EdTech Funding Lower Middle Market
EdTech Funding by Year – Lower Middle Market (In millions of USD)
733
Total Deal Size in ($M) # of Deals
In 2024, EdTech companies raised approximately $800 million in funding across 167 deals. The challenging market conditions of high interest rates and the cost of capital influenced investor sentiment, leading to a cautious approach. Renewed optimism due to changing market conditions is likely to result in a rebound on par with recent M&A activity in the industry. Key trends: • Investor Focus on Profitability: Investors are exercising increased scrutiny, favoring companies that demonstrate stronger profitability profiles. • AI-Driven Innovation: AI remains a key driver of innovation in EdTech, with investors eager to explore and support AI-powered solutions that demonstrate real-world educational impact and address evolving assessment needs. • Evolving Skills Training: EdTech companies embracing innovative approaches such as bite-sized learning, modular course design, and simulation-based training to cater to the evolving needs of learners attracted investor interest. Although the current funding environment is more challenging than recent years, EdTech continues to offer significant investment potential. The demand for better learning experiences, coupled with the emergence of innovative tools and platforms, will drive continued growth in the sector. Moreover, the significant room for improvement within the education system itself will continue to incentivize entrepreneurs and drive innovation in the sector.
570
482
280
167
$1,613
$2,919
$1,775
$968
$792
2020
2021
2022
2023
2024
EdTech Funding Volume by Quarter – Lower Middle Market
(In millions of USD)
Total Deal Size in ($M) # of Deals
192 186
164
161 172
149
138
137
120 120
119
97 88
73 67
47 49 43
44
30
Source: Pitchbook as of 31 December 2024. Data consists of transactions where deal value was disclosed. Note: Companies valued below $150 million were considered as lower middle market. Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2020 2021 2022 2023 2024
23
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