CNBC Disruptor 50

A lesson plan from tech giants on how to transform education

How tech is making its mark in the classroom

Technology has the potential to be a game changer for teachers in far-flung places and schools with few resources. A range of software platforms offer teachers the ability to learn from best practices, customize lesson plans, manage assignments and complete evaluations. Millions of students and teachers at all levels are already using educational software, and technology is only going to play a larger and larger role in the classroom.

Learning management systems, as they're called, are already a $5.2 billion industry, and they are projected to grow to $16 billion in four years, according to a Markets and Markets study. It's not just schools using this technology. Increasing adoption of digital learning among corporate organizations and academic institutes will contribute to the growth, as well as the rise of technologies such as gamification and virtual reality.

Among the leaders in the space is D2L. Its Brightspace software platform incorporates big data to help teachers manage their teaching as well as messaging and grading. It's used by more than 700 clients and 8 million students, including about half of K–12 and higher-education institutions in Canada.

Blackboard, which was bought by Providence Equity Partners in 2011, sells its teaching and analytics software platform to more than 16,000 clients, not just schools but also governments and businesses, reaching 100 million users worldwide. Blackboard helps teachers bring their classrooms online and helps provide students with customized programs.

Second-graders work with Apple iPads as part of their classroom work at Park Lane Elementary school, in the Canyons School District, in Sandy, Utah.
George Frey | Bloomberg | Getty Images

Tom Vander Ark, an investor in education technology and founding partner at Learn Capital, says this is just the beginning. "It's taken time to really develop new learning models that take advantage of platforms. But I think what you'll see in the next couple of years is that most schools become part of a platform network. A network that has a common learning model and a shared learning platform and professional learning experiences," said Vander Ark, who is also a partner in Getting Smart, an education advisory firm.

The tech giants are looking to tap into this market as well: Google, Microsoft and Apple each offer free classroom tools for students and teachers. Google and Microsoft, in particular, "have a very lightweight management system, and teachers around the world are adopting that and using it in class," Vander Ark said. "We've seen this voluntary adoption of free and inexpensive tools that have created a real bottoms-up wave. Teachers aren't waiting for their school board to adopt a platform. … The leading platforms are really enabling teachers to mix and match to meet the needs of individual students."

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Now Facebook is getting into the education business, helping Summit Public Schools, a Bay area charter network, develop a platform. "In addition to using it inside their network, they're sharing it. … Soon several hundred public schools around the country will have access," Vander Ark said. "I think that formula is going to prove to be really powerful to transform K–12 education."

One downside of the surge in interest in ed tech from these giants: It's put a damper on venture investment. Venture capital investments peaked in 2015 at more than $1.5 billion, declining to $930 million last year, according to PitchBook.