Most edtech companies either fail or deliver poor returns. Despite the intellectual sophistication involved, investing, especially at early stage is just gambling: monetised risk assessment. Gambling, contrary to popular belief, is an everyday activity. Should you cross the road now? Drive or fly? All calculated risks.
Corporate investors choose between listed and unlisted instruments. Everyone knows listed companies like Nike, Apple, and Macquarie Bank trading on NASDAQ, ASX, and LSE. Even people who think they have no skin in the game are involved if they have a pension, the exception being unfunded government Ponzi schemes like the England & Wales Teachers’ Pension Scheme.
More relevant in edtech are private unlisted companies, where you can (with real limitations) buy shares or instruments like convertible notes. Early-stage unlisted companies offer more upside and sometimes tax benefits like SEIS and EIS. Established unlisted businesses gain from long-term planning flexibility, lower compliance costs, and freedom from quarterly scrutiny.
Asymmetry of information defines both categories. In Australia and the UK, getting accurate data on unlisted companies is difficult and expensive. A good example: a 2023 article in SchoolsWeek about UK AI edtech CenturyTech featured its founder claiming it was “the big AI company not just in the UK, but Europe…and frankly the US.” Bold, but unsupported by the filings as CenturyTech still files under the UK Small Companies exemption, which requires meeting two of three thresholds: sub-£10.2m turnover, under £5.1m in assets, under 50 employees. In 2025 they had 89 employees (down from 111 in 2024) and accruals and deferred income of £4.6m. I’m glad I passed after a 2014 pitch by the founder at the old Free State coffee shop in Sicilian Avenue. Interesting, but trying to build tech, AI, content, and assessment simultaneously struck me as overreaching rather than ambitious.
What’s changed is the tools. After years running my POPEYE investment model alongside endless Companies House trawls, I can now drop filings straight into AI. With thoughtful prompting, I get fresh analysis to which I apply experience and horse sense. A recent run on a well-known London edtech (one where I’d been offered shares that never materialised) revealed the founder was no longer the majority shareholder, the quantum of a recent funding round, and the identity and background of the new controlling investor. A similar analysis on another company described it as “technically insolvent”(obvious for years) and flagged that what looked like a fundraising round was really an existing lender extracting warrant coverage as consideration for rolling over distressed debt.
Which brings me to listed companies, and one I’ve always liked but thought shouldn’t have listed: Australian assessment tech business Janison. Founded by Wayne Houlden in 1998, it listed on the ASX in December 2017 via a $10m backdoor listing of shell company HJB Corporation (shares at $0.30, market cap circa A$40m). Its main revenue driver is the contract to run the NAPLAN schools tests via a deal with Education Services Australia that began in 2018 and was extended in October 2023 for six years for A$24–26m.
Janison’s share price peaked at $0.66 in early 2023, fell to $0.24 by October, briefly spiked to $0.355 in February 2024, and has since seriously underperformed the ASX Software and Services category, currently trading at A$0.12. The 2025 sector-wide SaaS sell-down hasn’t helped, but Janison also suffered a recent tech failure that disrupted NAPLAN tests for as many as a million students, along candidates sitting professional accountancy exams. Last year’s revenue rose nearly 9%, including a new $21m contract with the New Zealand Ministry of Education, but investors are focused on the 32% drop in EBITDA.
It’s a perfect storm: sector sell down, technical failures hitting their most important clients, and soft results. Add the current geopolitical uncertainty and I feel almost sorry for CEO Sujata Stead as I’m sure several predators are already running the numbers. I’m surprised RM plc hasn’t made an approach. Their numbers are looking considerably better (operating profit up 32%, assessment revenue up 20%) than 18 months ago, when someone close to the business told me they had “no headroom for takeovers” and were “sailing very close to their banking covenants.” RM raised £12.8m in October 2025 to reposition itself as a high-growth assessment business. Other potential suitors include Pearson, AQA, ETS, HMH, and funds like Francisco Partners and Vitruvian Partners (investors in Twinkl).
The core problem for Janison, RM, and their peers is institutional shareholders with no patience beyond quarterly performance. If your investment has halved and the company isn’t paying CPI+ dividends, most fund managers, or their trading algorithms, will offload or short the shares, regardless of whether revenue and profit is actually improving. In Janison’s case, with no profit and no dividend ever paid, that pressure is acute.
Delisting looks like the most viable exit from this trap. The question is whether that’s led by Ms Stead and her existing team/investors, or whether they’re forced to accept an external potentially hostile bid.
Having spent four decades investing in listed and unlisted companies, I think the latter is a better model for edtech, particularly if you can find patient long-term partners, as Twinkl did with Vitruvian Partners. For unprofitable AI edtech like CenturyTech, survival is possible (none of my three AI systems thought it likely), but perhaps their new deal with Nadim Nsouli’s Inspired Education Group (IEG) – not to be confused with Inspired Learning Group, will change the trajectory. IEG is a one of the two best international private education companies (the other being Nord Anglia). IEG previously tried a similar approach with CenturyTech at Portland Place School in 2021, however whether this was successful is impossible to determine as the school closed in 2024.
Edtech is brutal regardless of listing status, funding level, or quality of product and leadership. As I said: it’s gambling. Sometimes a long shot storms home. But the odds always favour the bookies.
