How to Survive in Edtech


How to Survive in Edtech

LearnLaunch conference confronts pragmatic questions for edtech startups

By Tony Wan     Feb 4, 2013

How to Survive in Edtech

It's time for the edtech industry to grow up. That means moving beyond the grandiose statements about "change" and "revolution" and tackling the nuts and bolts of turning ideas into sustainable businesses.

At LearnLaunch’s inaugural conference, “Across Boundaries: Innovation & The Future of Education,” keynotes, panels, and conversations tackled pragmatic issues: How should entrepreneurs develop relationships with schools and actually sell to them? How do they find that repeatable sales model and be realistic about their exit strategies?

The business-oriented focus was certainly a refreshing change for this attendee, who at other conferences is used to seeing people spout off Big Ideas rather than execution.

Over 400 attendees showed up at the MIT Tang Center, with a respectable showing by teachers and educators (Roughly 25%, estimates LearnLaunch co-founder and tireless organizer, Marissa Lowman). A recent BostInno article boasted that the New England area was home to 150 education technology startups, though you might have trouble believing the number if it weren’t for the efforts of LearnLaunch to surface this community to the public eye.

The Eastern Corridor

Expect to see more--perhaps many more--to come. The big announcement at the conference was LearnLaunchX, Boston's edtech incubator/accelerator program, which will begin accepting applications on February 20 for its first cohort in summer 2013. Couple this with the official debut of Socratic Labs' first class of nine startups, and that makes two edtech accelerators within 250 miles of one another.

This may conjure up images of a Yankees-Red Sox rivalry. But both newborn incubators stress collaboration and sharing opportunities among their cohorts. Socratic Labs co-founder Heather Gilchrist told us that entrepreneurs from both accelerators will participate in an "Edtech Passport" program where they’ll be allowed to travel to either workspaces to attend classes, mentoring sessions and access other services offered by one another.

Schoolhouse Rock

There was no sugarcoating the difficulties that entrepreneurs face and definitely no golden tickets. A third of the dozen breakout sessions, along with a keynote, were devoted to how to get products into K-12 and higher-ed institutions. And these conversations certainly did not shy away from tackling the thorny issue of working with public school districts.

Educators on these panels shared the obvious: personal relationships are key to getting your foot in the door. And hopefully, you’ve done your homework identifying the key person in charge of tech implementation (not the superintendent) to ensure you’re knocking on the right door.

Once you get there, construct your message carefully. Jed Lippard, Head of School at Prospect Hill Academy Charter School, shared that schools “are mission-driven...Rather than going for a mass appeal, align your strategic vision and priorities of that school.” And articulate your value proposition in layman’s terms, suggested John Antonucci, Superintendent at Westwood Public Schools. “Superintendents and educators aren’t trained like business folks. They’re not necessarily familiar with terms like ROI.”

Deb Socia, Executive Director of Tech Goes Home, succinctly summed up the advice from the educators present: “Change happens at the speed of trust.” In the absence of evidence-based research--as is true for most new edtech companies and tools--schools will always reference check with others to learn about both the intended and unintended consequences of implementation.

Flipping the Switch

Serious questions were raised concerning the viability of the freemium model. It may be a great way for lean startups to drive user adoption and attain that cliche hockey stick, but how does it translate into revenue? Education Elements CEO Anthony Kim believed that "pricing is a real issue in this space. We can't continue to offer stuff for free." Jordan Meranus, CEO of newly-funded Ellevation, urged fellow entrepreneurs to "move very quickly from freemium to charge. The longer you give it away, the harder it is to flip the switch on." John Katzman of Noodle Education and 2U boldly declared that “The free is the enemy of good. The people who are building the best content are going to want to be paid for it.”

When VCs (particularly on the West Coast) place money in startups that have great user adoption but not much of a proven revenue stream, they’re betting that purchasing power in schools will be decentralized so that teachers will exert more influence in buying decisions. The question is: will this happen fast enough before these startups run out of time and money?

Katzman's Predictions

The relentless education entrepreneur John Katzman closed the conference with five predictions:

  1. The people in ed and edtech who fail will be the little ones who are going after little problems. They are building features, not products, and they’re not using data well. Compound this with the fact that education is the slowest moving marketplace on earth. This is a trust-based market and your buyers simply “don’t want to hear about your MVP.”
  2. Really know your exit: Are you building something that’s going to be bought by Pearson? Or go public? And please, look beyond the Series A. Your business plan can’t be built on the hopes that a Series A will solve it.
  3. Because the education market is incredibly cluttered, figure out a way to brand yourself. It’s incredibly hard though to establish a brand when you start, so think about partnering with existing big brands--even schools.
  4. I (Katzman) am not a believer in the lean startup. Startups should have the expertise and patience in house to build something that survives the trust threshold.
  5. The model of school districts has failed, and we will see the fragmentation of districts. What if you turn districts into networks like KIPP?

Video recordings of some of the panel session can be viewed here.

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