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Where Has All the Edu-Tech Spending Gone?

Earlier this week, President Obama said that he’d like to see the economic stimulus package include more education funding.

“I’ll be honest with you, the Senate version cut a lot of these education dollars. I would like to see some of them restored,” he said.

But the latest version of the economic stimulus package, which was pared down to $790 billion and passed by the U.S. Senate, removed $16 billion from the original bill for K-12 school construction, trims more than $1 billion from Head Start programs for youngsters and cuts $40 billion from a $79 billion proposal to help states pay education costs while trying to balance their own budgets.

All that trimming sounds pretty bad if you work in education, or if you are married to a teacher (like I am) or you invest in education.

But a couple of VCs who are paying close attention to the education portion of the stimulus package are Javier Rojas and Eric Filipek, managing director and principal, respectively of Kennet Partners.

Rojas says he became more interested in education technology investments when he saw a digital whiteboard being used in his daughter’s classroom. And he has watched his son use BrainPop, an educational website with hundreds of short Flash-based movies for K-12 students.

Rojas expects that much of the education-related spending from the stimulus package will go to education technology.

“More and more content is coming from the Internet and going into the classroom,” Rojas says. “So improving classroom technology is going to be a key component of education spending for years to come.”

Putting its money where its mouth is, Redwood City, Calif.-based Kennet last month invested in two education technology companies. Kennet led a $12 million Series A funding of State College, Pa.-based Schoolwires, which provides online portals for K-12 schools. And Kennet led a $10 million Series A round for Santa Clara, Calif.-based Go Internet, which operates an Internet advertising network and provides leads generation for colleges and universities.

Education is a good growth sector, say Rojas and Filipek, who add that Obama’s call to invest in technology that supports education will become a growing trend.