Wednesday, Area9 announced a $30 million investment from The Danish Growth Fund, a state investment fund in Denmark – an amount described in the press release as “considerably larger” than its previous investments. Christian Motzfeldt, CEO of The Danish Growth Fund, said in the release that the firm anticipates “a revolution” in learning, thanks to artificial intelligence and adaptive learning algorithms, and is focusing more on edtech due to the “potential for innovation and ‘excellent’ market opportunities.”
The corporate training industry has seen perhaps unprecedented funding in edtech in the last couple of years, thanks, of course, to the unprecedented developments in technology in general. Adaptive learning, the focus of Area9’s training products, is one of those developments. Using adaptive technologies, employees can now experience personalized learning and receive custom curated content based on their individual needs. Such personalization increases learner engagement and retention, thereby improving the ROI of training.
Area9 was founded almost 20 years ago and includes two businesses: Area9 Innovation, a computer science company, and what is now, with the new investment, renamed Area9 Lyceum. Area9 Lyceum combines Area9’s learning business with its majority share of Area9 Learning, in which McGraw-Hill Education has a minority stake after a 2014 sale.
Area9’s platform uses continuous self-assessment and algorithms based on cognitive science to adapt learning by providing more content in areas where the learner has knowledge gaps until he or she has achieved competence. According to Ulrik Juul Christensen, chairman and CEO of Area9, its new “fourth-generation” platform, Rhapsode, expands the tool’s ability to adapt learning at any competence level. Previous generations worked well with higher education, he said, because students in one class tend to be at similar levels of competence. In corporate training, however, learners can be anywhere from beginners to experts in a skill or knowledge area. These learners need a more advanced platform that will adapt to any level, and Area9 plans to use some of its new funding to continue developing and rolling out Rhapsode.
As the amount of online content continues to grow rapidly, curation of that content becomes more important. The machine learning algorithms powering adaptive learning platforms makes that curation easier by automatically recommending content to learners based on their experience and assessments in the platform. That content, according to Carol Leaman, CEO of Axonify, helps organizations “strategically and surgically close knowledge gaps.” Axonify raised $27 million in 2016 to expand its business, which also uses adaptive learning to personalize training and automate content curation.
These investments are signals of the growing use of – indeed, reliance on – technology to provide effective training in the workplace. They are also, according to Christensen, evidence of what he thinks will be the biggest trend in corporate L&D this year: being able to measure training and demonstrate its ROI. Historically, executives have not understood the value of training to the business, and learning leaders have had a difficult time proving it. However, Christensen says, “I think we’re at the inflection point where corporate education will change toward something where we measure whether it really works, and we place the dollars where there’s an impact.”
As training organizations continue to implement effective solutions, quantify their impact and prove to executives that learning really does have a measurable impact on business success, adaptive learning is likely to play an important role. The market, with investments in companies like Area9, is responding accordingly.