Growth Factorials

I have seen the journey of many B2B edtech (selling products/ solutions to private schools in India) startups over the years. Most of them go through a strange phenomenon. I like to call it a 3-year fizzle. These startups secure early wins in schools based on the promise of new and innovative products/solutions. Despite initial successes, many startups lose their steam within three years of scaling their operations to say a thousand customers. This phenomenon doesn’t happen because of competition or funding issues. There are deeper issues that weaken the long-term sustainability of B2B edtechs in India. If these issues are considered and resolved while planning and developing growth strategies, B2B edtechs in India will succeed more often.

Key Challenges in B2B Edtech Scale Up and Strategies to Overcome Them

1. Early Wins Driven by Hype, not by the Intrinsic Need

Private schools are often eager to adopt new technology, especially when it is projected as a transformative solution. Sales teams frequently achieve early adoption through relationship-based selling or high-pressure tactics. But this initial traction can be deceptive. When adoption is driven by external persuasion rather than an intrinsic need for a solution, the schools’ commitment towards using the new product vanishes as soon as the novelty fades and they realise that the product does not match up to the promises made to them.

2. Vanity Metrics vs. Sustainable Metrics

Many edtech startups chase vanity metrics—number of customers signed up, revenue booked, etc. While these metrics are impressive on paper, they can hide real issues such as customers discontinuing after sign-up, inability to collect money from schools, or high customer attrition. These issues lead to troubling unit economics. Startups failing to develop sustainable unit economics often struggle to maintain growth beyond the early years.

3. The Need for Continuous Evolution of the Product and PMF

A product that solves a problem today might not be relevant tomorrow. To stay in demand, an edtech solution must adapt to new realities and consistently demonstrate value to its customers. Educational environments are dynamic, with curricula, teaching methodologies, and technology standards evolving continuously. Most edtech startups do not establish regular mechanisms for product evolution and innovation based on the changing environment. Once the initial version is launched and early adopters come on board, the traction in the market can slow down if the product is not iteratively enhanced. Without ongoing innovation, early success quickly turns into obsolescence—leading schools to gradually phase out the product.

4. Misalignment with the Complex Ecosystem

Schools are multifaceted institutions with varying needs, from curriculum standards and teacher training to infrastructure and budget constraints. Many edtech products are designed without a deep understanding of these complexities. Initially, a product might seem well-aligned with a school’s immediate priorities, but as those priorities shift, the solution becomes increasingly misaligned. This misalignment not only frustrates educators but also results in low renewal rates. In many cases, schools that once embraced a new technology eventually abandon it because the solution no longer addresses their evolving challenges.

5. Short-Term Gains vs. Long-Term Partnerships

Aggressive or overly relationship-based sales strategies can secure early deals. However, these approaches often fail to lay the groundwork for lasting, trust-based value-accruing partnerships. If a product is sold on the promise of innovation without a clear, ongoing value proposition, the foundation of the partnership remains weak.

6. Buy in beyond the decision-makers

One critical factor often overlooked by edtech companies is the need for genuine user buy-in. Many edtech solutions are sold directly to school owners or decision-makers without ensuring that the primary users—teachers and students—find real value in the product. When the end users are disengaged, school leaders change their minds and opt not to renew, regardless of the initial attraction.

In other words, it’s not enough to convince a school’s leadership to sign on; the product must also win the hearts and minds of its daily users, something that many edtechs ignore regularly.

7. Cash flow and bad debts

In the B2B edtech space, especially when dealing with private schools in India, timely collections can be a challenge. If startups expand rapidly into markets without scrutinizing the payment records and financial stability of their partner schools, they risk a cash flow crisis.

A sustainable strategy should involve a careful selection of partner schools—those with proven payment records and financial stability. This disciplined approach ensures that growth is supported by a solid, profitable business model.

8. Building brand equity amongst the School Leaders

For an edtech solution to remain relevant, it must consistently build a brand that resonates with school leaders and educators. This means continuously communicating the product’s evolution, how it adapts to the changing educational landscape, and how it meets the emerging needs of the schools. A thought-through approach to brand building through continuous engagement with existing customers as well as prospects by organizing educational seminars, and participating in recognized third-party events are a few ways in which this can be achieved.

9. A Phased Approach to Scaling

Rather than relying on signing up large deals at the beginning of the scaling-up process, building and selling comprehensive solutions or building large teams that often underdeliver, B2B edtechs must consider a phased scale-up. Start small—A few grades, a niche solution or focus markets—and then gradually expand the grades, offerings and teams, once tangible, long-term value has been demonstrated. This approach not only builds credibility but also establishes a foundation for sustainable growth through word of mouth and renewed contracts.

Balancing Growth with Sustainability

The story of many B2B edtech solutions in the Indian private schools market follows a very similar trajectory- build a good product concept based on a robust premise, develop a good prototype, onboard early adopters, scale to a reasonable scale and then fizzle out within the three years of scale up. While early traction may be secured relatively easily, if some of the above mentioned challenges are not resolved during the scale-up phase, edtechs fizzle out soon.

For edtech startups, the path to sustained success requires a balanced approach—one that prioritizes ongoing product evolution, aligns closely with the dynamic needs of schools and the market, and adopts a disciplined, financially sound expansion strategy. Only then can early wins transform into enduring success stories that continue to deliver value over time.