Albert Wenger of Union Square Ventures is an accidental iconoclast. He wants to disrupt (usurp!) the power of educational institutions, among other institutions, and give the “Power to the People.” He thinks it’s inevitable, good for the people, and good business.
It’s not a mean spirited interest. He’s looking at the inevitable economics of change. Craigslist didn’t hate newspapers, it just destroyed their cash cow (classified ads) replacing it with a simple free version for it’s own purposes. The newspapers’ printing press (that gave them eyeballs and classifieds revenue) suddenly wasn’t required.
Like many venture capitalists, Albert summarizes his extensive experiences into a few “characteristics” that can be used to judge ventures: “technology leverage, disruption of markets, no gatekeepers, capital efficiency, data asset/ network effect defensibility.”
It’s the third characteristic, “no gatekeepers”, that is most interesting to me strategically. For us, with Red Rover, the question is simply this – if we want to improve, or “disrupt”, higher education:
Should we work with colleges?
Albert, I believe, would say no, they are gatekeepers. It’s a big red flag for him. I spoke with him briefly, and he told me he is “not interested in the next Blackboard.” I think I can safely conjecture, based on Albert’s blogs and much of the discussion in those circles, that “the next Blackboard” would mean an incremental improvement based on the current business model. Nice, fine, but not fundamentally disruptive and therefore not so interesting. The idea being, one can’t simultaneously work with and disrupt the same folks. They will simply close the gate.
Let’s look at the landscape.
Starting with our old-school approach anchor:
Blackboard. Blackboard sells to schools. They are a 1.3 Bn company focused on providing a “single, seamless learning environment”. Web 2.0? We’ve got that! They solve the school’s problems with privacy and control and get paid for it. The students don’t much like it, but they have to use it. Blackboard cannot innovate for the students where their desires are in conflict with the schools.
Blackboard has a few open-source competitors based on a “single learning environment” approach. It’s a “power at the center” approach, but we’re interested in empowerment – power at the edges.
“The disruptive technology almost always takes root in a very undemanding application, and the established market leaders almost always try to cram the disruption into the established application.” -Clayton Christensen, author of “Disrupting Class*” (clearly on-topic).
The shift is from centralized to decentralized – it’s the opposite of Blackboard’s model, and no amount of embedding/cramming will change their underlying business model and structure. Following Christensen, we’re looking for something simple, with a new model, based on decentralized philosophies.
The scenario is easy enough to outline, as Albert does on his blog as well: the centralized university model was built on the scarcity of information. Libraries were a big deal, so gather ’round. Professor’s knowledge was a big deal, so gather ’round (and buy a very expensive ticket). Those things are not centralized anymore. Information is everywhere and often free. Professors and their bits of knowledge are everywhere, at all times, with text, audio, pictures, and video. Itunes U. MIT’s open courseware. Colleges are left arguing for their own necessity with “the people you’ll meet!” at the high end and “you’ll never be anything without a degree” at the lower end.
Leaving aside the degree issue, the info is there. The problem (expense) is now the navigation. If you’re interested in anything beyond the 1800 or so topics covered in the MIT courseware (or other repositories with curated taxonomies) it’s spread out all over the internet. It’s highly decentralized. This viewpoint is so common it is cliched in the ed-tech “echo chamber,” so let’s move forward.
Defining the Goal:
Let’s say education is growth. It’s X + 1. With X being where the learner is at with a given topic plus one step forward.
So the technical solution: peer-to-peer sharing of information “steps” so the learner can navigate through the noise. We need a relevancy filter by topic and level (x) plus a record of others’ exploration tracks to create scalable next step recommendations (+1). The more accurate we can make these two steps, the easier the navigation, the more people will participate, and the greater the disruption.
This isn’t new. Amazon.com does this wonderfully. Itunes’ “Genius” is decent as well (“If you knew a lot about music, this would be your next purchase!”). There are many examples.
In the digital InfoSpace, many folks manage this x+1 process through curation of their own peer learning networks – consisting of a mash-up of buzzing tools:
Twitter
Delicious
RSS readers
Disqus
Blogs**
Digg
Wikis, etc.
They create and manage a network of some relevancy and filter it with varying levels of success. Because this is working in practice, with a little effort, it’s obvious to these geeky folks that undergraduate education would be at least better, at most unnecessary, if more people did what they did.
But they don’t. Almost none of this excitement has had an effect on your typical college student’s education process.
Unfortunately, both disruptions and revolutions require participation.
So what characteristics can we cite so far?
Working with schools: Blackboard has both a business model and student usage. Sure it’s forced usage, but two checkmarks where it matters.
Not working with schools: The rest of the tools on the list above are simple and potentially disruptive as far as they facilitate x+1, but none have both revenue and students. Most have neither.
This is just the current state of course, and as a VC and entrepreneur, our bet is on the trend moving forward from this current state. What will change over the next five years?
What about other start-ups/growth stage companies in this space? Where are they betting? A quick sample:
With Schools:
Collegiate Link – “Integrated technology for student affairs.”
Inigral – “the first interoperable Facebook application designed for institutions of higher learning.”
Orgsync – “collaborative software for an online campus.”
Without Schools:
Popego – “Cut out the noise. Get a shortcut to the good stuff.” (I love this interface and it’s an elegant (x) relevancy filter tool)
Twine – “a new way to gather content and connect with people who share your interests”
Diigo – “a powerful research tool and a knowledge-sharing community”
Hybrid: (market straight to students, work with / get paid by schools)
Zinch** – “an interactive community of high school students and colleges. . . ” wanting to admit and be admitted to college.
Unigo – “College connected. Find, Review and Explore America’s Colleges” This one is questionably hybrid. Perhaps they are Without Schools. Seems like schools would likely be advertisers and thus b-model, but the money quote in their recent write up is “[colleges] should be a bit scared of [us], but they’re not. They don’t really understand the immensity . . .”
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So if you were a venture capitalist wanting to invest in disrupting education, in which category would you invest?
What do you think, should Red Rover hang out with Inigral and Collegiate Link, or Popego or Zinch?
More to come in Part 2.
