In this episode, we speak to Claire Chen of Stanford GSB and Brighteye Ventures, who just put out the brand new report, Understanding the Edtech Content Landscape.
We also discuss:
1) Video & Tiktok in Education
2) College Environment Shifts, In Part Due to Decreased Enrollment
3) Learning Loss in K12
4) Indian Edtech
In this episode, we speak to Claire Chen of Stanford GSB and Brighteye Ventures, who just put out the brand new report, Understanding the Edtech Content Landscape.
We also discuss:
1) Video & Tiktok in Education
2) College Environment Shifts, In Part Due to Decreased Enrollment
3) Learning Loss in K12
4) Indian Edtech
Welcome to Season Two of edtech insiders, where we talk to the most interesting thought leaders, founders, entrepreneurs, educators and investors driving the future of education technology. I'm your host, Alex Sarlin, an edtech veteran with over 10 years of experience at top tech companies. Hi, everyone. Welcome to This Week in ed tech. I'm Ben Cornell here with my co host Alex Sarlin. It is the week of October 19. And we're so excited to come to you with fresh headlines from the world of Ed Tech. Alex before we dive into the headlines what's going on across a tech insiders we've got a lot there is a lot going on. We've been really busy on the interview side of it tech insiders. We have episodes from the scratch foundation we're recording with Sesame Workshop, we put I just talked to senior vice president from Cosmo within the bide us universe, this all sorts of really, really interesting interviews. So please keep an eye on the interview side of the house because there's always interesting content and a lot of new things to listen to. And the newsletters exploding too. So make sure you get signed up to our newsletter. We've got a lot of great articles for you. Special shout out last week we had Matt tower guesting on our show, there's just a bunch of really exciting new reporting coming out in the ad tech space. later in our show, we're joined by Claire Chen, who published a report understanding the ad tech content landscape with bright eye ventures. So stick around for that. But starting off, we've got a bunch of headlines from the content world. headline number one is really the rise of short form content. We all know about tick tock we all know about YouTube. Now it's coming to education, new company called revise is building the TIC tock of educational videos. This is you know, short form video and 32nd to one minute long length going to high schools, we also see big changes in the digital video space. And Netflix just announced that are just launching their subscription service. As part of that coverage. They revealed that 65% of utilization of Netflix is driven by kids video consumption. Now how does that work with advertising? If your model is advertising? Are you going to advertise to kids? And they say no. So it's really an interesting moment where kids content, which often is seen as a loss leader to drive engagement on platforms is not really ideal for advertising revenue. A VOD is much better for subscription revenue, s VOD subscription video on demand. And now these platforms are flipping to advertising models. And next up Word on the street is that Disney is going to move to an advertising model in January. So this raises real questions around business models in short form video, whether that's delivered directly to consumers or delivered directly to schools, as we see these tectonic shifts with these large consumer brands. Alex, how do you think this is going to play out? Or how could this impact the education and learning space? Yeah, I mean, we talked a few weeks ago about how Roblox, which is, you know, massive, immersive world gaming platform that is sort of semi pseudo educational is very much advertising driven. We're seeing that some of the metaverse is becoming more advertising driven. And I think what you're seeing here, you know, the video landscape is enormous. And it's certainly not limited to education or kids media, but the tension that builds up between having kids media or educational video, and not wanting to make that ad supported, but then having huge numbers like, I mean, I It's hard to believe that more than half of Netflix content is kids content, there's going to be this sort of ticking time bomb before, you know, I don't think people are going to be able to resist doing ad supported kids content. I think Disney is probably just going to be the first to fall. It's interesting that you know, kids media on Netflix is not ad supported. But I think it's very unlikely that ads are going to stay permanently away from kids content. There'll be an attempt to sort of draw a bright line between kids entertainment content, which has always been ad driven. That's the you know, the Saturday morning cartoons and all the modern versions, which are often on YouTube, and educational content, which may be consumed in schools or in an educational context. But frankly, I don't think that line can really be tracked that easily and I think there's a very blurry distinction between entertainment content and education content when it comes to kid content. And given that I just think it's a matter of time before ads, and that sort of business side starts knocking on the door, it's not surprising that Disney is doing it. I thought this revised news was interesting. This is a French company started by very young founders, who basically said, they talked to lots of high school students. And they all said, we like to learn from our friends, not our teachers, we like to learn on social media platforms. So they said, Okay, we'll follow what you want. And we'll make something that is user generated content, peer to peer, and you know, and of course, the headline is going to be we're building the TIC tock of education videos, and we'll see if that actually happens. But it's a crazy time for video. And this whole advertising a bod subscription video is still a term I'm super familiar with, Can you unpack those terms for me? And maybe some of our listeners? Yeah. So for a decade SVOD subscription video on demand was the darling of the business models for content creators and providers. And subscription video on demand is great, because