ed tech in asia: key trends and opportunities
TRANSCRIPT
ED TECH IN ASIA: KEY TRENDS
Allison Baum, 18 June 2015
INTRODUCTION
WHY BE HERE?
“We’re here to put a dent in the universe. Otherwise, why be here?”
- Steve Jobs
Early stage venture investors supporting exceptional entrepreneurs to build remarkable businesses
WHO WE ARE Allison Baum, Managing Director, Tokyo, Japan
Ø Experience in educa3on opera3ons management including: curriculum development, marke3ng, teacher training, real estate expansion, hiring, and business development
Ø Bootstrapped and launched educa3on business in Asia, scaled to US$1mm revenue run rate, 2,000+ students, 60 teachers, 6 employees in nine months
Ø Ins3tu3onal sales and trading at Goldman Sachs, 8 years investment experience in public and private markets
Tytus Michalski, Managing Director, Hong Kong SAR, China
Ø 16 years in cross-‐border investment experience across Hong Kong, Singapore, Tokyo, London, Canada, and the United States
Ø Previously Chief investment Officer of PMA Investment Advisors, where he managed both regional funds and the equity team
Ø Founding member of PMA, scaled from US$600mln to US$3bln in ins3tu3onal AUM and sold in 2006 for US$200mln
Stephen Forte, Managing Director, Menlo Park, CA, USA Ø Tech Strategy at Telerik, US$260mln exit Ø Experienced entrepreneur with 5 successful exits Ø Mentor at Thiel Founda3on, ChinaAccelerator, HAXLR8R Ø Founder of Mach5, a Silicon Valley based startup accelerator and co-‐founder of AcceleratorHK,
Hong Kong’s first startup accelerator
WHY EARLY STAGE?
RETURNS ü Target returns 30% IRR / 5x TVPI multiple
ü Current portfolio on track to exceed targets
ACCESS
ü Diverse network of deals & people
ü Over 300 co-investors around the world
INNOVATION ü Cutting edge technology, teams, businesses
THE NEXT FRONTIER
2015 1800
THE RISE OF ED TECH
0
500
1,000
1,500
2,000
2,500
2010 2011 2012 2013 2014
Millions
Private Investment in Learning Technology Companies (US$ Millions)
THE RISE OF ED TECH
HIGH PROFILE EXITS
0
10
20
30
40
50
60
70
80
90
100
2011 2012 2013 2014 (est)
# De
als
Ed Tech Exits +200% in 2014
IPO
M&A
ü 75% capital invested into edtech in 2014 was U.S.
ü 9/10 largest financings in U.S.
ü 60 million K-12 students
ü 96% of K-12 students in the world are outside of the U.S.
USA HAS LED THE WAY
ASIA IS NEXT
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
DEVELOPING ECOSYSTEMS
ü People
ü Connectivity
ü Capital
GRASS IS GREENER
LOCAL CHALLENGES ü Localization
ü Business Model
ü Language
ü Culture
ü Values
ü Timing
ü B2C business models
ü Mobile
ü Language Learning
ü Exits
KEY OPPORTUNITIES IN ASIA
#1: B2C IN ASIA
ü 600 million K-12 students
ü 40% income spent on education
ü 60-96% of secondary school students receive outside tutoring
#2: MOBILE IN ASIA
ü APAC = 57.7% of the world’s mobile phones
ü 80% of internet users in China access via the mobile/tablet
ü Highest % mobile payment users in the world
#3: LANGUAGE LEARNING ü 300 million people
learning English in China
ü 30% of foreign students studying in U.S. are from China
ü English skills correlate with 30-50% higher income
ü Education Travel = US$80 billion / year
ü Language Education= US$12 billion /year
ü 80% students sent by agents
ü Mobile
ü Publishing/Media
ü Tech/ Gaming
ü Education
ü IPO
#4: EXITS
CROSS BORDER ACTIVITY
ü Global solutions
ü Local implementations
ü Cross-border collaboration
ü Global, specialized investors
WHAT’S MISSING?
GLOBAL CHALLENGES
ACCESS EFFICIENCY
ENGAGEMENT OUTCOMES
ü Limited
ü Quality vs. scalability
ü High fixed costs
ü No infrastructure
ü Differentiated learning
ü Motivation
ü Assessment
ü Relevancy
GLOBAL SOLUTIONS
ACCESS EFFICIENCY
ENGAGEMENT OUTCOMES
WHERE FRESCO FITS IN
ü Bridging the gap
ü Investing in scalable solutions
ü Dedication to sector
ü Early stage Capital
ü People first
HOW WE DO IT
“If you want to build a ship, don’t drum up the men to gather wood, divide the work, and give orders. Instead, teach them to yearn for the vast and endless sea.” ― Antoine de Saint-Exupéry
GET INVOLVED “The people that are crazy enough to think they can change the world are the ones that do.”
- Steve Jobs
