A guide on how to build a unicorn in Student Study Support

This is part 2c of our series on technology-enabled teaching and learning where we dig deep into the topic of teaching and learning Support in higher education covering trends, challenges and opportunities to build new edtech unicorns.

Introduction

If this is the first time you are encountering this edtech article series from Emerge Education, we highly recommend you later check out our first piece highlighting ‘Why we are investing in this space’ and our ‘Guide on how to build a unicorn’ that serves as an introduction to this deep dive.

Through our two previous pieces we have covered deep-dives into the Technology-enabled Teaching and Learning categories of Resources (read here) and Delivery (here). Businesses operating in this space have mostly had B2B business models and have often struggled to penetrate their markets at scale. This is the third and final category market deep-dive which now focuses on the category of student academic Support. This is category has traditional been B2C, where startups have side-stepped universities and built directly for students. It has seen the most successes the date, with companies like Chegg, Quizlet and Coursehero, with Covid further contributing to the exponential growth of this category.

Why is this the case, what is changing and what further innovation opportunities are there? This article provides the answers to these questions for founders and operators looking to understand and take advantage of opportunities in this space, as we analyse the digital teaching and learning category of Support against:

• (1) an overview of the current subcategories it consists of, referring to the old, conventional ways of thinking about teaching and learning and their market sizes
• (2) the key recent trends and innovations in the market covering the macro trends with the ups and the downs, as well as specific incumbent company trends
• (3) challenges in the space, explaining why these sectors have at times struggled to grow and what is preventing growth
• (4) the next generation opportunities for innovation, highlighting the 4 new subcategories we believe represent the next wave of future in this space, directly aligned against the existing conventional subcategories

Overview:

This category represents the services and tools for aiding and enhancing learning. Given universities do not offer a smooth and supportive learning experience, estimates suggest that up to 96% of college students require additional help at some point in their university experience. Learning support platforms have emerged around study materials, flashcards, homework and textbook solutions, alongside long established test prep providers. As this category evolves beyond easier sharing and access to learning assets, there are opportunities to innovate around the audio and video medium, subject specific offers, learning hubs and pathways, essay writing aids and communities centred around the audio and video medium.

Current Subcategories:

Study materials: Study materials represent study notes, guides and flashcards that help in the comprehension of academic resources and expediting of learning. The act of active reflection on academic resources is a powerful way for students to acquire knowledge and support each other through sharing materials. Since the beginning of formal education, students have used study materials often created by external providers. With the rise of the internet, few print content providers like CliffsNotes survived, as market dominance was built through user-generated content led by US leaders Quizlet, Coursehero and Chegg Prep, followed by mid-market players like StuDocu (Europe) and Passei Direto (Latin America).

Homework support: Homework represents active learning moments through which students practice and reflect on study resources in a structured manner to develop mastery of lessons. Textbooks have for a long time owned this space with add-on questions to textbook chapters. As students have encountered challenges in understanding and solving homework problems, with publishers hiding explanations and solutions, a support industry has arisen ranging from textbook homework answers, on-demand Q&A solutions through services like Chegg Study and more recently Coursehero, and even contract cheating.

Essay and test prep: Essays and exams often represent the end of class high-stake tests of knowledge. The average first-year US student writes almost 100 pages, while seniors write 150 pages through the academic year. In response, solutions that help with citations, grammar and plagiarism, liked Chegg Writing, have thrived alongside the $100m+ essay mill industry. Mid-market HE client size companies, like Grammarly support students with ‘polished grammar, better overall wordsmithing, and a professional writing style’. For exam-based courses, qualifications and degrees, especially around areas like English, medicine and law, a large, fragmented and mostly physical $450m+ general test prep market has arisen. We do not cover it in our market map given its current main focus on non-core education, like AP tests, SATs, TOEFL, MCATs etc.

Tutoring support: While teaching assistant support, study materials and resources can go far, there will always be cases where students need highly targeted and specialised human support covering homework, assignments, essay reviews and test prep. The global tutoring market is a large, fragmented market with an estimated size from $100bn to $200bn. While it is driven by Asia and K12, higher education still represents a sizeable and rapidly growing segment accelerated by Covid, led by companies like Varsity Tutors and Wyzant in the US.

Trends & Innovations:

Large centralized student resource pools: The study materials sector has seen many different companies attempt to build go to places for students to access, create and share study notes. Key challenges have always been around providing access to quality, large and broad enough content pools, where both external in-house material creators and fragmented user generated communities have struggled. The last 5 years have finally had winners emerge with ads or freemium business models, including Coursehero and Quizlet.