you get a recurring annual revenue, you have like paid consumers that you are essentially really only have to figure out how do I deliver the content that they want? This also led to content developed by the companies themselves. So Netflix was budget, billions of dollars. And what's really disrupting the space is this. You said it's a ticking bomb. I think it's a tick talking bomb. Unintended, the rise of user generated content, and the fact that people have a visceral reaction of why would I pay a subscription to this company, when it's actually user generated content that I care about and user generated content flows more freely to the new platforms. And so there isn't as much of an ability to, you know, build these tentpole content franchises and then monetize through subscription, that Tik Tok models are really primed on advertising. And that advertising creates revenue share for the user generated content. And so there are kind of two really interesting questions that came up as you you kind of unpack this. One is, is there a distinction between education content, and you know, entertainment for kids? And this edutainment gray area is just swallowing both ends of the spectrum. And number two is, are we in a world where it's still going to be content created by these organizations that you know, have high production value and are really focused on quality? Or are we going to have a spread to user generated in education and entertainment and entertainment? And all the kind of trends in the industry right now are pointing towards that UGC? Rise? And so for our ad tech listeners, it does make a really big question, which is how do you harness UGC? What are your barriers to quality? You take a company like Newsela, curriculum associates or amplifier, any of these kind of digital forward, they're all thinking about, okay, how do we wrap user generated content into our, you know, curated and or produced content. So it's going to be an interesting space. The last thing I would say is sales models that are b2b, you know, selling content to schools, universities, governments. They're just classically high customer acquisition costs businesses. And so there is also the specter of freemium models giving way to ad supported models. The kind of graveyard on that is really big and ad tech. You know, Edmodo tried to make their platform, all ad sponsored, they had something like 120 million users, and they still couldn't really make it work on an ad sponsored model. So we'll see maybe the time is right. And maybe the the kind of sensitivity to that is different. I will say, as a school board member, there's still quite a bit of resistance and reluctance, especially for younger kids. Supporting. Sure, sure. I mean, there's resistance. But yeah, I don't know. I mean, maybe it's just my cynical side, I think, you know, when you have these enormous businesses involved, it can only hold the tide back for so long. We'll get one more really quick point on this. And then I think we'll move on, which is that, you know, yes, you mentioned the amplifies in the curriculum associates in the education companies. But in the last few months, we've seen Google, especially with YouTube, Facebook, and Amazon offer creators the ability to create user generated courses on their platforms. And those are not small platforms. Those are ubiquitous everywhere, ridiculous numbers of people platforms. So you know this idea of being a educational content creator as a business or as a meaningful revenue stream. Probably supported by ads, but who knows, you know, based on this conversation, I think it's going to be more and more viable. I mean, we've seen the out schools we've seen, you know, varsity tutors, and you know, VIP kid places where people can make money teaching online. But I think this content creation for education is really a nascent space. And once these big platforms are in, you know, all bets are off. That's right. And, you know, then the question too, is, is there a curation layer here? Or is there not? And if it's a total marketplace, how do you, you know, seek and find quality? And, you know, there's a way in which like, if we have, like, Instagram level popularity drives people to content, then does the content become more gimmicky and more entertaining and less educational? Or vice versa? I just, I think we've kind of opened a third wall here, where the tech players and user generated content are kind of diving into the learning space. And you know, if we're honest about it, probably more people in human history have learned something from YouTube than any other educational institution in the history of the world. So like, you know, this goes back Milo thing of Google is the largest ad tech company, I think we're now kind of seeing that these walls come down. And speaking of walls coming down higher education walls, some of the brick and stone walls that have been here for centuries. They seem to be crumbling out. Tell us about it. Yeah. So you know, we have a higher education beat. Every week on the podcast, it's a little bit of a drumbeat of despair. And you know, what came out this week is really interesting article in Forbes based on a survey of higher ed leaders. And basically, you know, some of the findings 45% of the higher ed respondents reported that enrollments have declined in their universities and colleges. Meanwhile, they have a few different ways they're responding to these declines in enrollment, they're increasing technology spending, two thirds of them are doing that two thirds are going to offer non credit courses. So that's an attempt to expand the type of content that they offer. And I'm sure that means into high demand fields, and more than half offered a plan, or already offered non credit certificate programs, and 60% are offering stackable degrees. So personally, this is incredibly exciting news for me, you know, in my Coursera days, we were thinking about, you know, non credit courses, we're thinking about stackable degrees, and all of these things. And at the time that these were considered really weird ideas in education sort of coming out of left field, and now they're super mainstream, in response to enrollment declines. Colleges are starting to think of