But will it make money? (Week 3, Ed Startup)

I took a quick look at the startup ideas on Ed Startup this week, and found that many of them are in truth more like non-profit projects or programs than businesses. Maybe it’s the nature of those that are in a service-oriented sector to begin with— I think most people that have an interest in education have a stronger instinct to serve ideals than to make money. God knows I also have a penchant for tons of non-profit ideas that do not lend themselves to sensible business models.

I am incredibly thankful for the role that non-profits have played in this world, they serve much neglected niches and give our societies incredible, dynamic energy. I want to be clear, also, that I believe that a non-profit is just as much a startup as a for-profit business. Regardless of where funds come from, I think it is imperative that we ask ourselves the difficult questions of sustainability when we set out to do something. It benefits both ourselves and the society (should our idea turn out to truly serve a need) that we execute our vision with sufficient understanding of the resources required. It gives the much needed rigor to our “startup idea” to push it one step closer to reality. It is also for the benefit of the education sector that entrepreneurs who truly care about education can thrive and sustain their operations.

I have also struggled with the business economics of my idea. What I have come up with may be a bit ambitious, but here it goes!

The idea

Create a membership-based co-working space/community that brings together K-12 educators and edtech startups. The community will be reputation-based, that is, membership will be vetted and restricted only to educators and companies who are of quality. Edtech companies will have to apply for a fee, while educators will be invited for free. The community will coordinate product feedback sessions, hackathons, networking, and other events to facilitate communication between the two communities.

The problem

There is a gap between the tech community and the educators community. There are too many products floating around that cannot find suitable markets, and teachers do not have the time to juggle all the new technologies. Many edtech companies build products that are not truly suitable for educators or fail to gain sufficient traction for their product. This is either because they have not conducted proper user studies with their target segment, or because of their limited network reach. For educators, there are simply too many products available to understand which ones are worth their time and money— and often they do not have enough time to give new products a good try, let alone have time to participate in user research beforehand.

The fix

Bring together the two, in real-time!

Teachers will be invited based on their reputation/teaching track-record (though they can also actively apply) and can be members for free. The incentive for them is that it will come with free tech-training workshops, possible stipends to supplement their classroom settings, other possible freebies/fellowship, and the opportunity to network with other extremely capable educators/techies. Not to mention, of course, they will have a much better idea of what’s good tech to use for their classroom since they will be exposed only to the best ideas. In order to join they must also commit firmly to a certain amount of time giving feedback/interacting with tech startups.

Edtech startups will have to apply and be vetted based on their quality. There will be an annual fee involved, and it should be something in the range of what it’d take for them to hire one additional community manager who will have to start their outreach from scratch. The incentive for startups is to have ready access to educators— both as a product research user-base and potential market after launch, and to have a community that helps them organize these product panels/networking with educators.

The community will be funded by edtech co’s membership fees, events fees, and possible other tech corporate sponsorships. Even though it seems a bit ludicrous to ask tech co’s to pay a fee, this is mitigated by the fact that it will reduce their other labor/research costs in community management. If there is sufficient interest/space, the idea could even be extended into a full-time coworking space for some edtech startups— many of them have to pay rent at other coworking space anyway! The primary costs of this startup will be rent/utilities and some administrative personnel.

Why

There is not simply enough interaction, understanding, and collaboration between the two communities right now. Most efforts are sporadic rather than systemic. Educational technology is unique in that most end-users do not have the spare time or money to explore new technologies unless it really hits the nail on the head; hopefully this will help produce technologies that are really needed in the classrooms, and thereby help products find sustainable markets.

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7 comments

  1. I like the idea of the two sides of the puzzle coming together. Will you be working with entire districts or individual teachers? As a teacher I know that it is hard to get district approval for some of the stuff that I want to incorporate in the classroom.

    I also like the idea that it is free for teachers, but some of my colleagues hate professional development as it is and would never think twice about going to professional development on their own time (sad).

    I would love to do this as a teacher, to find new materials and tools I can take back to the classroom to better engage my students. Good idea!

  2. It seems as though there are two phases of service you are proposing. One is in the early phase, while the start-up is iterating through ideas and “pivoting” around – the service being to provide credible feedback regarding whether the innovation is well thought-out from the perspective of implementation in the classroom. A second is iterative feedback from educators beta-testing the product.

    In the first phase, the start-up is probably small, quite possibly funded with ownership rather than cash, and may require a business model that allows them to participate in your offerings before they achieve funding. In the second phase, there may be money available and most likely your service will require an existing educator base large enough to help a start-up begin the boot-strapping process of reaching the market.

