Nesta’s recent Innovation Sweet Spots discovery work shone a light on the ever-evolving landscape of early years tech innovation, identifying a number of different areas of research & development (R&D), investment, growth and innovative solutions targeting the early years sector as a whole. Much of this work identified a number of opportunities that have a broader reach than just the early years (spilling out into broader EdTech territory), with the majority having a primary focus on children/young people or parent/caregiver-facing innovation. However, there were few examples that aimed at supporting professionals in their roles, or the wider childcare system, within the context of improving the quality of provision.

The ‘nursery tech’ sector, ie, innovation that supports professionals, settings and the system, represents a relatively small portion of the overall EdTech market, with our research suggesting around 300 start-ups spanning seven key categories: nursery management, parent engagement, finances, development assessment, workforce management, marketplaces and content and learning. AI adoption in this sector remains limited, with only a few companies integrating small AI features, such as assistants, chatbots, analytics and speech and recognition.

The work suggests that, although there is some growth and development in nursery tech, it is still small and a fraction of what its potential could be. Additionally, AI could have the potential to transform categories of nursery tech and problems to solve for practitioners, settings and the system, but this growth has not yet materialised.