business partnerships, new types of curricula, noncredit technology, I feel like higher ed, the tail is wagging the dog. And higher ed is now becoming more and more like Ed Tech, and like innovative ed tech. So personally, I'm excited about it. But I also am a little fearful about how higher ed is going to respond to these scary economic circumstances. What do you think about all this? Ben, I know you sent an article from Joshua Kim, who's a fantastic higher ed observer as well. Yeah, I mean, the burning platform is clear, you know, when half of schools have declining enrollment, and you can imagine that even another 25% might have had to lower standards to keep their enrollment up. Or, you know, they might be monetizing international students in ways that they hadn't before. So there's just a lot of change afoot for schools. And these are typically immune to change institutions. But the burning platform, the Joshua Kim article gave me like a snorting laugh, as it talked about Game of Thrones and the parallels to at House of the dragon, which is the new edition of that and how it parallels the politics of higher education. And I think ultimately, we have an organizational behavior question, which institutions in the higher education space are going to be capable of changing and are nimble enough to actually capitalize on some of the opportunity opening up? And what I do see, you know, you share some of these stats around stackable degrees or non credit bearing courses and other innovations that are really consumer friendly to the learners, you're going to see some people execute that very well, but the vast majority are going to struggle to execute on that. And ultimately, what a lot of universities, you know, outside of the top, you know, 20 or 30, and probably above like technical schools, they're going to have to reestablish what their niche is like, what is their core unique value proposition? And what I think is concerning about some of these trends, is there's almost like, everybody following the same playbook, which will be in the end, very difficult for folks to differentiate So I that's in this space would be doubling down on anyone who kind of gets first or second mover advantage around a very unique value proposition in their physical geography or in an industry or in a specialization. The last thing I'd say is, it does feel a little bit like the bell tolling for liberal arts education as like a standard. And this idea that education is really primarily for the, you know, creating a great human being and great citizens, that seems to have really fallen into a distant second and third place over career skills to get a job and economic mobility. I do think that nations lose something when that's the calculation. And I think other countries where, you know, higher education is a guaranteed free thing, these are able to still hold on to some of those values, whereas like our marketplace model is going to struggle. Yeah, it's a really, really good point. And I fear for the future of liberal arts education as well, especially at this moment. But my hope, and this may be naive, but my hope is that if colleges get smarter about serving students what they are asking and paying for, then I think, actually, there is really an important role for liberal arts because one of the things that you do see read the liberal arts is that many students want to take liberal arts classes, they want to major in liberal arts, they just are sort of dissuaded from it by their families who say, Don't you dare get that English degree or that philosophy degree. So what the clever universities can and should and are beginning to do is say, Okay, we're not going to let anybody graduate from this school with only an English degree, they can finish an English degree and, you know, three industry certifications, and all of these additional things that are going to make them employable. But if they're walking away with only that degree, that is not worth that incredibly inflated tuition. And I think schools are actually getting smart. There was a fantastic article about Southern New Hampshire, which enrollments have been have really shot up, they had an amazing example of a kid whose father got a degree from Southern New Hampshire, or it might have been W GU, I will, it's one of those two amazing, you know, innovative schools. And he saw his father do it and then said, Wow, I'm not gonna go to a regular school. I'm gonna go to this take a competency based degree, he walked away in one year with a bachelor's and seven industry certifications. Amazing. And I'm like, Yeah, that's a really smart move. And the question is, if you can walk away with one year with all of that, maybe you can spend two or three more years learning theater, it suddenly becomes actually a worthwhile proposition. So I'm hoping that our higher end, you know, leaders are creative. And they aren't, as you say, just following the same playbook and not continuing to think critically about what they offer. You know, if I hope it works out, it'd be sad to admit that, like you said, this is going to be a weekly beat that we follow. And I think, you know, there's this balance of optimism and pessimism and it's just going to play out differently for across all the different schools. Meanwhile, we're also seeing that that pipeline of students coming in are woefully underprepared for college and for the basics, new report from cambium talks about the learning loss happening after COVID. You know, there's been a bunch of debate, is there really learning loss? Is there really not? Is there a teacher shortage? Is there not the last three months, it's been definitive? The data is showing that, especially around math, there is an incredible crisis point, we're seeing that math performance has dropped double digits, third graders have dropped by 16 percentage points, fourth grade to seventh grade decrease of 13 percentage points. And we're disproportionately seeing that drop in black and, and Latino students. In terms of a decrease, we saw a 22% decrease in math for African American students. What it does is it really, you know, raises the question of where is this SR funding going? And is it really going to meet those needs before the learners