2023 and the Signs of Progress for Indonesia's EdTech Industry

The edtech heyday in Indonesia seemed to fade with the Covid-19 pandemic, but perhaps things are different behind the scenes.

How far have Indonesian edtech startups come since 2021, and how much room do they have for growth in 2023?

The Big Edtech Layoff

A total of USD 205 million in finance has been raised by Ruangguru by 2022. Schoters and Kalananti, two education startups, were also included in the company's services in July 2022. 

Schoters assists students in getting ready for undergraduate and postgraduate courses abroad, whereas Ruangguru's major goal is to prepare them for local university education. In the meantime, Kalananti targets a different market by teaching kids aged 5 to 12 how to code.

Everything appeared to be going smoothly until the corporation laid off hundreds of workers in November of the same year as a result of "the drastically deteriorating global market situation."

Ruangguru's competitors in the edtech space, Zenius, and Pahamify, have previously taken similar steps, citing the current economic climate as their trigger. Despite this, the spokesperson for Ruangguru proclaimed that their company remained positive about its prospects to "provide access to quality education services for all."

After all, according to Ruangguru, its services were used 200 million times per month in 2022, bringing in a total of 38 million users. It means that, despite the need to slim down their company and cut down on expenses, Ruangguru still has a lot of customers ready to pay for their services.

Staying On Top in the Post-Pandemic

While other Indonesian edtech companies like Ruangguru and Zenius were busy overhauling their corporate structures and service offerings in 2022, Cakap is already establishing its major focus.

Cakap is an Indonesian upskilling and career enhancement platform which supports 3 UN Sustainable Development Goals: Quality Education, Decent Work and Economic Growth, and Reduce Inequalities. The platform provides users with hundreds of courses on language learning, business, digital marketing, finance, cybersecurity, and many other topics.

Cakap had displayed successful results over the past year. In regards to his company’s success, the Co-founder and CEO of Cakap, Tomy Yunus, has expressed his gratitude for the consistency of his entire team.

He revealed that the company's focus lies on positive fundamentals and economic unit performance. In addition, he acknowledges the expansion into vocational education and blended learning services as the key to Cakap's success in 2022.

Cakap's revenue grows 10 times during 2020-2022. The service has more than three million users from the productive age group (20-39 years). Language (50%), Upskill and Business make the biggest contribution to the company's revenue.

The New Era of Edtech in Indonesia

Since 2022 is the year of transformation for many edtech startups, 2023 will be the year to put their new strategies in place.

With co-founder Sabda PS in charge, Indonesian edtech company Zenius is getting ready to implement its long-delayed business plans to become profitable this year.

"We hope to be sustainable and reach [profitability] in 2023 because our forecasts show that we are very close to it," Sabda, who was just named CEO, said in a recent chat with DealStreetAsia.

Referring to Business Ware data, the untapped market potential for edtech is still very wide. The edtech and smart classroom market in Asia-Pacific (Indonesia, Japan, India, Malaysia, etc) is estimated to reach USD 28,255 million in 2023 and will reach USD 95,029 million in 2027.

This big market opportunity comes from:

• elementary and secondary students who need online tutoring, personalized training, and a learning community
• universities that require massive open online course (MOOC) platforms, independent training certificates for students, and ICT evaluation facilities for campuses
• professionals, who need digital training in both soft skills (creativity, communication, adaptation, analysis) and hard skills (cloud computing, data, design, video editing, and programming)

According to Tech in Asia, at least 51 local businesses are engaged in the edtech service industry as of April 2022. These businesses offer national curriculum learning platforms, online vocational and digital competence certification services, as well as a variety of other educational offerings.

Companies with a business strategy based on vocational training and digital skill certification take the biggest piece of the cake. In Indonesia, there are at least 18 businesses that provide these services.

As previously mentioned, Cakap has taken the steps forward to vocational education in 2022. Meanwhile, skill improvement courses are also enlivened by a number of players, such as RevoU, Kuncie, Binar Academy, and many more.

It's clear that Indonesia's edtech industry has shifted to a different target market compared to before and during the pandemic. Things were rough for a while, since they needed to make several adjustments, but now, in 2023, it's time to chase after stability and profitability. The future seems promising for better access to quality education in Indonesia.

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