What are the real prospects for Russian EdTech in the CIS markets?

Contents:

• Markets are growing in all segments, but in different directions
• A local team is needed for scaling
• Russian-language products will not be enough for development
• Whether traditional business models will work is debatable

At the end of June, the Smart Ranking agency, together with Lerna CIS, part of the Skillbox holding, held a webinar dedicated to the development of the EdTech market in the CIS countries and the strategy for promoting Russian companies in this segment. The focus was on two countries: Kazakhstan and Uzbekistan. The webinar served as a platform for discussing current trends, opportunities, and challenges facing educational technologies in these regions. Participants received valuable recommendations on effective methods for entering the market and adapting products to local needs.

The analysis and discussion held during the webinar confirmed the high and growing demand for educational products, especially online ones, in these markets. This opens up opportunities for Russian EdTech players to successfully expand their presence into neighboring countries. However, entering these markets is fraught with certain difficulties that are often underestimated in Russia.

The webinar, which featured Dmitry Gavdur, CEO of Lerna CIS, Alisher Fozilov, Co-Founder and Commercial Director of SF Education, and Ekaterina Mareeva, Director of Regional Development at Sciencely, provided important recommendations. Experts emphasized several key nuances that should be considered when implementing educational projects and startups.

Markets are growing in all segments, but in different directions

At the webinar, Ksenia Zaitseva, Head of Research at Smart Ranking, presented the agency's first rankings of EdTech companies in Kazakhstan and Uzbekistan. These rankings show that both markets are actively growing. At the same time, demand is increasing not only for educational products for children, as is observed in Russia, but also for courses aimed at teaching adults professional skills, including long-term continuing professional education programs. As in Russia several years ago, the main interest in these countries is focused on online training in digital professions, which is driven by a desire to master the IT field. However, despite these general trends, there are significant differences in the characteristics and needs of the markets in Kazakhstan and Uzbekistan.

Dmitry Gavdur commented on the differences in demand for online education, focusing on the market prospects in Uzbekistan. In his opinion, this market has high potential for rapid growth for companies in the field of digital professions. The level of development of these professions in Uzbekistan can be compared with the situation in the Russian and Belarusian regions in 2018-2019. The country is experiencing a shortage of IT specialists, and the main demand for training is focused on in-demand professions typical of EdTech companies, such as programming, marketing, and design. According to Lerna CIS's experience, companies in the adult education segment in Uzbekistan can demonstrate annual growth of tens of percent, while the children's segment is also actively developing due to a more favorable demographic situation compared to Russia and Belarus. "I foresee a significant leap in Uzbekistan," noted Dmitry Gavdur.

According to Dmitry Gavdur, in Kazakhstan the adult segment of additional vocational education (APE) has already passed the peak of popularity IT professions are still growing, but they haven't yet begun to stagnate. The greatest prospects in this area lie not in traditional courses, but in training in artificial intelligence (AI). This is due to the implementation of several government programs, including the initiative to create a major AI hub in Central Asia. This focus on AI opens up new opportunities for professional growth and advanced training, making training in this field particularly relevant. Courses on the use of generative neural networks are becoming increasingly popular across various professional fields. In the spring of 2025, over 100,000 people completed training on the Lerna CIS platform, in partnership with the Ministry of Education of Kazakhstan and the Astana IT Hub. These courses are aimed at developing skills in working with neural networks, enabling specialists to effectively solve modern problems.

A local team is necessary for scaling.

Working in the markets of Kazakhstan and Uzbekistan presents significant opportunities for Russian EdTech companies due to their broad promotion prospects. For example, social media, which are subject to advertising restrictions in Russia, can be effectively utilized here. However, marketing in these countries requires taking into account specific local conditions. As experts Ksenia Zaitseva of Smart Ranking and Dmitry Gavdur noted, Telegram plays a key role in Uzbekistan. This messenger not only serves as an important channel for attracting traffic but also serves as a full-fledged platform for educational processes. It is important to note that access to specialized LMSs for online schools is still limited in some regions due to low internet speeds, although this indicator is gradually improving, as Dmitry Gavdur noted. As a result, simple courses offered via messengers are becoming more popular among users. To successfully scale a business in Kazakhstan and Uzbekistan, it's crucial to have specialists with experience in local markets on your team. By hiring a local team, a company gains access to unique local characteristics that are difficult to discern without deep understanding of the culture and consumer habits. This is considered axiomatic for companies seeking to enter international markets, as was the case with Russian EdTech companies actively developing in Latin America and Southeast Asia. However, when expanding into the CIS, the need for local specialists isn't always perceived as obvious. Alisher Fozilov emphasizes that although many residents of neighboring countries speak Russian, this doesn't guarantee similar marketing characteristics to those of a Russian audience. Differences exist and may not be obvious to outside observers, highlighting the importance of local knowledge and experience in a successful strategy for entering new markets.