reach college and have to do extensive remediation. And on the K 12 Dive, there was also a report and this came to us through ASU GSB. But the $190 billion in SRF funds is basically is a drop in the bucket. They're just talking about the true extent of the learning loss. They believe that 930 billion is needed. So you know, almost five times as much as we are already funded before, and they're talking about the kind of long term implications we listeners of the show would know that there's an SR Cliff kind of coming in about a year and a half, two years where that funding goes away. This basically says we can't allow that cliff to happen. Many companies made made or broken with s or funds, but also many companies struggling to kind of close these learning gaps. It's an ed tech story, as much as it is, you know, achievement gap story, what's your read, as you hear all this? I mean, it's really scary, like, as their funding is a lot of money. I mean, I think it's a lot of money, the idea that it is so insufficient, even though it is, you know, a major investment, just, it feels hard to believe that the political winds are going to stay alive to continue dropping that many dollars into learning loss funding. So the fact that it's so needed, makes me think it's just, I still think there's gonna be an extra cliff, maybe this is just the cynic in me, I think there's still absolutely going to be an extra cliff. And I think when that happens, these reports, just talking about learning loss, and specifically talking about this cohort, who are in school or in certainly in fourth, probably fourth through eighth grade, during the pandemic will continue to just be significantly behind in English and math for their entire schooling. I mean, that's the that's the negative read on it. But I also personally think I think it's the most likely read on and I think, you know, the federal government has already been throwing so much money at this. And all the reports are saying it's not working yet. And we don't know if it will work and their their signals are not that clear that we have an answer to it. So the idea of just, you know, hey, let's quadruple, quintuple the funding on a bet that it will work. I mean, I don't think you're gonna get, you know, majorities of people voting for that. And then, so I think we need new solutions. And I know, that's like the most hand wavy thing you can say. But the high dosage tutoring is one option. And I think it is a good option, except it's very high cost. I think we have to think as an ecosystem about lower cost solutions that can scale, even in the absence of that level of SR funding. I mean, 190 billion, is a lot. And it the fact that it's so insufficient is really frightening, frankly, yeah. And so I think the burden first is on the tutoring organizations to demonstrate efficacy. Because without, you know, basically, we've run this big experiment with high dosage tutoring. And we need to see like definitive results to double down as a society. And then I think Second, it really has to be like what the presidential election shapes up like, you know, in two more years from now, we'll be defining for this issue, because the kind of two parties one party represents, like an individualism, let's let people make their own decisions. And that would kind of go away from big federal spending. And the other would say, hey, we have a obligation to help those who are furthest from opportunity to support. But even in that scenario, I think there's severe criticism and questions around the different ad tech tutoring companies that exist today and who, who's actually demonstrating results? We'll come back to this story, I think we'll round things out with one of our favorite talking points by Jews. It was announced this week to under $50 million in new funding, largely from the Middle East to quote unquote, restructure they had announced layoffs last week, we talked a little bit about this with Matt tower, also an auditor, you know, this is from an Indian called Indian Express, an auditor made an adverse opinion on internal financial controls that bite us. So basically speaks to all the trends we were talking about, around you know, when there's smoke, is there fire? The big question I have for you, Alex is, do you think bind us is going to kind of turn this around? Are they going to be able to pull the nose of the plane up and and kind of keep flying? Or is Is this just the beginning of like, deeper crash? I guess the other thing that I have in mind is like what's the lessons learned here for other entrepreneurs in our space? Like, what are this is happening on such a big stage and big level, but are there like microscopic elements of this that actually most entrepreneurs in edtech experience? So either those, how are you thinking about that? I have a very, very simple take on it, which is that I think by Jews is a great, I want to say microcosm, but I'd almost call it like a macrocosm of the tech world in general, which is that, you know, it was started by a single person. It was a really high demand field, in a humongous market. It hit it just caught fire was absolutely printing my head enormous valuation made many, many, many acquisitions and basically bet on the future being continually brighter and brighter and brighter, which it was for many years in that budget is run. And they were planning on going public part of the nonsense here, they were planning on going public at a valuation above $40 billion. They weren't basically they would, they just saw the up into the right continuing for years and years. And they said, Okay, it's good, just gonna continue, we don't have to conserve cash, we don't have to worry. And then post pandemic, I mean, starting with a pandemic, but especially post pandemic, enormous, you know, correction, maybe an overcorrection. But correction and budget is because it was so leveraged because it had hired so many people it was in so many countries felt it probably more than anybody and went, you know, they were trying to go public at a valuation north of 40 billion, they're now their new funding value is at a 22 billion, that's just over half of what they thought they weren't going to have. So your question is, what's the future