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This content was paid for by Credit Suisse and produced in partnership with the Financial Times Commercial department.
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Disruption With Honours: Higher Education’s EdTech Revolution

With places of learning shuttered as governments tried to contain the coronavirus outbreak, students and teachers found themselves taking and teaching classes from home and using digital tools for the first time. The transition may have been smoother for the digital natives that fill our university halls than their younger peers, but the impact on centuries-old higher education models is set to be profound.

“The biggest implication of Covid-19 we’re seeing in education is the mass experimentation with a new breed of education technology and online learning apps. And that won’t go back into the box,” says James Gifford, Head of Impact Advisory of Credit Suisse.

The crisis has resulted in many education technology (EdTech) companies pivoting to help a wider community access quality higher education. 2U, a US EdTech company works with universities to bring them into the digital age and expand access to underrepresented groups. 

“An example of where technology can really drive high quality education for people that need it the most is our technology boot camps. Almost half of our boot camp business students are people of colour and about 30 percent do not have a bachelor's degree,” reveals Chip Paucek, Co-Founder and CEO of 2U. “There's no doubt that technology is part of the story of opening access for people all over the world.” 

2U builds and powers online graduate and undergraduate degrees platforms for partners that include University College London, Oxford, Yale and 75 other institutions. When coronavirus hit the US in early March, the company rolled out Studio in a Box, a toolkit to support professors at partner universities that enabled them to produce courses and film content from home. 

This mass experimentation of using digital tools in higher education means there will be more investment in pedagogy as well as technology. Unlike other tiers of education, higher education is more resource intensive, and its older student cohort expect higher production values in their EdTech applications.

Here’s where the ‘edutainment’ aspect of EdTech comes into play; combining education with entertainment. Afya is a leading Brazilian medical education group that serves and empowers students to be lifelong medical learners. 

Recognising that doctors are often time-poor and exhausted after long shifts, the company created a narrative-led, episodic series complete with storylines and recurring characters. Each episode weaves in topics that will be covered in the doctors’ residency exams.

"The future of higher education is blended and connected."

Emerging technologies such as artificial intelligence (AI) and machine learning are also changing the way higher education is delivered enabling new learning methods such as adaptive learning. AI algorithms gather data points on how students interact with the content and then can adapt and customise the learning literature accordingly. 

A megabyte of data storage 50 years ago would have set you back $1 million dollars. Today, the same amount of storage costs around two cents. This rapid drop has sparked an explosive growth of low-cost personal devices with the number of connected devices expected to reach almost 40 million in the next five years. The advent of 5G will also bring about new possibilities for EdTech, accounting for 20 percent of call connections by 2025.

“There will no longer be a one-size-fits-all, with a lecturer standing in front of a class,” believes Credit Suisse’s Gifford. “Each student can have their own bespoke course, with the same learning outcome.”

Thanks to technology, education is able to open virtual doors to students from disadvantaged backgrounds whom otherwise wouldn’t be able to afford any education, let alone the higher variety. 

“It can reduce the cost of education, it can increase the efficacy of education, and it can make education more inclusive,” says Gifford. “It's not a silver bullet - institutions are still essential and very important, but education technology can enhance the effectiveness and lower the cost of education as we traditionally know it.”

According to UNESCO’s Global Education Monitoring Report, nearly 60 million people could escape poverty if all adults had two more years schooling. Furthermore, the World Bank reports that the economic returns for higher education graduates are the highest in the entire educational system. 

“For an impact investor, EdTech has a multiplier effect. It allows you to invest in those companies that are really making a difference to the lives of disadvantaged students all over the world. It also gives investors exposure to one of the fastest growing investment themes in the economy which is likely to be partially recession-proof.” says Gifford. 

"EdTech can reduce the cost of education, it can increase the efficacy of education, and it can make education more inclusive."

With economic development highly correlated to education outcomes, there is also an emphasis on how people are adapting to jobs of the future. In January 2020, the World Economic Forum declared an imminent worldwide ‘reskilling emergency’, predicting technological advances will mean 42 percent of core skills required to perform existing jobs are expected to change by 2022.

The growth of EdTech doesn’t spell the end of traditional ‘bricks and mortar’ institutions, though it may herald a change in direction. “As soon as it’s safe to do so, students will be back in person, in classes.” adds Gifford. “However, there will also be more online components of courses than there were in the past. While a subset of students will move to fully online models.”

As access to education widens as a result of digital tools, considering the balance of online versus offline will be vital. What can be substituted by online learning and what needs to be complemented with the experience of interacting with peers?

“The future of higher education is blended and connected,” concludes Paucek. “It’s about interweaving the digital offering in a student’s life wherever they are in the world in a way that drives the long-term outcome. In some ways we might be just getting started.” 

There’s no doubt that the crisis has fast tracked EdTech. The combination of compelling content, plus the lowered costs of data and devices, and integration of digital tools has put EdTech firmly at the front of the class.

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