Moderator: Saad Khan, Partner CMEA Ventures
Panelists: Jose Ferreira, CEO Knewton; Jeff Shelstad, CEO Flat World Knowledge (new type of publisher that uses open source concepts for textbooks); Brian Jones, Senior Counsel, Dow Lohnes LLC (former general counsel of US Dept of Education.)
Saad. Presumption is that education needs to be reformed. What are the problems?
Jose. Internet and computing has revolutionized other industries, it is inevitable that it will revolutionize education also. It will solve the distribution problem. Makes distribution of content almost free. The best professor at HBS could only reach so many people. Koby Bryant is paid so much because he can entertain so many.
Brian. There is a political dimension to the K12 system that you don’t always see in post-secondary. Enormous sums of money coming into education from the stimulus bill, to improve student outcomes and teacher effectiveness. There’s a real fertile ground there. That is exciting. Particularly the amount of money the Federal government is investing.
Jeff. Coming out of the print side, the internet has already had a distruptive impact on textbook industry. Students can find alternatives to textbooks. We think textbooks needs to be redefined, built differently. He (Knewton) is taking one tact; we’re taking another. Perhaps we’ll merge eventually.
Jose. At local CVS there are 30 types of toothpaste. Yet, we standardize education for everyone. What we do at Knewton is we personalize it. We serve it to students based on what they need–sentences, paragraphs, pictures, videos, games. Depending on how you learn. And how you retain. Hyper personalized learning will power this flood of content on the internet which I think is coming.
Jeff. Flat World — we are trying to transfer the power of what takes place in the classroom to the teacher, so make the book match your course, rather than vice versa. To the student, we’ll deliver the content in any format they want at a fair price.
Saad. SRI report looked at effectiveness of online education vs. in classroom personal teaching. Online was more effective. Are you seeing that?
Brian. The post-secondary sector has shown us because of diversity of providers, is emphasis on different types of students and different modes of learning. The rise of the for-profit school sector is that it is serving non-traditional students. The for-profit sector has led the way in online delivery of content. We have students that work during the day, so classroom mode doesn’t work for them. K12 is a late comer to that, but we are seeing an emphasis on outcomes and a new openness to these alternatives. We have a competely online charter school in DC. It was controversial. Some people said, aren’t they really home schooled, and aren’t we giving taxpayer money to home schoolers? But what is coming out is that this mode of education is working for these kids. For whatever reason. Engaged parents. Maybe parents have religious reasons for not wanting their kids to participate in traditional schools. But the outcomes are positive. The more we focus on the true deliverable and the outcome of the technology, you’ll see door swing open and resources will follow.
Jeff. I got an online degree from Duke. They were an early pioneer in part off-campus part on-campus. In an online environment, the important of the instructor is actually raised. I had some poor expeiences in the 16 courses I took at Duke, some great experiences. Depended on the instructor. I think students like the flexibility of online, but I”m not sure I believe the report. I still the faculty member is vital in this process.
Jose. A couple interesting things about the report. Most online eduation has been astonishingly bad. U of Phoenix is big in online. My former employer Kaplan is in this too. Online is the future of this company. (And of the Wash Post). Their model is assisted self study online education. Attend a chat room with a mediocre teacher once a week. In 10-15 years that won’t be the model. It will be, you want to learn German? In 8th grade. You’ll go online and get one of the best teachers in the country, a dynamic teacher from Exeter. There will be thousands of courses.
Saad. Megastudy out of Korea, is a public company. They got the best Korean teachers, syndicated their content, delivered it oline, shared revenue with teachers. Hundreds of millions in EBITDA. They turned some teachers into millionaires. Gave them the Kobe Bryant audience you mentioned.
Jose. In 2000 there were 45,000 online German students in the country, now there are something like 2 million. If a parent wants the child to learn Chinese and the school doesn’t offer it, it won’t matter. Any course will be available. That movement will transform education in this country. Any elective.
[I just followed Knewton and Flat Work Knowledge on Twitter.]
Brian. Higher education in this country is very high-brow; they don’t like outsiders, particularly those seeking a profit, coming in to do things differently. There are 4,000 charter schools in the country. That is where you are finding openness to this kind of technology. We are the first charter school authorizer in the country–we hired the Boston Consulting Group. We built a technology infrastructure. We have 99 charter schools in the city. Hospitality high school. Residential school serving low income kids. Our infrastructure lets us compare schools so consumers can see what school would work best for them–plus mission specific criteria, so the hospitality high school gets measured on unique criteria as well. I’m surprised we were the first to build this kind of technology to assess outcomes.
Saad. Assessment is a good thing to look at. There used to be zero transparency in advertising. Feels like there should be a big opportunity to get transparency in student performance, across schools, etc. Are you seeing a lot of assessment technology?
