As the new term begins, the familiar "back to school" feeling has started to sink in and we've been reflecting on how the education sector has evolved, and what the next year might bring.
At August Equity, we've been actively investing across the education sector for more than a decade, supporting ambitious management teams to build businesses throughout the education life cycle, from early years through to further education and professional training.
Over the last ten years we've backed ambitious, passionate management teams who are building platforms to support individuals and institutions throughout their learning journey, whether that be in nurseries, schools, SEN provision, or in the workplace through apprenticeships, eLearning, competency management, and professional development.
In this time, and more significantly in the last few years, we've seen technology move from the margins to the heart of how education is delivered, and how educators and learners are supported by technology to achieve better outcomes. The UK online education market reached £2.1bn in 2024 and is expected to reach £4.1bn by 2033. Across both the private and public sector, a forward-thinking digital strategy is becoming a necessity to remain competitive, enhance margins, and improve learner experience and attainment, particularly in highly regulated and price constrained industries.
The move towards digital-first or technology-enhanced learning is happening alongside a broader shift in how education is being funded and prioritised. In the UK, the education sector remains heavily supported by government, providing resilience in demand and a stable platform for growth. However, policy also matters. The recent creation of Skills England is driving a renewed focus on apprenticeships, skills, and workforce productivity, a trend we are seeing increasingly through our investment in the Impact Futures Group. In an apprenticeship sector that is becoming increasingly data hungry, providers need to adapt. Adopting best-of-breed technology solutions enables the creation of engaging learning experiences, drives organisational efficiencies, promotes data driven decision making, and allows educators to deliver the highest quality training and outcomes for learners and employers. In the last year, Impact Futures has managed to leverage its technology infrastructure to support an increase in learners on programme from 4,000 to over 5,000 today and following the recent acquisition of Captiva Learning, is broadening its offering across the education sector.
Across both the schools and corporate training landscape we're starting to see incredibly innovative and forward-thinking products launch in the market, leveraging agentic AI to create adaptive learning pathways and utilising technology to make learning more accessible and inclusive across organisations and communities. The UK eLearning market is expected to grow by 7.3% to £15.7bn by 2030 so providers who are adapting their content delivery model to mediums which learners are more familiar with from micro-learning and masterclass videos to gamification and cartoons will succeed by demonstrating how they are responding to changing learner consumption habits. Supplementing these digital content delivery models with face-to-face practical application, collaboration and discussion can provide a powerful combination to improve understanding whilst harnessing independent and critical thinking.
There are of course ethical considerations linked to the increasing use of technology and AI within the education sector, which if not governed carefully, can amplify inequalities, erode trust and undermine human agency and critical thought. However, education can position itself at the forefront of tackling these concerns with the UK government recently launching an AI Assurance roadmap to develop a skills framework, create professional certification pathways, and increase expertise in this area, increasing the £1bn market to £18.8bn by 2035. It’s clear the pace of change in the market is immense. Educational organisations, educators, regulators and learners need to work in tandem with EdTech businesses, entrepreneurs, investors and thought leaders to challenge each other and collaborate towards a future that promotes lifelong learning through adaptive, inclusive and engaging mediums, whilst also leveraging best-of-breed technologies to enhance business performance and learner outcomes.
Three areas we’re excited about at the moment are: (i) the use of technology to support highly regulated and technical training in high-stakes environments; (ii) EdTech companies supporting teachers and educators to give them more time in the classroom; (iii) assessments and the use of software to uphold academic integrity.
As the education world gears up for a new term, we’re looking to partner with the next generation of entrepreneurs and advisers who are shaping the future of learning, in classrooms, workplaces, and beyond.
