A society of test-takers
It was a big week for India, with a pretty sick victory of Australia at the Gabba in Brisbane. What a win, and it was fantastic to see so many promising Indian cricketers getting their moment to shine. I haven’t watched cricket in a loooong time, but tuned into this series. It was fortuitous and a reminder of how inspiring sport can be at its best. It was also a pretty momentous week in America, with the inauguration of the Biden-Harris administration. More than anything, I’m enjoying the Trump-less landscape.
On to today’s update. My tweet on Indian edtech went a bit viral last week, so I decided to expand on it. And we have a round-up of last week’s news, reads, podcasts and book recommendations.
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The state of Indian edtech
Indian edtech has undoubtedly been the break-out startup India story of the pandemic. It's a story we have chronicled week after week in our Whatsapp and Substack newsletters. Even as valuations rise, and new players like Amazon enter the edtech space, what exactly are these companies offering as services? The value prop isn't the democratization of education per se. It is the democratization of access to material that helps you prep for the entrance exams that define Indian students' life. A week ago I tweeted out this somewhat half-baked thought:
I was surprised at how quickly the tweet went viral. If I have to be honest, I think most people in India are frustrated with the current system of test-taking and this resonated. As many people noted, we are already a society of test-takers. I agree with that. To some extent, this is why edtech is India is disappointing. We expect technology to disrupt existing, subpar systems. Indian edtech seems to be embedding them further.
BimaPe founder Rahul Mathur, amongst others, highlighted the deficiency of this "outcome led" approach, with limited emphasis on "art" of learning and solving problems from first principles. There are multiple reasons Indian edtech has headed this way. Edtech firms are catering to a very well defined, and very large market.
There is no arguing about the fact that Indian parents are willing to spend on education if it guarantees access to to tier colleges, and therefore jobs. There is intense competition for good colleges and good jobs, so no one would begrudge a parent wishing to give her child the best possible chance to make it. Entrance exams are often the way to do this. In a country as populous as India these exams are often the most efficient way of administering admissions, even if they might not be the most efficient or fair arbiter of merit. Given this, I do think there is something to be said about the value of Indian edtech. If children get access to world-class coaching at home, instead of needing to decamp at Kota that is undoubtedly a good thing.
All that said, Indian edtech doesn't solve for some of the fundamental problems of education the country has. The country's primary education is broken. The state and private sector have prioritized tertiary education, but even here there is a shortage of good research institutions. These are not edtechs problems to fix, but I do think there are many issues in the education sector that are crying out for an innovative business model to tackle head-on. Will Indian edtech move beyond offering coaching classes to more immersive models of education (see, for example, Minerva Schools, Kahoot!, Tophat)? There's so much more we'd love to see in this space. I think India's edtech unicorns have the deep pockets to tackle really difficult problems - the question is whether they have the ambition and willingness to do so.
🗞️ News of the week
Meat delivery startup Licious is in talks to raise $80M that would value the company at around $800M
Salesforce Ventures made its first investment in India, leading the Series C of DarwinBox, the cloud-based HR management platform
Digit Insurance became the first Indian start-up to enter the unicorn club in 2021
Flipkart's $200M deal with Aditya Birla Fashion has been given the regulatory go-ahead, giving Flipkart an edge in e-commerce apparel
In one of the larger DNVB M&As in India, the sauces & dips company Wingreen Farms acquired Raw Pressery in a deal that values the company at around Rs 100 - 110 Cr
Live streaming and community gaming platform, Turnip, has raised $1.63M in a seed round led by Elevation Capital
📰 What we've read and listened to this week
Welcoming more voices by the Clubhouse founders
🎙️ Podcast of the week: Venture Stories: The Psychology of Money with Morgan Housel
📚 Book of the week: The Man Who Solved the Market: How Jim Simons Launched the Quant Revolution by Gregory Zuckerman
I read this book soon after it was published in Dec 2019, but thought it made for an apt choice since Jim Simmons stepped down as the chairman of Renaissance Technologies last week. The book tells the story of Simmons and his hedge fund, which is widely regarded as the most successful quant hedge fund in history. How exactly did the man do it, the book asks. It's a great read and I really can't recommend it enough.