021, and what are your specific priorities at Owl Ventures for 2021?
We will continue to make early-growth and later-stage investments. Our focus is to invest in the world's leading edtech companies across the spectrum. We are typically the lead investor in the vast majority of the deals we do, and we join the boards of our companies. Owl Ventures takes an extremely hands-on approach to working with companies. We work with them across multiple functions, including distribution, partnerships, talent, fundraising, and outcomes measurement. Owl Ventures has created a fairly robust community of entrepreneurs within our portfolio who we invite to CEO summits and industry specific events, allowing them to share best practices and insights, as well as explore partnership opportunities. As an edtech specialist, our fund has also been able to successfully partner with leading diversified venture capital and private equity funds, including several funds in India. That has really helped accelerate the growth of Owl Ventures' portfolio companies. The coming decades will be exhilarating for the edtech sector, as some of the largest companies in the world will be created in this sector. We are incredibly excited to be at the nexus of all that activity.