by Jews? What I have to say is, I don't think it's going away, I think that five years is gonna have some kind of rebound, do I think they're going to be the sort of mega success that they thought they were going to be hard to say, maybe not as much, but I definitely don't think they're going to go, you know, nosedive completely into the ground, they're still an enormous company in an enormous market. And going global. I'd like to think that we are still going to have a second boom in ed tech, like the bright eye report from last week. And if we do, I think it'll benefit by us as much, if not more than anyone else, just like that it has just like it did for the last 10 years. So that's my take. But I think buyers will ride the wave. And hopefully the wave is going to go back up as we people, you know, get used to the post pandemic era. What do you think? I think the first like the Baidu story kind of depends on where you sit on the cap table. If you were like an early investor, or you are an early employee, you're selling the money yourself. I mean, this has been such a success from the get that it's a like, is a great success story. And I'm sure when the founder was some of the founders psychology here, too, is like, you know, I started this from nothing. And here we are, like, yeah, you know, our valuations cut to 22 billion, still 22 billion. If I'm putting in this latest 250 million, I might be at 22 billion, but I'm getting all kinds of warrants around my preference of my stock getting payback first, with some sort of guaranteed, like interest or multiple, this is more like a private equity kind of transaction. So I think that there is a danger that the end IPO valuation of by Jews, is equal to or less than the money, the actual cash money invested in the company, because they've raised or invested so much, that the later round investors unless they have super preferences, are not going to see a great return. And you know, that's to be fair, that's in keeping with anybody who's investing in ed tech space. last two years, like it's valuations are down. But I do think that the leverage and the risk, which was really predicated on the up into the right, is also creates beta for it to go down. Now, what would my advice be to an entrepreneur on the micro level? Because I do believe it's a macrocosm. I think that a couple of big takeaways are one that m&a is a 5050 bet often it doesn't work. And in education in particular, it's really hard to get m&a Right, because your customers are so different. Your markets are so different, and the complexity of serving an offering. So really being shrewd about how you line those things up, take a look at what PowerSchool has done and love them or hate them. They've really thought about who their buyer is, what's the suite of needs that that particular buyer has, and they stacked up really well. The second is like conserve cash, right? So don't, you know, save some for a rainy day and think about that one longitudinally. And then I think the third one is really around warning around consumer LTV. So customer acquisition cost is high in education in any in any way you go. There is this bias towards consumer models because your growth curve grows fast. But customer churn in b2c is really like that's a scary thing. Like one because kids aged out so they're automatically going to turn and number two is parents are fickle. And like when it comes to like kids spend they'll they'll switch quickly. Whereas I think b2b models, you've got really high LTV. So while the customer acquisition cost is really high, I'm actually a big fan of those models because of the high LTV. And you know, if you're going to do a consumer product, it's often better to be the more expensive consumer product like private school, where your customer acquisition costs can be high, but your LTV is high. Just because, you know, tuition is 15k or 20k, or 30k. Lots to take away from that. We probably should move on to our funding round and then our interview. So tell us, Alex, what's going on in the funding and m&a landscape? Yeah, I have to just add one tiny quick thing. You know, you mentioned 22 billion for Baidu uses a lot just for context. You know, the market cap of Pearson, the largest public education company, $7 billion Duolingo, three and a half power school less than three, you know, wildly Udemy, or a 2 billion Coursera. 1.7. laureate, Scholastic Kahoot are a billion. I mean, the scale that Baidu uses on compared to almost every other company we talk about on this podcast is almost like hard to overstate it it really is amazing. So in the funding world, we had a few big funding rounds, we obviously just talked about us raising 250 million, that's enormous amount. We saw Zen educate, raise $21 million. That is a company that helps K 12 schools recruit and manage their substitute teacher workforce actually know the folks Zen educate. They're amazing people. And I'm really excited to see that I just seen that now. We saw a tech and upskilling company in China's Gewinn raise 6.9 million vanta already has 2.5 million, that's a company that's all on the intersection of gaming and schooling. It's based in Boston, we saw the equity firm, general Atlantic by 15% of the shares of Kahoot. That was the set of shares that was owned previously by SoftBank Group. That's a little bit of a shift. And we see a company called Aruba just announced their pre seed funding. That's all about accessible education. So, you know, a couple of giant rounds there and a few smaller ones, but still some movement. How about m&a? Ben? Yeah. And before we go on to the m&a go back to the buy juice front, they've raised 5.7 billion in cash. So they raised more cash than the market cap of basically any other edtech company, or education company. So the question is really like, will they come back down? I also would just comment that the general Atlantic by I think that's really interesting, especially given that we saw Lego acquiring BrainPOP general Atlantic is a mover and shaker in ad tech. Now, their partner, Josh Feldman solely focused on on Ed Tech, and I think that they're going to be a pretty big player in potential rollout moves. So with that, speaking of other m&a and roll ups, Follett