Grammar and citation support: The recent decade has seen an influx of citation support software businesses that have simplified the process of access, storing, correct capturing of academic sources and avoiding plagarism. Chegg became a market leader through numerous acquisitions for its Chegg Writing proposition. In addition mainstream grammar services like Grammarly have been useful essay writing aids for students looking for quick wins in their written language.

Homework step-by-step aids: As platforms have centralized and massively grown their data volumes, homework solution services have become better. Students can now find worked-out solutions to textbook questions through Course Hero’s ‘Textbooks Solutions & Explanation’ offering, use science software that gives worked-out answers to equations, and are even able to get automated responses to photos of math problems through various Chegg Study solutions and its Math Solver. It is important though to note that while students are less ‘stuck’ with homework now, some platforms in this space have enabled cultures of cheating to develop among students looking to hack the system rather than learn from worked out solutions.

Micro-tutoring on-demand support: The micro-tutoring market has grown around moments in which students are unable to progress using software solutions and university support. Students do most of their homework at night, yet most professors and teaching staff are available during the day. More students want support when they are stuck, not when they schedule an hour-long meeting with a tutor later in the week. Many gen Z students prefer support to be via instant text rather than video conversations. Successful propositions have grown solving for these obstacles of time, immediacy and convenience.

Challenges:

Lack of learning pathways: While today there is an abundance of study materials and resources in the market, there areno clear structure and simple personalized pathways for students to follow to get from a certain starting point to a required end goal. Many students are still ineffective in studying, finding and using the best and most time effective techniques and materials to optimize assignment and exam results. Today expensive tutors are the most likely creators of study pathways for students while most attempts at personalizing learning have been via courseware and B2B propositions rather than through B2C study resources.

Limited essay writing support: Writing is one of the leading skills deficits of graduates and more than 20m students consider writing help an ongoing need. Innovations in this space have only solved the problem around the edge. As a result, a large cheating ‘essay mill’ industry, still legal in many countries, has arisen helping students camouflage plagiarism and pay for bespoke essays. In the UK 1 in 7 students are reported to be paying for essays, a small proportion through thousands of essay mill websites and a majority through many general gig work platforms, making tracking and prevention difficult.

Student learning silos: While fellow peers are likely to be the best sources of support, current peer to peer environments are mostly based on content uploading and sharing. When it comes to human study support most technology solutions are focused on formal tutoring where students are supported by professional adult tutors. Students getting together in study groups is still inconvenient and happens either via fixed tutor study hours or through independently organized e-mails, messaging services and live meetups.

Tutoring business model challenges: The tutoring market is a competitive, labor intensive space resulting in high customer acquisition costs and low net margins. Matching supply and demand around very specific questions and topics is difficult. Tutoring-first businesses have had disadvantages against other new leaders in this space. New leaders have started their core offers around student searches for specific insights and materials like textbooks and study materials and upsold (micro-)tutoring, while tutoring incumbents has focused on general 1:1 physical or online live and synchronous tutoring support with much tighter financial margins. While the space now finally has its unicorn Varsity Tutors, with only $100m in revenue it faces a steep road towards profitability in justifying its unicorn status, compared to SaaS counterparts.

Next Gen Opportunities:

Subject-specific platforms: Not all subjects are created equal and are possible to study using the same tools and environments. While flash cards and study guides can play important content-agnostic learning roles, there are opportunities to create subject-specific learning platforms. They can cater towards high in-demand subjects and maximise impact and effectiveness of learning in each. Sciences and medicine are examples of good subjects to focus on. Another important and very relevant dimension for this subcategory is tailoring towards mobile formats that enable learning on the go through short and sharp content and intuitive user interfaces.

Examples in the medical space include companies like Osmosis and Amboss which support students on the highly stressful journeys of acquiring large amounts of medical knowledge and taking high-stakes exams. Unlike many one-core-feature apps in the space, these companies provide a broad range of end-to-end study tools ranging from question banks, articles, videos, note-taking features, study plans and performance analysis.

Learning hubs and pathways: As the amounts and availability of fragmented lecture and study materials grow, there are opportunities to create centralised student learning hubs and pathways. Such solutions can tailors towards the ups and downs of a semester and varying student support needs. They can also improve the time effectiveness of studying by helping students transcribe lectures and autogenerate summaries, store and organise knowledge, annotate and mark up materials and notes while offering and facilitating creation of personalised knowledge graphs and study plans. Building such platforms positioned around test prep is likely a strong entry point.

While students go to LMSs and study material access websites to download resources and leave, platforms like Study Smarter are building go to study environments for students to upload those resources and learn from them through various supportive tools. As such it is a B2C product serving the role that the LMS never achieved through its B2B enterprise proposition. Solutions like Google docs are the most commonly used today for students to take notes, make summaries and share knowledge. Platforms like RemNote take note-taking software to the next level by helping users organise their thinking and grow their knowledge through referencing, flashcards and knowledge sharing features.

