In week 3, we are invited to think about the processes behind the market-making for EdTech products using the example of Bridge International Academies, a for-profit education provider of low-cost schooling to children in India, Kenya, Nigeria, and Uganda. By reviewing the work by Riep (2017), we have analyzed what were the contributing factors to creating a market for Bridge Academies from their first school in Kenya opened in 2009 to becoming the world’s largest for-profit primary education chain (Wadekar & Grim, 2023). In this post, we will take a look at a number of these factors with a focus on the role investments played in making a market for this school model. I would also like to argue that the investment dimension plays a crucial role in the process of market-making and is often the hardest to track due to the complex interconnected systems of investment funds.

Riep (2017) builds upon the work of Preda (2009) drawing on the framework for market-making used to analyze the processes behind Bridge Academies network creation. These are grouped into two main categories of material and mundane aspects of market-making. Material aspects are represented by market devices (objects, tools, and technologies that make that contribute to the construction of a market) and market investments (capital investments by various actors that make the market-making possible)

In the example of Bridge Academies market creation, there is a number of market devices that are contributing. To begin with, there are devices helping to establish boundaries and identify the best locations for the new schools such as GPS mapping tools and surveys for market research. Then, there are the devices that provide the organizational structure for the schools such as smartphones, tablets, and the so-called “teacher-computers” that provide detailed instructions to the teachers whose role in this case has been rendered to be a programmable and automatable function. To qualify these market objects, different forms of data are deployed such as performance metrics, branding, as well as digitally scripted instructions and curriculum. Finally, there are devices that are used for mediating market transactions such as mobile payment systems, and also devices for generating new transactions such as sales textbooks, uniforms, etc. All together, these devices form an assemblage of materials artifacts making the market creation possible.

This set of market devices, however, needs a steady flow of investments. Without a supply of financial capital, it would be impossible to create the structure and operate the material assemblage required for market-making. In the example of Bridge Academies, the company had attracted as much as US$100 million of investment capital (Riep, 2017) from a long list of organizations which includes, among traditional venture capital firms, various government and international agencies. The US Government alone provided US$10 million in a long-term loan, and the UK’s Department for International Development (DFID) invested an overall of £21 million over a few years (Riep, 2017). Bridge Academies model was further endorsed and gained a stable reputation in 2014 with the World Bank’s IFC announcing a US$10 million investment in it.

To me personally, it was a revelation to discover that Pearson, the largest education company in the world, has also invested in Bridge Academies and benefited from their financial performance. Pearson is a small part of my investment portfolio with a fund that specializes in “impact investing” and prioritizes educational causes. It is interesting to see how without explicitly agreeing to do so, my investment portfolio also contributed to market investment in Bridge Academies.

Pearson PLC perfomance in my investment portfolio as of February 2, 2024.

To conclude, there are two main categories of forces behind EdTech market-making: material (market devices) and mundane (market investment). The latter is the underlying pillar that supports the creation and utilization of market devices and, hence, makes market creation possible. It is, however, often the most elusive and difficult to track due to complex interconnected systems of investment. While market-creation is not a negative phenomenon per se, it is important to understand how we might contribute to it as investors and be critical of the companies we invest in.

References

1. Riep, Curtis B. (2017) Making markets for low-cost schooling: the devices and investments behind Bridge International Academies, Globalisation, Societies and Education, 15:3, 352-366, DOI: 10.1080/14767724.2017.1330139
2. Preda, A. (2009) Information, Knowledge, and Economic Life: An Introduction to the Sociology of Markets. Oxford: Oxford University Press.
3. Wadekar, N., Grim, R. (2023) A IS FOR ABUSE: https://theintercept.com/2023/03/23/bridge-schools-africa-kenya-education/ (last consulted on February 2, 2024)

How do EdTech companies create markets for their products? / Marta Sukhno by is licensed under a