higher education acquires Willow labs, the Terra education acquires Go board and tutor matching services to provide tutoring solutions for K 12 and higher education you science acquired the National Center for college and career transitions. VISTA equity partners also made the acquisition in the cybersecurity space and the Dan to acquire Deeksha for $40 million. This is another Vidin to huge Indian ad tech company that is kind of competing to be the leader with buy juice. And then finally physics. Wala acquired prep online and Altis, fortex. You know, what do you make of all of this m&a, it's really the beginning of that rollout time. We're just seeing activity spiking. And we're finding out who are the acquirers and who are going to be the acquirer the Follet move, because that means that they're in offense on also the cybersecurity firm is no before they acquired it for 4.6 billion. This is one of the largest private equity players in the space. They're going in hard on workforce learning, with Vedanta to playing, you know, you see by Jews restructuring and cutting and struggling, this is signaling from Vedanta, Vedanta, that they're going to continue to grow aggressively. They raised 100 million in September. So pretty interesting changes in the landscape. Yeah, I would just the second India moves. I mean, I think, you know, by Jesus every week, it has a headline that either sounds like it's growing enormously or falling apart or, you know, it's just incredibly volatile right now. And I think some of the other ad tech unicorns in India that's, you know, the Vedanta is the upgrades the physics wall As are probably smelling a little bit of blood and starting to think, okay, you know, we don't know what's gonna happen with by Jews, and they're asking the same question we're asking every, every week, where is my juice gonna bounce back and eat the whole market and acquire everyone else like they've been doing? Or are they going to, you know, just continue to struggle with all the things that they're struggling with. But these other, you know, pretty big size and tech companies in India that have been taking, you know, a second fiddle seat to bind us for the last five years, are starting to do those roll up moves and put their cast to us. So it's gonna be really interesting to watch that I would just say, you know, Alex, we need to do a podcast episode from Bangalore. So any listeners out there if you want to pay for Alex and I to fly over to India, and eat, breathe and sleep the landscape for a bit and, and report back? You know, just send us your information. But yeah, I think that we are in full shakeup mode with m&a Cream roll up in the NASDAQ market changing catalytically and the Brian II report really talking about content and platforms, especially in the European context. And so with that, we'll transition to our interview. Hi, everyone, we're so excited to have our guest this week, Claire Chen, whose article understanding the EdTech content landscape just came out from bright eyed ventures. Claire is an MBA student at Stanford, it's so exciting to have her join us here. Welcome, Claire. Thank you both for having me. So before we dive into the report, it just be great to hear a little bit about your journey and how you got connected and engaged in that tech, for sure. So I'll start briefly at the beginning, which is that when I was three years old, my family emigrated from China to Canada didn't have a lot in our pockets. And my parents very much sacrifice financial stability, to make sure that they could send us to really good schools and rent apartments in those districts. And so that changed my life. And I very much grew up with an appreciation of what education can do. And I think as I grew older, a frustration that my parents had to make a trade off in the first place and an awareness of how many parents cannot, for whatever reason, do that. And so in undergrad, I wrote my senior thesis and education. When I graduated and started work at BCG in New York, I primarily worked in our education team. And so now I am a second year MBA student at Stanford doing a dual degree master's in education, MBA, and thought, you know, one thing that is so important in this space is scale. So how can I try and find a role that lets me explore this. And that led me to the incredible team at Red Eye ventures, which is a VC fund in a tech based out of Europe. And they're an incredible team, they were kind enough to have me for the summer. And that's how I got to working on this report. It's really a great story. And I think it's so exciting to see people having their personal experiences with education and access and the cost of education lead to them actually making a difference coming into the field, and being the next generation of ad tech innovators. So we're excited to see what you go on to do in this field. So let's jump into the report because it is really interesting. I highly recommend all our listeners, you know, look into it. There's a lot to digest. The first question I have is basically you did this market map of edtech content, you look at it through a lot of different lenses. Can you tell us about the framework that you use to sort of look at personalized versus set curriculum? Yeah. So I think this is a really hot topic in ad tech, which is, how do we think about personalization? And in what forms does it really manifest? And initially, on these market maps, there's such a temptation to do just a spectrum and subjectively start plotting things? And is this more personalized? Is that more personalized? And me and the bride it really wanted to resist that because it's really hard when you're on the margins, making those calls. And it's, I think, much more of a thoughtful exercise to understand the patterns that are coming up in personalization. And so we identified four categories, starting at the least personalized his set curriculum. So this is the idea that the offering is one set curriculum, it doesn't matter who you are, if you're in it, you're receiving the exact same materials. And this is still relevant. This is actually still happening today. Although I think it's a little bit rare when you think of the new and exciting companies, but it's still happening