A New Cycle in Education: Where Capital and Demand Are Shifting
The fifth edition of Baird’s Back to School Report explores how funding priorities, AI adoption and student expectations are reshaping education and investment opportunities.
Education is moving beyond the post-pandemic expansion phase into a more selective market. Schools are reassessing what they fund, technology buyers are demanding evidence of impact and students are placing greater emphasis on career value. Across the sector, measurable return on investment is becoming a common standard.
In the fifth edition of our Back to School Report, Baird’s Knowledge Solutions team examines five themes shaping the next cycle—from the K-12 funding reset to evolving opportunities in higher education and Europe. For education businesses and investors, the opportunity is increasingly defined by meeting durable needs, integrating into established workflows and demonstrating clear value rather than relying on broad market growth.
Key Themes
- The Funding Reset Favors Essential Needs
As emergency funding ends, spending is shifting toward mission-critical needs, making budget resilience and state-level dynamics key considerations for providers and investors. - AI Moves from Experimentation to Measurable Impact
Districts are prioritizing AI that demonstrates clear learning or operational value, integrates into existing workflows and meets governance requirements. - Integrated Platforms Reshape EdTech and M&A
Schools want connected technology that simplifies operations, shifting M&A priorities toward genuine integration rather than collections of point solutions. - Higher Education Competes on Student Value
As students prioritize cost, time and career outcomes, opportunities are emerging for institutions and specialist providers that deliver tangible value. - European Opportunity Requires Regulatory Readiness
Europe’s fragmented markets create consolidation opportunities, while regulatory complexity makes compliance, data governance and cross-border integration critical to success.
Access the 2026 Back to School Report for Baird’s perspective on these shifts and their implications for education businesses and investors.
Connect with Our Team
We welcome the opportunity to discuss these themes and how Baird’s Knowledge Solutions team can support your business growth and strategic objectives.
