While lagging behind healthcare in the pace of technology adoption – therefore historically attracting less private equity capital - the education sector is rapidly emerging as a sweet spot for investor capital. A flurry of compelling investments have taken place in the growing edtech space over recent years, particularly as scalable, global platforms increasingly demonstrate their ability to enhance outcomes, efficiency and access.
Education has proven to be a robust market for investors, with steady revenue flows that tend to be resilient through economic cycles. Investors typically look at four areas: early childhood education, K-12 education, higher education and workforce development. Structural and regulatory hurdles have tended to prevent much private equity activity in higher education, but we see growing volumes of activity across all other areas, where themes of fragmentation, globalization and tech adoption create thematic growth drivers.