Brighteye Ventures is a leading European venture capital fund focusing on Seed and Series A stage investments, leveraging deep experience in the education, tech, media and VC sectors. More information about the work of Brighteye can be seen in the embedded short video.
Alexander Latsis is the Managing Partner at Brighteye Ventures, with an entrepreneurial background in education, media, publishing, licensing, technology, entertainment and mobile software.
Brighteye and Alex Latsis recently published the results of a survey looking at international expansion within the Edtech sector. The PDF attachment provides Brighteye’s definition of Edtech.
Survey Overview
As per the Brighteye report, international expansion is defined as entering a new geographical market in addition to a company’s home market. The report is focused on the European market and on companies expanding into the European market, as companies with these objectives are the focus of Brighteye’s investment.
A total of 57 companies were evaluated using a 14-question survey designed to capture insights into key issues arising from international expansion or from plans to expand into new markets. The companies surveyed included companies that have already expanded, as well as those yet to expand.
The results of the survey were further substantiated by interviews with leading figures from the Edtech sector, including senior leaders and investors, each of whom has considerable experience with international expansion.
Target Customer Markets
The spread of target customer markets was relatively even across the 57 companies involved in the study. 19% were focused on schools, 17% on large companies and a further 17% on small and medium-sized companies. Another 17% were focused on consumers, 14% on governments and 12% on universities, with the remaining 4% targeting other groups.
Home and International Markets
The home markets of the companies involved in the survey were widespread. Most were in Europe, including firms based in the UK, France, Norway, Spain, Switzerland and Finland. The survey also covered several companies based in the US and Asia looking to expand into Europe.
Multiple Geographical Expansions
Many respondents showed a tendency to expand to more than one market at once. The average number of destinations for a first expansion was 1.5, showing a tendency to pursue expansion periods rather than siloed expansions.
Timelines
The timelines for expansion were surprisingly fast for many of the firms involved in the survey. A total of 82% of respondents had opted or had plans to opt for expansion with revenues lower than $1 million. Almost half of all respondents (44%) had expanded or made plans to expand with revenues of between $50,000 and $200,000, while 19% sought expansion at a time when revenues reached over $200,000 but before reaching $500,000.
Product Market Fit
The primary consideration for most companies in the Edtech sector when considering international expansion opportunities is not the size of the new market but how well their product or service will fit within that consumer base. More than half (60%) of those surveyed stated product market fit as the number one priority, with 21% stating market size as the leading consideration. A suitable regulatory environment was key for some, with 7% of respondents citing this as their primary consideration when considering their expansion options.
Expansion Budgets
Budgets for expansion were often lower than expected, with many companies stating they had reallocated existing resources rather than employing whole new teams when expanding internationally. 40% of respondents had an expansion budget of lower than $50,000, while only 11% allocated more than $1 million in funds.
The infographic attachment looks at the five-step process for international expansion as outlined by Brighteye.
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Alexander Spiro Latsis, Nobrow Ltd. founder, has more than a decade of experience as an entrepreneur in media and technology businesses. He has been the Managing Partner of Brighteye Advisors since 2017, working closely with Brighteye’s other Partner, Ben Wirz.
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