and it still works. Then there's this idea of self selected modular. And so the definition here is that you control your learning As the recipient, because there are multiple modules out there, there are teaching components of what you want to know, but you can choose it. So it's a little bit of a choose your own adventure at this point. But the onus is still on the user of that technology to figure out what they want to learn. Then we move into personalized direction. So here, we're really starting to bring in that AI ml, some more advanced technology that is nudging the user. And in this case, the learner is not fully being directed, but they're being pushed in certain directions based on their previous context, their goals and their behaviors. And then finally, we have the elusive, fully adapted, personalized, which is quite hard to do in this space. And the idea is that everything is fully personalized, no two users are having the exact same experience. And this could be because you're actually talking to another human. So it's not really, you know, AI at the end of the day, or it could be AI, but we wanted to really lay out that full range of what's going on in personalization. So when you lay it out that way, it does feel like there's a progression that eventually everything will move all the way down to the full personalization. But you also talk a little bit about some of the value of modular or other modes. How do you see the future playing out with all of these? Is this moving all in one direction? Are we actually going to have like a patchwork quilt of different types of content and curriculum? I'm particularly interested because I think investors are often trying to think about where things are going in five to 10 years. But also entrepreneurs are thinking, okay, is this a competitive landscape map? And how do I navigate this? Totally, I think it's a great question. And I wish I had a crystal ball to fully gaze into the next five to 10 years. But I think there are a few things I would call out and that the first is that there remains value across this entire personal age of personalization. One example of a company that is moving in this set curriculum space is the power Business School, which is based out of Spain. And they have a really exciting model where their students are like me, who is going into debt to go to business school at Stanford, pay significantly less to receive a really high quality business education, with 15 minute classes at affordable price points, taught by exciting founders and business leaders. And because it's a set curriculum, even though there's not a formal accreditation, companies can recognize and understand what they're getting when someone is a graduate of that program. So I think when you're talking about specific career pieces, whether it is business school, or sales, or you know, engineering, the remains value in that very traditional form. On the flip side, I think, right now, my understanding of the landscape today is that AI is not quite there to have fully personalized experiences, maybe we'll be there and 10 years, five years. But there's a lot of really cool platforms, right, which are effectively having a fully personalized experience, because you're just interacting with another human being. And one company that's doing that as tandem, which is doing peer to peer language exchange. And that's really exciting, because just meeting someone who also wants to learn or practice that language, and there's so much value in that versus just getting grammar fed to you in the classroom. And so I guess this isn't it depends, which I know, can be unsatisfactory, but there's definitely really cool stuff happening. It's just a little bit more dependent on if it's formal learning and formal learning and, and what the purpose of that is, yeah, that totally resonates. And, you know, I often tell people like in advertising, if your AI is right, 40% of the time, that's amazing. In education, that's a product killer. I mean, even if you're like 95%. So there is a way in which the technology breakthrough is really providing connectivity and access rather than insights at this phase. You know, one thing that was really nice is that you didn't just stick with the axes, you also talked about that middle with, you know, I think the trend that Alex and I have seen the most is really modularization of all degrees of all learning with the idea that every learner can take the Lego bricks and stack them. And you either have a like empowered learner who really understands how they want to stack the bricks. Where do you have an advisor to the learner who helps them co construct like a learning path? Alex, what's your next question? Just to give some of our listeners sort of a context of some of the companies. Claire did a deep dive on the market map and his naming some really interesting new companies that I hadn't heard of, but some of the companies that are that we talk about a lot find very specific parts of this market map. So in that modular sort of stackable section, you have companies that are basically course catalogs like you know masterclass, Is domestica Skillshare Coursera. And then, you know, things like steady stream and Nearpod, which are multisided. But they're still self selected. Set curriculum involves things like multiverse, or guild or, you know, power business school, you know, what I have to ask is the other axis you're going on. And that this is a very specific choice is that AR VR access. So you have this sort of unilateral and multisided platforms, and then content being made in augmented and virtual reality. I'm curious how that focus came about for this report. And what you found looking at the whole landscape of virtual reality content, I think it's actually really hard to talk about technology broadly, these days without at least, you know, nodding to VR AR because it is so exciting. And with Meadows investment in the space, it's very top of mind broadly. That being said, there's a lot of buzz about VR, AR and education. And I think we went in trying to really prove or disprove where they lean in and out whether that's today or just in the near term. And so that access you're talking about Alex does start with some