Jeff. Yes, in higher ed, it’s a significant movement. To deliver assignments through a platform, and feed a professors gradebook, is a service the industry moving towards. It’s happening. Some great platforms out there. A big movement for all institutions, faculty and students.
Jose. You can’t built personalization without assessment, very granular, very discreet (self-contained), and no hiding results. I joked with my investors–if our adaptive learning platform works we’ll have data to show it. If it fails, we should go out of business. A typical Kaplan course will raise GMAT by 35 points. We have a 50 points guarantee. We give virtually no money back. We are measuring 100 points on average. We take text book content, like we took text prep. So the reporting shows how good the class was doing on each concept. The teacher might get an email showing that the students as a whole are struggling with certain concepts.
Brian. In the $4.5 billion that DOE is distributing to states in the race to the top, the state has to be able to assess a teacher in part based on their students’ achievement. The kind of technology Jose is talking about is essential in moving things along. Some states make it difficult to evaluate teachers. At the K-12 level there are infrastructure things that need to be addressed. School districts and states are going to have to change or get left behind. We have to realize, though, there is some resistance there.
Saad. What is the most helpful thing the government could do to help you be successful as you push boundaries of education technology?
Jeff. Eliminate tender? (laughed) If you take UMass online, a competitor to U of Phoenix, it has been successful. University of Illinois launched and failed. Why was UMass successful, but Illinois wasn’t? That’s a classic case study. There are incentives and infrastructure issues.
Jose. Govt should put more computers in schools. I never even thought about getting government money, so I raised venture capital. If nation’s best and brightest had been going into education and not finance during the last 10-15 years, we probably would have solved the problems already. There has to be incentive for top minds to go into this field.
Audience question: can a young person today apply themselves without a formal education and get the skills you need to succeed? (Like Bill Gates did?)
Brian. Most of the research is pretty clear that on average, the more education you have, the better off you will be in the marketplace. You cite Bill Gates as an example. You also have Michael Jordan and Tiger Woods–but you don’t necessarily want to use those examples and have kids think they can succeed without education, even though a few do.
Jeff. Big publishers are very scared of the electronic world. They will move very slow in terms of transparency. They want to control everything.
Jose. I talk to the big publishers all the time. Some are changing. Oxford (sic) is thinking of this.
Jeff. Five companies control 85% of the market.
Audience–I have no doubt adaptive learning will create better test scores, but what you learned at Harvard, you didn’t just learn from a professor or a textbook. You learned it from 80 other people in your core. How will that change by technology?
Jose. I believe schools in the future will have fewer teachers, 5,000 electives, but still a blended model. You’ll still have kids in schools, being socialized, learning from other kids. Lets say 5 years down the road we have OUP’s content. Maybe we’ll have 10 million kids that do geography that learned geography. The 10 million and 1th kid comes; our system will query, which kids previously had this problem, and also, what learning style did that kid have? We’ll find out what they did next, and which way they learned it. So then we can produce that same learning experience — anonymously — and use it to power the learn of one kid, on one night, on one concept.
Audience. I’m not questioning the value of the system. But the concept of a PhD is to have a thought that no one really had before. [She seemed to care more about the personal interaction of students than the panelists.]
Brian. We have a program that has 85% of their program online, but one day a week they come to brick & mortar. They can also engage in extra curricular activities.
Audience comment: I’m looking for people that can learn how to provide solutions in very complex situations. I find that very bright young people cannot communicate. They have a ton of information. But they can’t connect the knowledge to reality. The problem with the US educational system, you do not teach students how to learn. I see technology being helpful to create learning paths for individuals, and accomodate applying knowledge. I think you are missing providing them with process that can be tailored to individuals and groups.
Audience question. Every new technology comes with evangelists (I’m one) promising that it will change everything. Why now? Why is this different?
Brian. Now, because there has been a culture shift in education that is undeniable. There is a focus on outcomes. That is different. It began in the 1990s. We built on it since 2001. I’m talking K-12 here. It was led by policy makers, but the technology has enabled it. Since the 60s billions have been spend on education, but test scores are lower. It’s bi-partisan now. Some hold on to the status quo. Look at how teachers unions have responded to Pres. Obama’s plans to assess teachers–they whined at first but are coming around.
Saad. I’ll add that technology lets you go direct to the student. There is the class, where the channel is the school. But social networks and the web let you go directly to the student.
Jeff. I think it’s a great question. The textbook wasn’t supposed to exist in 2001 when I was in the industry in 1996. The difference, jumping on Saad’s point, but I think it’s going to be slow still, but the consumer is more powerful today than it was when I was at Prentice Hall, but it will be slower than we all think.
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