Why Education Startups Do Not Succeed (2011)

Why Education Startups Do Not Succeed (2011)
avichal.com

- As it says in the post, there is a lot of generalization. And usually generalized advice for something as specific as building a startup is not good

- This is 6 years old - not sure if it still applies. A lot has changed in the tech possibilities since then

Basically consumer facing spending is about delivering cheap services, whether that be babysitting style tutoring, textbooks or slinging a minimally viable educational experience that aligns with government programs.

Targeting schools is an enterprise play. You either have the ability to survive the public school sales cycle, or the connections to get the money people behind charter schools to buy your crap.

Personally, I think this is a shitty startup market. It’s an insular industry, most non-content plays have entrenched competition or a bunch of players (Microsoft, google, apple) doing a half ass job for free/cheap. It’s easier to do enterpsie style business with normal government entities.

Targeting poor people is dumb because poor folk give zero shits about education. If you have the political juice, targeting a government agency with money to burn on helping poor people makes more sense.

I can think of at least a dozen educational services and products and it's possible/likely the optimal growth strategy would be different for each of these. For example, tutoring service (in person or remote), learning web application, learning mobile app, classic content products (print textbook, digital textbook, recorded video lessons), new-media content products (e.g. new apps or learning modality), etc. Then there is the whole "credentialing" aspect, which we all hope will go away but currently it's still a very important: people are easily impressed by big-name universities, and three-letter degree acronyms.

The "edtech space" is very interesting. The OP is totally right that it's not obvious how to make money given that neither schools nor students have money... (Sure there are rich kids and motivated parents who can pay and they will enjoy the value, but it's a very ugly thing to deny access to knowledge to someone behind a paywall/subscription just because they can't pull out a credit card and follow the funnel.)

In addition to the traditional for-profit startup model, there are big developments in the ed-tech sector by non-profits like Khan Academy. Some of the best learning UX/UI and content to come out in last decade is from KA. More generally, the open educational resources (OERs) are starting to be a thing now... there lots of good open content and there is potential for companies to be "service providers" on top of the vast sea of "commons." Open source gave us an interesting last two decades. Now imagine what will happen when open content becomes mainstream too?

On the other hand being too open with the content and starting with a "yes take it all for free" strategy is a sure way to end up out of runway. How many non-profit projects shut down because of lack of funding. Aren't there always strings attached when receiving funding from governments, NGOs, and philanthropists. What if they change their mind next year? Or two years form now? There is something beautiful and robust about a self-sustaining project like a for-profit startup. I know teacherspayteachers and other for-profit projects that are doing very well. Definitely something to learn there.

It all depends on what you want to optimize for, but the fundamental algorithm in the edtech space remains the same as in all other spaces: deliver more value than you capture and be in the right place to ride the wave up.