Writing support: AI-support for writing better open-ended paragraphs and essays is one of the greatest technological challenges in education today. Even when the linguistics technology eventually gets there, with essay mill industries thriving and students not finding essay writing interesting or useful, this will be a very difficult industry to penetrate at scale. To succeed solutions in this space need to make open-ended essay writing feel like a manageable activity full of actionable, meaningful and immediate feedback for students. In a world of instant gratification, students want and need immediate feedback to understand how they are doing, how well they are progressing and how they can course correct faster and better.

Similar to grammar and Grammarly, those solutions that find ways to assess, give feedback on sentences and eventually paragraphs and full essays, like Ecree, will find big markets outside of education, as writing skills represent one of the biggest graduate gaps that follow them through careers. Rather than going after full essay-level feedback, companies like Quillbot are starting at a much more granular and tangible level, in helping students improve and paraphrase their sentences.

Video and audio communities: Video teaching content resources have reached a large scale through MOOCs, Youtube, and specialist providers. As gen Z bring social audio and video chat sharing and consumption to the forefront, and platforms like Loom (video), Clubhouse (voice) and Discord (chat / voice) rise, there are opportunities to build student learning community platforms around the video and audio medium. While student solutions today are transactional resource and homework consumption databases, there are big opportunities to make studying more social and inclusive especially considering those students that have reading disabilities, cannot afford expensive tutors or are at times more comfortable engaging online than in person.

Study time is a lonely time in the day of a student, especially during Covid. The average student spends 15 hours per week studying, encountering many distractions and opportunities for procrastination. Companies like Studystream are taking study groups and the library experience online helping students with focus and motivation. Companies like Echoist are helping students to manage their study time and resources through searchable and transcribable audio and video files they can annotate and share with peers.

Stay Tuned

If you have come this far, thanks for reading.

Over the last six months, we have had the pleasure of speaking with more than 50 UK universities and 30 leading edtech startups to inform this work. We hope this guide will help existing and future founders better understand this promising and complex online student academic Support landscape and better inform the direction of their businesses.

Next week we will be publishing the final post in this series, so stay tuned. We will synthesise all learnings and share 10 key pieces of advice for founders categorised against Product and Sales. Support category, so stay tuned. If you don’t want to miss it, sign up here to our edtech founder newsletter.

If you are a learning leader or educator interested in following our work, we would love to speak with you. If you are an ambitious startup founder building exciting solutions in this space, we would love to hear from you. Just send us a note here.

Acknowledgments

Andy McGregor, Deputy Chief Innovation Officer and Jisc

Ben Nelson, founder and CEO at Minerva Project

Corey Snow, Director, Education Industry Solutions at Salesforce.org

Curtiss Barnes, Senior Adviser at e-Literate

Damir Sabol, founder and CEO at Photomath

Dan Avida, co-founder and CEO at engageli

Dave Sherwood, co-founder and CEO at BibliU

Daphne Koller, co-founder and Board member at engageli, former co-founder and co-CEO at Coursera

David Minahan, Chief Information Officer at TEDI-London

Dror Ben-Naim, founder and CEO at Smart Sparrow

Gideon Shimshon, Associate Principal Digital Learning and Director of QM Online at Queen Mary University of London

Grant Lindsay, Director of Product Management at Chegg

Ian Dunn, Provost at Coventry University

James Kenigsberg, founding CTO at 2u

Jamie Brooker, founder of Kahoot & founding Partners at We Are Human

Joab Rosenberg, founder and CEO at Ment.io

Jonathan Baldwin, Managing Director Higher Education at Jisc

John Filmore, President, Chegg Skills at Chegg

Khaleeq Aziz & Abdullah Orkun Kaya, CEO & COO at Symanto Research

Matt Greenfield, Managing Partner at Rethink Education 

Mauro Calise, founder and Director at Federica Weblearning

Michael Feldstein, Chief Accountability Officer at e-Literate

Michael Soselia, Director of Growth at BibliU

Mike Silagadze, founder & CEO at Top Hat

Morten Andersen, Strategy and Business Development at Labster

Nachiket Paratkar, Senior Vice President, Higher Education at Learning Mate

Nathan Thompson, Vice President, Corporate Strategy &Development at EAB

Dr Philippa Hardman, Vice President, Learning at Aula

Peter Reed, Managing Director at Interactive

Prasad Mohare, Senior Vice President at Learning Mate

Rob Cohen, former COO/CFO & current Senior Advisor at 2U

Robert Purdy, Regional Director of Scientific Partnerships at Labster

Tom Davy, Managing Director at Panopto

Valentina Reda, Research and Academic Development at Federica Weblearning