11 October 2017

Education startups: growing through playground gossip

Two educational startups have clocked enviable growth rates by tapping into the network effect of schools.

1. Switching schools

Launched last year, Mrs Wordsmith has already hit £775,000 in income but had to radically redesign its learning games for school as well as home.

London-based Mrs Wordsmith has turned an unlikely character into a blockbuster success: the dictionary. It has tasked itself with illustrating the English language, employing Hollywood-trained artists to use their storytelling skills to bring words to life in a new way.

Word of mouth

Less than a year since launching its first word-learning products, it’s brought in almost £775,000 in revenue and seen only 5% of its customers drop off. This success has been almost entirely down to the power of ‘viral word-of-mouth’ in classrooms and playgrounds, according to founder Sofia Fenichell.

Purchasing power

This wasn’t how Fenichell intended to grow her business. Initially, the company followed the money, zoning in on parental pockets, assuming the home, rather than the school, was where the purchasing power lay. It was designed as a subscription service, whereby parents and children would receive table mats, worksheets and flashcards each month – but Fenichell claims she has received over 500 enquiries from schools.

Group learning

‘A lot of schools have found out about it because kids have brought it in and shown their teachers,’ says Fenichell. ‘And dozens of headteachers have been recommending it – so it’s going both ways.’

Given its unexpected popularity in classrooms, Mrs Wordsmith needed to be redesigned. ‘The core product really isn’t very good for schools,’ admits Fenichell. ‘Schools have been using it one-on-one with students, and asking if we have something that might work better for group learning.’

Too much paper

In response, Mrs Wordsmith launched a new set of products in June this year which are more suited to schools. ‘From our conversations with consumers and schools, we realised there’s too much paper, and we need to make it more efficient, with more targeted learning,’ says Fenichell. Fenichell had initially designed Mrs Wordsmith with the aim of improving her own daughter’s literacy skills. She now helms a company earmarked for considerable growth in the ‘edtech’ space, through a system which can change how children improve their vocabulary. In June this year, Mrs Wordsmith raised £2m in funding.

Product pricing

The product’s received mixed reviews in online forums, with some parents praising its effectiveness, while others are fuming at what they consider exorbitant pricing – £19.95 per month for six months, or £105 upfront. Schools are nevertheless signing up in droves.

2. The quiz masters

Children using Kahoot persuaded their parents to use the quizzing app in their corporate jobs. Kahoot was designed to engage kids in the classroom and make learning more fun.

Word spread fast among children, teachers and parents. So effective was the word-of-mouth and the power of children as evangelists at home, parents began taking the quizzing app to work.

Of the Norwegian startup’s 50 million active monthly users, a million are corporate employees. ‘Parents say, “This is great, let’s use this at work”,’ says Kahoot CEO Erik Harrell.

‘It’s what’s fuelled our growth in corporates.’ PwC, an accountancy firm, and DNB, the largest bank in Norway, are already paying customers. Businesses in several sectors are using the app for internal training; in retail, which typically has a high turnover of both staff and products, it’s being used to train salespeople about what’s new in store.

Kahoot wants to have 15 million corporate users on board by the end of the year. To achieve this, it’s tweaking the app to allow further customisation. Businesses will be able to add company logos and colours, for example. The company insists it will still be geared to its original users: children.

Insight: Peer endorsement and word-of-mouth are powerful forces when it comes to selling to children. Educational products with kids’ approval can unlock parental, school and even corporate wallets.

First appeared in issue 19 Oct/Nov