He is actively involved in the international startup – and specifically edtech – ecosystem, collaborating as a mentor or edtech expert with such communities as Reimagine Education, HundrED, BHeroes, StartED, Edmaven, SuperCharger Ventures and more. He’s participating, as a founding member, in the European Edtech Alliance.
Previously, Enrico was Director of Educational Digital Products at Zanichelli Editore. In this role, along with a most awesome team of three, he sustained senior management in working out the company’s digital strategy, and he led the creation of a modern software house in the middle of the 160 years old textbook publishing business as a sort of in-house startup.
Enrico graduated in Informatic Engineering at Università degli Studi di Padova.
Q: You spent many years of your professional career in Zanichelli Editore, and about three years ago you joined the startup industry, following your appointment as Director of Zanichelli Venture. Can you tell us about the decision to create a CVC structure? What is the mission of Zanichelli Venture?
Enrico: I started working at Zanichelli twelve years ago as an editor. Zanichelli Editore is the leading textbook publisher in Italy, and it always paid keen attention to innovation and changes in the social and economic context.
Thanks to a background that included IT skills, I quickly found myself involved in matters related to digital products and the then oncoming digital transformation of the Italian school system. Indeed, Zanichelli started experimenting with digital products in the early 1990s, first with reference books and dictionaries, then with assessment platforms and digital textbooks for the middle and high-school markets.
In this context of sensitivity to innovation, I began to lead the company’s Digital Department and, with outstanding team and colleagues, structure the development of new digital products.
Moreover, the senior management team has always fostered yearly visits to the US to meet our local partners and look at new trends and products.
On one of these trips, we attended the ASU+GSV Summit, which is perhaps the world’s premier event where startups with innovative ideas in education meet with investors looking for compelling investment opportunities.
Following this event, and at the same time Ferrante Enriques, a successful entrepreneur and angel investor himself, was joining the senior management team, the company’s shareholders decided to invest in a riskier than usual asset class, leading to the creation of our corporate venture capital.
Although they knew that I did not have any specific finance expertise, they felt that my product and market experience was what was needed, so I took the helm of this initiative.
Zanichelli Venture’s mission is to support companies that strive to improve the global education market, in an impactful and at the same time profitable way, along three axes: efficiency, efficacy, and equality. At the same time, the fund acts as an observatory for Zanichelli Editore, to imagine what the publishing house could become in ten years, amid the tumultuous changes taking place in the world of education.
Q: Zanichelli Venture is Zanichelli Editore’s venture investments arm, looking for and fostering innovative ideas in education. How is the CVC organised? What is the investment strategy of the fund?
Enrico: I think that the company’s culture plays an important role here: we prefer to keep things simple, or at least not unnecessarily complicated.
We are a small team: two people, Alessandro Camassa and I, who analyse investment opportunities, plus one person, Lorenzo Molinari, who curates our «Sights on Edtech» Medium page, where we regularly publish interviews with preeminent edtech founders.
The investment process is straightforward: my colleague Alessandro and I scout and evaluate opportunities; then, when we find an exciting opportunity, I make a case for it to our Investment Committee, which validates our assessment and decides on the investment. In this way, we can close an investment within a few weeks.
Compared to traditional CVC structures, we aim to behave like a financial VC, supporting the startups we invest in for the long term, helping them in all the ways they find useful, and stepping aside when we are not helpful.
There might be an interest for Zanichelli Editore to do a partnership or a merger/acquisition with one of these startups in the long term, but it is not essential.
We started out by investing in very early startups with small tickets. Now that we are maturing and feel more confident about our ability to evaluate deals, we focus on more mature seed deals, with tickets up to € 250k. We have also started to look at Series A deals too, with the possibility of investing up to € 1 million.
Education is a huge industry; we look at every sector, from early childhood to corporate training and lifelong learning. We are perhaps less interested in the K12 [primary and secondary education] sector, which is often complicated because it is very regulated and reliant on what is happening locally in each country.
