Online employee education startups are booming, according to a report from consulting firm McKinsey. Investments in these companies have seen a 45% compound annual growth rate over the past five years, with dozens of startups becoming unicorns. McKinsey identified the trends observed in this booming sector:

• Capital flows to these companies are higher than ever, responding to the need for companies to train their employees in the face of the digital transformation processes they are undergoing.
• Due to the high sales and marketing costs of edtechs (between 20% and 60% of their revenues), mergers and acquisitions are seen as a way to gain market share and efficiency, mergers and acquisitions are seen as the way to gain market share and efficiency.
• The B2B market is the big driver of this growth. Large companies see the training and education of their employees as a necessity.. Firms such as Walmart, Google or Amazon, have announced significant investments with this objective. Thus, of the 15 adult edtechs that received the most capital in 2021, 14 have B2B offerings.
• India is emerging as a major market for edtech, partly due to restrictions in China and English being widely spoken in India.partly because of restrictions in China and because English is widely spoken in India. In 2020 China cornered 63% of global funding for edtech, falling to 13% in 2021, with India absorbing 18%.

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Source: HolonIQ/McKinsey