According to Alisher Fozilov, SF Education successfully transferred its marketing and other functions to Lerna CIS. As a result, Lerna CIS created a full-fledged service to support the scaling of EdTech projects in the CIS countries. This service is based on experience working in countries such as Belarus, Kazakhstan, Uzbekistan, and Kyrgyzstan. The solution developed by Lerna CIS has proven effective for companies that are not prepared to make significant investments in building a team in a new country.

For successful promotion and development, a company needs close ties with local stakeholders. Relying solely on social media won't yield the desired results. For example, when entering a new market, a company often resorts to event marketing, organizing free natural science festivals that attract the target audience. It's also important to actively seek out partners for collaboration, which helps strengthen its position in the new market and expand its influence.

We usually either visit the city ourselves or hire a local specialist with a good understanding of the local culture. Several months before the project launch, this person meets with key players who could be beneficial to our cause. These include school principals and representatives of organizations with whom we can establish partnerships. For example, if we have environmental programs, we strive to collaborate with companies engaged in sustainable development.

Russian-language products will not be enough for development

Webinar participants noted that Kazakhstan is seeing a growing demand for educational products in the Kazakh language. This trend, according to Dmitry Gavdur, has become increasingly pronounced in recent years. According to Smart Ranking analytics, the growing interest in such products is confirmed by statistics. The education sector is adapting to user needs, which opens up new opportunities for developers and content providers.

Ekaterina Mareeva from Sciencely noted important aspects faced by companies developing offline projects. The first nuance is that audiences can vary significantly in different cities. For example, in Almaty, the company's clubs were initially aimed at a Russian-speaking audience, but an attempt to launch a Kazakh-language program was unsuccessful due to low demand. This is due to the fact that the main target audience, consisting of families with school-aged children, remains predominantly Russian-speaking in Almaty. However, in other cities of Kazakhstan, such as Shymkent, where Sciencely plans to open a new branch, the situation is different. There, the company intends to offer products in two languages, taking into account local preferences and needs.

The second important aspect for EdTech companies offering exclusively online products is to avoid focusing solely on audiences who have emigrated from Russia. This approach may seem appealing, as working with this group seems easier. However, as Ekaterina notes, attracting such an audience may be easy, but it will quickly exhaust its resources, as it represents a narrow market segment. Adapting to a wider audience will be difficult in the future, which could negatively impact sustainable business growth. To successfully expand into international markets, it is necessary to consider more diverse target groups and their needs.

Will traditional business models work is debatable

Alisher Fozilov expressed his view on the situation in the EdTech sector in the CIS. He believes that to successfully enter the CIS markets, Russian EdTech companies need to completely revise their business models. Fozilov is confident that EdTech startups from other CIS countries currently have a better chance of successfully penetrating the Russian market than Russian companies do of expanding within the CIS. Alisher Fozilov's pessimistic outlook on the scaling of Russian EdTech companies is explained by the fact that many market participants have not adapted to the decline in venture capital valuations that occurred in 2022. Furthermore, many Russian educational companies face a lack of resources to test new hypotheses in other markets. This creates significant obstacles to their growth and development in a changing market.

The main reason is that the business model is unsustainable, and unit economics are not demonstrating positive results. In Russia, EdTech companies face the problem of an overabundance of educational products, especially in adult education, which complicates their support and development. This leads to outdated programs and materials. As I mentioned earlier in one of the forums, the current situation in the EdTech market indicates its transformation into traditional adult education in Russia. Methodologies, work processes, and approaches to creating products are becoming outdated, which negatively affects the quality of education.

Alisher believes that players The EdTech market in Russia and the CIS needs to recognize that online education has become a mass product, and its cost should be more affordable. In Russia, this issue has become pressing due to lending restrictions caused by the increased key interest rate. However, in the Uzbek market, it is important to offer more compact and affordable products from the outset. First, there is high demand for short-term courses that teach specific skills. Second, selling long-term courses can be risky. Alisher explains that it is difficult to convince someone to purchase a course for several thousand dollars if their salary is significantly lower. Although banks may approve a loan, this could be the client's fifth or sixth loan. He emphasizes that in Uzbekistan, Kyrgyzstan, and Kazakhstan, high average purchase prices can only be achieved through upselling new short-term products and increasing customer lifetime value (LTV).

Alisher Fozilov presented his position at the webinar, sparking interest from other participants. However, Dmitry Gavdur noted that he disagreed with all of his assertions. In his opinion, Lerna CIS's experience demonstrates that Russian EdTech products, slightly adapted to local conditions, are successfully sold in the CIS markets. This confirms that long-term courses and methods familiar to the Russian market still find their audience and work in these countries.

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• Experts predict growth of the EdTech market in the soft skills segment
• The rating of EdTech companies for the first quarter of 2025 has been published
• What is happening with the demand for courses in IT professions?