Edukoya Bows Out, Returns Investor Capital After Three Years

Nigerian edtech startup Edukoya has ceased operations, citing market challenges and limited adoption. The company, which made waves with a record-breaking $3.5 million pre-seed funding in 2021, has opted to return capital to investors rather than push forward in an increasingly difficult environment.

Market Challenges Force an Early Exit

Edukoya revealed its decision in a statement to stakeholders, pointing to factors such as unreliable internet connectivity, restricted device access, and constrained disposable income as major roadblocks.“Edukoya encountered significant market readiness challenges in scaling our synchronous learning model,” the statement read.

Despite its vision to transform K-12 online learning in Africa, the startup ultimately concluded that the market was not yet ready for its offering. The company explored partnerships, mergers, and business model shifts before deciding to shut down.

A Vision Cut Short

Founded in 2021 by Honey Ogundeyi, Edukoya sought to bridge Africa’s educational gaps through digital learning and tutoring services. Ogundeyi, inspired by her own experiences navigating Nigeria’s education system before studying in the UK, was determined to provide better learning opportunities for students across the continent. “Even the most brilliant students can be let down by the system,” she noted in a past interview.

Edukoya’s impact was evident in its numbers. The platform reportedly served over 80,000 students, facilitated more than 15 million answered questions and hosted thousands of live classes. Yet, despite these achievements, scaling proved unsustainable.

Investor Confidence and Industry Implications

The decision to return investor funds rather than exhaust resources chasing growth has been viewed positively within investment circles.

One investor, speaking anonymously, remarked that the move “demonstrates an ability to recognise when market forces make VC-scale outcomes unviable and return investor capital, thus upholding investor confidence.”

While the amount to be returned remains undisclosed, Edukoya’s closure raises broader questions about the future of edtech in Africa. Despite promising projections—such as the sector’s expected $400 million valuation in 2024—scalability remains a hurdle.

The Future of Edtech in Africa

Edukoya is not alone in facing these struggles. Other startups, like Quizac, have also shut down, highlighting systemic challenges in the industry. Experts suggest that improved internet connectivity and infrastructure could significantly enhance edtech’s reach.

At the 2024 Mastercard Foundation Edtech Conference, Nigeria’s Minister of Communications, Innovation, and Digital Economy, Dr Bosun Tijani, stressed the importance of accessibility:

“Inclusion is the cornerstone of edtech. If we fail to reach all learners, we fail to fulfil our potential to revolutionise education.”

As Edukoya bows out, the question remains: can Africa’s edtech sector evolve to meet the needs of students at scale, or will similar startups face the same fate?