EdTech Thoughts 3/6 - 3/12
They Might Be Giants
The news of the week is the run on Silicon Valley Bank. However, bank runs are outside my circle of competence, so I’m going to stick to links to major media sources on the run and the FDIC’s attempt to contain the damage. We’ll learn what the market thinks of this solution Monday morning.
What I will say is a lot of people - founders, funders, and other ecosystem players - spent the weekend contingency planning for some pretty awful scenarios. If you work with a startup that might have been impacted and have the capacity to give them a few days to breathe, I’m sure it would mean a lot.
If you want to go down the rabbit hole on this topic, I suggest starting with Matt Levine.
On to the news.
Funding / M&A
RangeForce raises $20M: Norfolk-based RangeForce provides cybersecurity training, including interactive simulations, to frontline workers across a number of industries. This is the company’s second round of substantial funding, following a $16M round raised in mid-2020.
RedShelf raises $15M: Chicago-based RedShelf is an e-book marketplace focused specifically on supporting the university market. The company built a name for itself as the intermediary connecting publishers (over 10,000 as of this fundraise), university bookstores, and students. This round seems to be a vote of confidence in the company’s continued growth even as the two largest players in RedShelf’s market, Pearson and Cengage, invest in their own direct-to-consumer initiatives.
MentorShow raises $14M: Paris-based MentorShow is kind of like a European version of Masterclass. It trades Karim Benzema for Steph Curry and Pierre - “the man with the 16 stars” - Gagnaire for Aaron Franklin. The approach seems to be working; the website has grown to 500K+ users since the company’s inception in 2020.
Flynn raises $11M: New York-based Flynn provides private student loans for post-secondary vocational programs. The company differentiates their loans from other private loan providers by offering reduced-rate payments if a graduate’s income falls below a certain threshold, the ability to pause payments for up to 12 months, and loan forgiveness after 15 years. Techcrunch reported this round as a $36M fundraise, but $25M of that number is to provide loans to students, not equity capital to grow the company’s operations.1
Baims raises $4M: Kuwait City-based Baims provides interactive course content to high school and university students across the MENA region. The funding from this round will be spread across course development, platform development and marketing efforts.
Coding Giants raises $3.3M: Warsaw-based Coding Giants offers coding courses to children aged 7 to 19. Most of these courses are on offer in physical locations, leading the company to a franchise-based business model that is now available in 12 countries.
Kai XR raises $1.5M: Oakland-based Kai XR provides VR curriculum solutions to K12 schools in the US. The company appears to focus on more soft skills and simulations than the STEM-focused Prisms, who raised $12.5M just a few months ago.
Andela acquires Qualified and Codewars: San Francisco-based Qualified and Codewars (owned by the same parent company) provide a technical assessment platform and online community of 3.6M engineers. The Qualified and Codewars teams join Andela, which trains and places software engineers into remote roles (originally focused on Africa, now expanded to 170+ countries around the world). This move makes a lot of sense for Andela, which now has a large candidate pool to recruit from and the means by which to assess which candidates are the right fit for open positions.
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This is a podcast interview (and accompanying Substack article) with the CEO of Osso VR, Dr. Justin Barad, whom I wrote about a couple of times last year after their $66M funding round. Full disclosure, my wife hosted this podcast episode as part of a healthcare fellowship with Pear VC. But the reason I am linking to the interview is because Justin provided a mental model for evaluating VR companies that I found particularly useful.
To paraphrase, surgery (Osso’s focus) is now so complicated that surgeons, no matter how well classically trained, are struggling to stay up to date on every complex procedure they are expected to perform. Surgeons need more repetitions to keep their skill level high, but repetitions are expensive and high-risk. Osso’s simulations allow surgeons - and their team members - an inexpensive and lower stakes way to stay sharp.
The issue of increasing complexity in the workplace is not unique to surgeons. However, the Osso story gave me a vivid example of what to look for when evaluating other potential VR use cases.
There is a lot going on in this law. To wit, a $50K/year minimum salary for teachers (and $2K raises for teachers making above the minimum + up to $10K performance bonus), a dual diploma program for vocational students, higher statewide literacy standards, a ban on teaching Critical Race Theory, new school safety rules, and an education savings account (ESA) program.
It’s sort of odd to me that one of the drivers of this trend is an ambiguous provision in the semiconductor manufacturing revitalization act (CHIPs act). But, in general, I am a proponent of the carrot approach to bringing employees back to the office rather than forced mandates. It should also mean more investment for the early-childhood education ecosystem.
Edsurge did a great job in this article talking through the state of play for voice technologies in the classroom today. Voice recognition and adaptive feedback appears to be an increasingly effective way to help students learn. And is dramatically cheaper than 1:1 tutoring.
In the broader technology world, there are a lot of discussions about how many emerging economies “skipped” desktop computers and/or credit cards and went straight to mobile/mobile payments. The result was better - why bother with a desktop computer when you can bring a computer with you everywhere you go? - but the adoption curve and use cases were hard to predict when users didn’t go through the same learning cycle as developed economies.
Forgive the soapbox, but I don’t think we’re far from a world where children skip typing and screens as we know them today.2 Instead voice, or even thought, could be the primary means of interacting with computers. Crazy!
Question of the Week
Note: votes are anonymous
Results from last week’s poll: this was a fun one!
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This is a nuance that may only interest me, but I view access to capital markets for loans as distinctly different from equity capital. The company will need to grow both to succeed, but the two require fundamentally different skillsets.