    In either case, if I understand your business model, you will be attracting top-notch educators with free professional development opportunities of various kinds and possibly stipends for their classrooms.

    The key to your business model, it seems, is to create a community of educators that is sufficiently large for bootstrapping and sufficiently valuable for top-notch feedback. It might be valuable to add other stake-holders into the mix as well – one of the fallacies that occurs when start-ups look for feedback is that of asking users what they want and inevitably ending up with incremental innovation rather than breakthrough innovation (which can be ok, but tends to be vulnerable to commoditization or disruption). The trick is going to be to entice sufficiently savvy educators into the community. This is also a boot-strapping problem of a kind – if you can create a core of educators who are respected and followed by other educators, that will attract more of the same. If they can achieve together a larger impact on the technologies that help them teach in the best ways they know how, than any of them could separately, that community can become self-sustaining, I think.

    That said, having such a community (probably a combination of educators, researchers, and thought leaders) could be a significant differentiator as compared to existing educator networks that tech companies might access without cost. In time it could become sufficiently valuable to be a realistic alternative for start-ups to doing their own outreach.

    Perhaps one additional service, down the road, would be to provide start-ups that do not, initially, qualify as “quality” to improve.

  3. I love your idea and your passion. that said, as a founder of an edtech startup I’d say your best bet would be to get the entire program funded by grants because edtech isn’t free to produce either. The cost of producing can actually be quite high so an additional fee to interact with educators isn’t a great incentive. Also consider what it would cost a school or teacher to have a product developed privately. This is one of the biggest historical barrier to getting through the doors at public institutions. In getting funding from the outside and having both teachers and edtech companies apply you’d also be vetting passion which is a great glue for these two world that are so different.

    • hi Julian,

      thanks for your thoughtful comment. I completely agree with the points you raised and have felt that this revenue stream was slightly ambitious as well

      1. most startups are cash-strapped. the ones that are not would not have as great a need for this since they would already have their own marketing and r&d departments
      2. it is somewhat unfair to place the cost burden on the edtech side, since they would be the ones that execute any innovation 

      still, I think we cannot rely solely on grants and need to have sources of sustainable revenue. I’m quite wary of the non-profit model and the friction involved in scaling. this is not to say that the idea has to be entirely for-profit, I see that that nonprofit funding could be helpful in the initial launch or to supplement opex, but it is difficult philosophically as well to have a completely nonprofit model when you are involving companies that ultimately need to make a profit.

      to that end, here are a few ideas that might make this model more workable. I want to be the first to admit that they are still speculative and need further market research to validate or disprove.

      1. The community needs to come with enough value add for it to be ‘worth it,” that could be access to VC investors network, university research labs, or something else beyond teachers. priority could be given to funded startups. for bootstrapped startups, maybe there can be an alternative program that is more like a fee for co-working space (which many early startups are paying for anyway).

      2. instead of cash fees, maybe the program can take an equity stake or have revenue sharing mechanism instead. something akin to y-combinator. again, the community needs to prove sufficient value for people to be willing to do that. 

      3. target the program to cash-flush private schools that may be interested in developing better learning environments, with schools providing part of the funding. the program would take on a different tone then, and would be almost be more like a research lab for ‘state of the art’ technology-integrated learning.

      these are preliminary ideas to be sure. WordPress blog is prob not the place to have a fully fleshed business plan, but these may be some avenues to explore.

  4. Interesting idea. A kind of EduHackerSpace. I wonder about two things though.

    Vetting is hard. It is hard, time-consuming work, and hard to get right.
    Free to teachers sounds good, but enforcing required feedback to the commercial partners is hard too.

    A nominal fee to teacher-participants would keep the signal to noise ratio high. A small, one-time charge to become a member might keep the deadwood out.

    I work with an NPO that historically got most of it’s funding from commercial partners–many of them textbook publishers–through membership fees and advertising to teachers. That revenue has really dried up over the years as the publishing industry consolidated, advertising budgets declined, and other ways of reaching teachers got easier. Over-reliance on commercial partners can be perilous as their fortunes ebb and flow. If the community has value teachers should be willing to pay something for it. And, conversely only including people willing to pay means they have an incentive to make it work.

    • Good point. I find it interesting that both you and Julian think that making teachers pay is a good idea. Maybe it indeed is a good vetting mechanism. I wonder what the market demand for that would look like in reality but it’s an interesting option.


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