Q: Edtech is now one of the most impacted industries by the Covid-19 pandemic. What are the top edtech trends that you see in the future? Anything particularly disruptive?
Enrico: I think that what happened last year has surprised everyone. When the pandemic broke out, nobody had a clear idea of the direction the edtech industry and investments would have taken.
In 2010, the global VC investments in edtech were $500 million; in 2018, investments hit the all-time record of $8 billion; in 2020 investment doubled the previous record and reached $16 billion.
Two-thirds of 2020 investments are Chinese: in fact, China is funding and building a monumental educational infrastructure. Almost half of last year’s investments went into unicorns and very large companies. From what I saw, early-stage companies remained well funded during the year too. However, this does not mean that a founder of an edtech startup has an easier time getting funded. We continue to see a strong division between founders who have already had successful exits and a strong network, – we’ve seen $15+ million seed rounds happening in 2020 – and new founders who need to build their reputation and network, who continue to struggle. The shortage of edtech investors covering the earliest stages of a company’s development, such as angels, possibly got worse last year.
In terms of trends, I can mention a couple of them based on my interests and the startups in my portfolio.
Since 2012, we have learned how to scale lectures online. The ubiquity of MOOCS (massive open online courses) and Coursera’s stock market listing remind us of the tremendous impact of that kind of innovation. However, starting from last year we have all learned that listening to a person, sitting in front of a laptop or a device, is not necessarily the most effective way to learn.
Today, I see startups trying to find ways to scale learning that are synchronous and active, fostering a dense interaction between instructor and students, and especially between peers. There are several good examples. We invested in Foundry College, which in a very pedagogically solid way offers a platform and a teaching method for synchronous and active online learning.
Another trend concerns adult learners. We are increasingly aware that more and more people need to continue learning throughout their lives, but we also know that when they start having a family and work commitments, they can no longer dedicate themselves to learning as they did in the first 20-22 years of their lives.
There are startups that are thinking a lot about how to integrate learning with the activities we already do daily. In our portfolio we have Mindstone, which is working on transforming the time we spend reading, watching videos, listening to podcasts on the web into structured learning paths, providing learners with tools based on solid learning science research.
Q: As an investor, what do you think of the Italian startup ecosystem? What developments do you see for our country?
Enrico: In Zanichelli Venture, we follow the Italian ecosystem closely, even if we have not invested in an Italian startup yet.
I always tell Italian startups that we are not interested in investing in them because they are Italian, we are interested in investing in them because they are at the same level as the best opportunities we see outside Italy.
As investment policy, I think it’s essential to focus on startups with the entrepreneurial vision to compete in the global market and not just in Italy. And indeed, there are startups in Italy that we would have loved to invest in, but they are so good that they don’t need us and are moving fast internationally.
I believe that the Italian ecosystem, particularly the edtech one, is still evolving. According to the Global Silicon Valley Handbook, among the 50 most innovative cities in the world, there are no Italian cities, although there are several European ones. The first Italian city is Milan, in 55th place, after Mexico City and before Lagos, reminding us of the rapid rise in the competitiveness of Latin America and Africa as innovation hotspots.
According to PWC, in 2050, the first three countries ranked by GDP will be China, India and the United States, which are, among other things, the three nations that now invest more in edtech and education. Germany will be the only European country in the top ten. Italy will be in 21st place, and again Nigeria will be in 14th place.
If these forecasts prove accurate, we are heading towards the middle of the century in a situation where emerging countries will occupy most of the top 20 places in terms of GDP; it will be a very different world.
To stay relevant in this world, in my opinion, we must get past the myth of Italian exceptionality, let go of dreams of autarky, be less tribal and be open to the ability to be contaminated by what we have around us in the European space, but also by what is far away, in more distant regions.
My advice to entrepreneurs who create startups and investors is to become contaminated – look over the Alps and across the Mediterranean. I believe that contamination is the only – albeit messy – way to accelerate the development of Italy’s ecosystem.
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For more info on Zanichelli Venture, visit: https://www.zanichelliventure.it/