more traditional content and platforms and quickly moves into VR, AR hybrid, and vive AR. And VR AR hybrid is the idea that you have content that can be used on a VR headset, but can also be used on a traditional 2d screen, you're just seeing a 3d simulation from your tablet or your laptop. In terms of things we learned, I think I would highlight, first of all, that there are really, really specific criteria that make VR makes sense today. And maybe that will change as costs change in the future. But it's not the kind of thing where you know, for whatever learning you jump in, and it makes a ton of sense. And so some criteria I think I would share with you would be first, this particular kind of learning is an indispensable core function to the learner, they have to know this, it is, you know, the bread and butter of what they're doing, they can't screw it up. So they're willing to pay that money, whether it's them or the company or school they're at for training and that function, I think the second is that this kind of thing is actually really costly or resource intensive, or actually really dangerous in the real world. So you there's huge safety and having this ability to do it virtually. And then finally, maybe training conditions to find this in the real world are just really hard to find. And so fundamental VR is one of the companies that we identify in this space, and they basically do VR haptic surgery simulations. And haptic means that there's a touch element involved. And as you can imagine, this is indispensable to surgeons, they need to learn how to do surgery. But also, it's really dangerous if I'm going into surgery, and I know this relatively inexperienced person is operating on me. And so it makes a ton of sense to try and bring this into the VR world from a learning perspective. And also what the company has done well is actually offer accreditation for it. So it's officially recognized. But I think that's this one key piece, which is yes, there are very specific contexts where it makes sense and actually first mover's usually in most of those contexts. So we'll see if other players join and how that market shakes out. But there's already movement on some of these friends. Just even hearing you describe that makes me feel like one there's the innovation on the technology. But two, there's the old bread and butter of get your course credentialed and like still some of the same laws and rules of successful ad tech businesses apply, you know, at dreamscape learn, they also have haptics, you know, for kids do like a dissection of an alien animal. And there's a way in which this like, VR experience in like 30 minutes then is paired with offline experiences. And I see a lot of companies and organizations going there. All right, so to wrap us up on this, of course, all of our listeners have to read the report. Can you settle the debate? On one side? Content is king, on the other side platforms are longterm, the winners platform versus content? Where do you land on this? And how do you see it playing out? I am so sorry to disappoint. I think I will not be the one to provide a conclusive answer today. And I will return to the beloved phrase of all consultants, which is it depends. And the reason for that is I think there are really smart content plays you can continue to make. And we are seeing from the report that traditional boot camps which were for software engineers, typically are now expanding into spaces like sales or, you know, some other very mechanical tasks that might be related to energy and there's power there still and having really thoughtful content and training people through that content and even in big companies that potentially could emerge from what appears at the first brush to be a more narrow focus, but is disrupting an industry which really hasn't seen that yet from a learning perspective, then on the flip side, it's so hard to resist this idea that you're being connected to people on demand. And there's like a common purpose and motivating goal, whether that is steady stream and all just being in a study room together and not doing much more than that, or out school, right, where you're actually receiving lessons. And there's, there's power, I guess, in both of those things. And I think it really depends what you're trying to accomplish, what industry you're trying to move in. And so I guess, I wouldn't necessarily discourage anyone from taking part of this map and say, Oh, it's over. There's nothing more to be found here. But I think I would encourage really thoughtful comparison of what is in the niche already that you're working in and, and what spaces is left for you there. Well, that's a great way to wrap this up. This is Claire chin, her article or report understanding the EdTech context landscape is available on friday.com. And you can web search, she is a Mamba at Stanford. We are so excited to have you in the Ed Tech and education ecosystem. Thanks for coming on the podcast. Thanks for having me. And if you'd like research like this Friday does have a newsletter that has more so I can't end without giving that a plug at least. But thank you so much for having me. So that's it for us at ed tech insiders week in ed tech. We have October 19. We've talked Bhaiji. As we've talked learning loss and the Esri cliff, we've talked about how some dragons and W GU giving students you know, seven industry certificates and a degree in one year. And of course, the video on demand debate that is going to shape the future of whether our kids are sitting in front of ads in school. Thank you to Claire Chen, who is the amazing MBA candidate who has been working with bright eye on this fantastic ad tech content report. We will put the link to that in the show notes. As always, thank you to you, Ben Cornell for always knowing what's happening in edtech. And thank you to our listeners if it's gonna happen in ed tech and it's happening in ed tech. You'll hear about it here on Ed Tech insiders. Thanks for listening to this episode of Ed Tech insiders. If you liked the podcast, remember to rate it and share it with others in the tech community. For those who want even more Ed Tech Insider subscribe to the free ed tech insiders newsletter on substack.