the new edudotcom.final

THE NEW EDUDOTCOM: BOOM, BUBBLE OR BUST?

Ellen Wagner

Western Interstate Commission for Higher Education Cooperative for Educational

Technologies (WCET)

The New EduDotCom 2013 2

Session Description• Excitement around innovations in collaboration

technologies that promote learning and engagement is inspiring educators, researchers, venture capitalists, and product managers alike.

• Commercial interests are salivating at the prospect of all the MOOCs, flipped classrooms, and online programs that will require collaboration tech – recognizing that education and training may be ready for its “Internet moment.”

• This session takes a look at the emerging market opportunities through the eyes of your customers, and offers suggestions for capitalizing on opportunities.


Why We Care

US edu. expenditures: $1.4 Trillion

Global edu. Expenditures: $4.1 Trillion

Michael Moe, April 16, 2013, ASU/GSV Education Innovation Summit


Education’s Internet Moment• Investments in education-technology companies

nationwide tripled in the last decade, shooting up to $429-million in 2011 from $146-million in 2002, according to the Na tional Venture Capital Association.

• In 2009 alone, venture capitalists pushed $150-million more into educational technology firms than they did in the previous year, even as the economy sank into recession.

http://chronicle.com/article/A-Boom-Time-for-Education/131229/






Today's investors believe this round of .edu growth is different from the last dot.com.

Michael Moe, GSV Asset Management, has noted said the first ed-tech wave had been based mostly on euphoria:

"There were just a bunch of things that were, candidly, thrown against the wall," he said of the 90s start-ups. “Some companies pitched ideas that had no sustainable business model. Others were years ahead of their time. When the dot-com bubble burst, investors fled the market.”




Wait – did someone say “Bubble”?• Government subsidized debt, also known as financial aid,

fuels much of higher ed growth.• Average family borrows $60K: $35K by parents, $25K by students

• In 2010, student loan debt surpassed credit card debt in the US.

• There are rumblings among financial organizations tracking the market segment suggesting that higher ed may be “cruising for a bruising” similar to real estate in 2008 and technology in 2000.


The “Bubble” Phenomenon• A financial bubble is defined by values that are inflated beyond

what the market will bear, or when justified against historical or projected data. The tech bubble exploded when company valuations went crazy with no

revenues to back them up. The housing market prices moved beyond what people could reasonable

afford even as banks pushed money into people’s hands.

• In higher education, many measures continue to indicate that investments in higher education pay off….for the people assuming the debt, that is.

• What about for companies providing goods and services to institutions whose stakeholders are starting to feel the pinch?


FOUR ASSUMPTIONS ABOUT THE HIGHER ED MARKET(Mrig, 2013)


Demand for Higher Education is Inelastic

(Inelasticity - The situation in which the supply and demand for a good are unaffected when the price of that good or service changes.)


New Sources of Revenue are Always Available

• Public Funds• Endowments and annual giving• Tuition• Enrollment Management• Grants and Contracts


Higher Education is always consumed the same way

Traditional

• On campus, in the classroom

• Semester/quarter based• Course credit based on

contact (1 credit hour = 15 hours in class)

Nontraditional

• Online courses (cohort)• Online courses

(personalized) • MOOCs• DIY• Competency based

learning• Mobile learning• Badge systems• Games


…(pay no attention to all that “Free” education out there...)


The Public’s Faith in Higher Ed is unwavering

http://www.technologyreview.com/featuredstory/429376/the-crisis-in-higher-education/

http://www.amazon.com/The-Quiet-Crisis-Education-Failing/dp/1882982703












MAXIMIZING YOUR PROBABILITIES FOR SUCCESS


The biggest reason this boom might not be as different as you think

“…It’s because no matter how new your tech, or how great the idea, or impressive the possibilities, we won’t crack the code on transformation until we change the most important part of the equation. And that is the human factor.”

http://elearningroadtrip.typepad.com/elearning_roadtrip/2012/03/why-this-edudotcom-isnt-as-different-as-you-may-think




It’s not about the TAM• Don’t focus on the TAM (Total Available Market). Focus on

your TSM (Total Serviceable Market) – the slice of that very large funding picture that deals specifically deals with UCC technologies

• Up to 87% of annual IT infrastructure budgets are allocated before the financial year’s end (Campus Computing Project)

• Sales cycles for large IT purchases can take up to 18-22 months for approval


Think Like an “Educatian”• Educators care about mission, not about markets. • Listen for what THEY want to do. Not all UCC opportunities

look like a course. Or a MOOC.• Find the influencers. Help them help you.• Find ways to make your customers successful post-sale. • Showcase their work. They will present all the great stuff

they are doing with your platforms at their professional meetings and conferences.

• If your customers are happy, they will be your best advocates. They will tell their friends. They will tell the press. They will tell their legislators.

• If they are unhappy they will tell their friends and colleagues even more.


Discussion, Questions, Challenges


Thanks for your interest

Ellen D. Wagner

Executive Director, WCET

Text/phone +1.415.613.2690

Email [email protected]

Twitter @edwsonoma

Web: http://wcet.wiche.edu

mailto:[email protected]

http://wcet.wiche.edu/

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