This document discusses key trends in educational technology (ed tech) in Asia. It notes that while most ed tech investment has been in the US so far, Asia is poised to become the largest market due to its large population and emphasis on education. It identifies several opportunities for ed tech companies in Asia, including the business-to-consumer market due to high education spending, the potential for mobile ed tech given Asia's mobile usage, and growing demand for language learning. The document also covers challenges of localizing for Asia and the need for more cross-border collaboration and specialized investors to help global ed tech solutions succeed locally.

1. ED TECH IN ASIA:
KEY TRENDS
Allison Baum,18 June 2015

2. INTRODUCTION

3. WHY BE HERE?
“We’re here to put a
dent in the universe.
Otherwise, why be
here?”
- Steve Jobs

4. Early stage venture investors supporting
exceptional entrepreneurs to build remarkable
businesses

5. WHO WE ARE
Allison
Baum,
Managing
Director,
Tokyo,
Japan
Ø Experience
in
educa3on
opera3ons
management
including:
curriculum
development,
marke3ng,
teacher
training,
real
estate
expansion,
hiring,
and
business
development
Ø Bootstrapped
and
launched
educa3on
business
in
Asia,
scaled
to
US$1mm
revenue
run
rate,
2,000+
students,
60
teachers,
6
employees
in
nine
months
Ø Ins3tu3onal
sales
and
trading
at
Goldman
Sachs,
8
years
investment
experience
in
public
and
private
markets
Tytus
Michalski,
Managing
Director,
Hong
Kong
SAR,
China
Ø 16
years
in
cross-­‐border
investment
experience
across
Hong
Kong,
Singapore,
Tokyo,
London,
Canada,
and
the
United
States
Ø Previously
Chief
investment
Officer
of
PMA
Investment
Advisors,
where
he
managed
both
regional
funds
and
the
equity
team
Ø Founding
member
of
PMA,
scaled
from
US$600mln
to
US$3bln
in
ins3tu3onal
AUM
and
sold
in
2006
for
US$200mln
Stephen
Forte,
Managing
Director,
Menlo
Park,
CA,
USA
Ø Tech
Strategy
at
Telerik,
US$260mln
exit
Ø Experienced
entrepreneur
with
5
successful
exits
Ø Mentor
at
Thiel
Founda3on,
ChinaAccelerator,
HAXLR8R
Ø Founder
of
Mach5,
a
Silicon
Valley
based
startup
accelerator
and
co-­‐founder
of
AcceleratorHK,
Hong
Kong’s
first
startup
accelerator

6. WHY EARLY STAGE?
RETURNS
ü Target returns 30% IRR / 5x TVPI multiple
ü Current portfolio on track to exceed targets
ACCESS
ü Diverse network of deals & people
ü Over 300 co-investors around the world
INNOVATION
ü Cutting edge technology, teams, businesses

7. THE NEXT FRONTIER

8. 2015 1800

9. THE RISE OF ED TECH
0
500
1,000
1,500
2,000
2,500
2010
2011
2012
2013
2014
Millions
Private
Investment
in
Learning
Technology
Companies
(US$
Millions)

10. THE RISE OF ED TECH

11. HIGH PROFILE EXITS
0
10
20
30
40
50
60
70
80
90
100
2011
2012
2013
2014
(est)
#
Deals
EdTech Exits +200% in 2014
IPO
M&A

12. ü 75% capital invested into edtech in 2014
was U.S.
ü 9/10 largest financings in U.S.
ü 60 million K-12 students
ü 96% of K-12 students in the world are
outside of the U.S.
USA HAS LED THE WAY

13. ASIA IS NEXT
US$59.90bn: Size
of global ed tech
market by 201816
600 million: K-12 students in Asia
5 years: Time until Asia is the
largest regional market 16
300 million:
People learning
English in China
195 million: College graduates in China by 2020
40% income spent on education

14. DEVELOPING ECOSYSTEMS
ü People
ü Connectivity
ü Capital

15. GRASS IS GREENER

16. LOCAL CHALLENGES
ü Localization
ü Business Model
ü Language
ü Culture
ü Values
ü Timing

17. ü B2C business models
ü Mobile
ü Language Learning
ü Exits
KEY OPPORTUNITIES IN ASIA

18. #1: B2C IN ASIA
ü 600 million K-12
students
ü 40% income spent on
education
ü 60-96% of secondary
school students
receive outside
tutoring

20. #2: MOBILE IN ASIA
ü APAC = 57.7% of the world’s
mobile phones
ü 80% of internet users in China
access via the mobile/tablet
ü Highest % mobile payment
users in the world

22. #3: LANGUAGE LEARNING
ü 300 million people
learning English in
China
ü 30% of foreign students
studying in U.S.are
from China
ü English skills correlate
with 30-50% higher
income

23. ü EducationTravel = US$80 billion / year
ü Language Education= US$12 billion /year
ü 80% students sent by agents

24. ü Mobile
ü Publishing/Media
ü Tech/ Gaming
ü Education
ü IPO
#4: EXITS

25. CROSS BORDER ACTIVITY

26. ü Global solutions
ü Local implementations
ü Cross-border collaboration
ü Global, specialized investors
WHAT’S MISSING?

27. GLOBAL CHALLENGES
ACCESS EFFICIENCY
ENGAGEMENT OUTCOMES
ü Limited
ü Quality vs.
scalability
ü High fixed costs
ü No infrastructure
ü Differentiated
learning
ü Motivation
ü Assessment
ü Relevancy

28. GLOBAL SOLUTIONS
ACCESS EFFICIENCY
ENGAGEMENT OUTCOMES

29. WHERE FRESCO FITS IN
ü Bridging the gap
ü Investing in scalable solutions
ü Dedication to sector
ü Early stage Capital
ü People first

30. HOW WE DO IT

31. “If you want to build a ship, don’t drum up the men to
gather wood, divide the work, and give orders. Instead,
teach them to yearn for the vast and endless sea.”
― Antoine de Saint-Exupéry

32. GET INVOLVED
“The people that are
crazy enough to think
they can change the
world are the ones
that do.”
- Steve Jobs

33. KEEP IN TOUCH
ü www.fresco.vc
ü allison@fresco.vc
ü @allison_baum