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Brief Market Outlook

2023 started with plenty of bad news for tech in general — the education sector and its Edtech companies are seeing the downside of a world without COVID-19 restrictions. Large and small companies are experiencing layoffs and difficulties in fundraising. Concurrently, the return to physical classrooms and face-to-face instruction has taken the focus away from technology in many parts of the world.

However, it is also fair to say that there is no going back to where the industry was three years ago. Online and hybrid learning have taken a solid foothold in education — from K-12 to Higher Education and lifelong learning.

Indonesia, a nation of 18,000 islands, 274 million people, 50 million students, three million teachers and more than 300,000 schools, is determined to embrace technology to improve its education system. This is the case, in particular, with remote learning and the golden opportunity it provides to overcome previously unresolved accessibility barriers. In addition, online tools have been acknowledged to make education more affordable and more flexible, allowing scores of students to take degrees and skills programs that were previously out of reach. The industry, yearning for better employability among graduates with — especially — better digital skills, is benefitting from substantial changes that address diverse capabilities and labor shortages.

Relevant Key Players

Indonesia has developed a vibrant and innovative Edtech landscape with many online and hybrid learning portals and companies offering coding, digital marketing programs, and other in-demand skills. Additionally, boot camps (online and offline) have gained popularity among young students interested in developing skills typically not offered within their degree programs or educational institutions. Some very interesting brands have emerged in this segment, such as Educourse, Binar Academy, Kuncie, goKampus and Rakamin Academy.

A few innovative Indonesian startups concentrate on specific market segments and services, which sets them apart from the crowd of mostly generalistic online learning options. This is the case of Fammi.ly, a startup offering consultation and psychological support for learners, teachers and families and guiding parents in child development matters. Another exciting company is Eduku, which developed an LMS specifically catering to the data and information needs of local and provincial government agencies in Indonesia, which often lack sufficient and reliable data on public schools for policy-making and targeted outreach programs.

Large tech companies have also been active in Indonesia. Google and AWS are among a handful of local and international tech players who have developed their products or offer services to Edtech companies. Currently, Google seems to be the front-runner in building an ecosystem of Edtech companies in Indonesia, with Google Cloud as the main driver of collaborations and services.

The 7 Trends Shaping Indonesian Edtech

Leaving aside some of the key players, both established and emerging, one can observe some recurrent trends in Indonesia, arguably the most exciting market in Southeast Asia at present.

    1. Digital transformation

    The gradual digitization of society is finding inroads into traditional education. The emergence of new, bold, exciting companies and the consolidation of trusted players contribute to this transformation.

    2. Teacher training

    The public sector is doubling down efforts on professional development. Many private companies are contributing generously to this effort from the perspective of building a more skilled and overly prepared nation.

    3. Public-Private Partnerships

    The Ministry of Education continues to partner with private companies to advance training, instruction and digital transformation of the entire educational spectrum, from elementary school to higher education and lifelong learning. This is the case, for example, of GovTech Edu.

    4. Investment

    During our week in Jakarta, we met numerous startups immersed in (or about to engage with) fundraising. All of them are at the right stage of maturity and make excellent targets for investors in education.

    5. Diversity in business models

    The market is showing a good balance of B2B and B2C initiatives, with an increasing number of companies expanding activity from B2C offerings to B2B or B2B2C models.

    6. Localization

    The most successful companies are those that are hyper-localizing products and services, paying attention to a myriad of factors such as distinct pain points, differentiated user experience, consumer habits, pricing constraints, or access to resources. The acceptability of these solutions seems to meet a preference for working with local companies.

    7. Internationalization

    Ruangguru is not the only obvious name when it comes to expanding beyond national boundaries. Successful startups from Indonesia are already considering the rest of Southeast Asia as an area of influence.

    It is just a matter of time before we see the next Unicorn emerging from the Indonesian Edtech ecosystem. The entire team at EDT&Partners will be watching closely, committed to providing all our support to a diverse number of companies and initiatives.

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    Who are we? Experienced Education Consultants

    EDT&Partners is your Cloud and Business of Education Partner. As a leading business education firm and AWS Public Sector Partner, we work with publishers, edtechs, universities, not-for-profits, networks and public entities to support and to accelerate innovation, strategy and impact.

    Our firm was created in 2016 by business, tech, and education consultants to IMAGINE, INSPIRE and IMPROVE education. We help organizations at all stages with specialized regional consultants in more than 12 countries. Our consulting services provide valuable guidance and support for those navigating the complex and ever-changing landscape of education and technology from K12 to higher education and beyond.

    Our services are divided into two dimensions: growth and tech. For consulting for growth, we offer services of product-market fit analysis, curriculum analysis & gap identification, product optimization analysis & recommendations, and price analysis, market size (TAM, SAM, SOM), channel partners, distributors, and resellers, GTM strategy, and services related to marketing: brand awareness, communication & events. For Tech & Product, we offer services of, interoperability, including a technical audit, a product audit, and a business audit, services of Cloud AWS, including migration, optimization, and leveraging data, we also offer services of AI & ML product enhancement, and, at last, we have our Product-market / Product-business fit.

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