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Editor’s note: Jon Auerbach is a partner at CRV, which is an investor in Udacity and The Flatiron School.
In the off chance you’ve been sleeping under a rock with no Wi-Fi for the past 20 years, here’s some news: The U.S. educational system is under attack from multiple fronts and is on the verge of being reshaped by a profound entrepreneurial uprising.
This is acutely evident in higher education. Colleges are in an unsustainable arms race of spending on non-teaching lures – football stadiums and sushi-laden cafeterias – to attract students who can neither afford the cost of education nor find jobs to repay their debt once they’re out in the real world.
With more than $1.1 trillion of outstanding student debt, up to 40 percent of recent college grads are either unemployed or underemployed. In 2010, the unemployment rate for young workers aged 16-24 hit 19.6 percent, the highest since the Bureau of Labor Statistics began tracking unemployment in 1947. The next time you go to an amusement park, think that one in four park workers has a college degree.
As is often the case, change is coming from entrepreneurs looking to reshape education. After all, this stems from a real need on the part of startups to attract and retain great engineers. In most startups, the hardest jobs to fill are positions in core technology, product design and product management.
Educational startups used to be off-limits for entrepreneurs. The space was filled with a collection of schools and administrators resisting change and innovation. But in the past few years, two things have happened that offer real opportunity. First, the state of education is being challenged by systemic problems. And as software has become more approachable to the masses, it has led to a grassroots movement toward innovation in education.
The first forays into educational overhaul were companies like Khan Academy, which that took educational content and re-packaged it into forms that youth could relate to. The snack-size learning modules of Khan Academy mirrored videos that students were watching in their free time, and they became hits in their own right on YouTube.
A second wave of entrepreneurs then created massive open online courses, or MOOCs, with more in-depth content in the form of start-to-finish courses. Companies like Udacity, Coursera, Udemy and others give students an opportunity to take longer-length classes on their own time and often for free. And they aren’t alone. In the last several years, we’ve seen the rise of other online coding programs like Codecademy, which became popular after helping its students get into coding through its initial New Year’s Resolution challenge. In fewer than 48 hours, Codecademy was able to sign up 97,000 students.
These companies are all exploiting a huge gap in American education. In 2013, only about 31,000 students in the U.S. took the Advanced Placement Computer Science (CS) exam. This was less than 1 percent of total AP exams for the year and about the same number as those who took the Studio Art 2-D Design AP exam. By contrast, nearly half a million American students took the AP English exam. One reason for this disparity is a dearth of trained CS teachers in middle and high schools. With few trained teachers, even students interested in learning CS in high school have no formal option – last year, one student in the entire state of Mississippi took the AP CS exam.
Now a third wave of startups is sprouting up to tackle the dearth of vocational CS training with intense, in-person training. Companies like The Flatiron School, which I recently invested in, and the Turing School, are teaching students in short-term immersion programs. They tend to attract very motivated students, many of them mid-career in non-technical professions, who spend day and night learning coding over short periods of time. After completing their programs, the students have the technical skills employers are looking for, and they are highly marketable. In fact, Flatiron boasts nearly 100 percent job placement.
These schools are tapping into a large societal demand. Vocational training is the wedge to begin a 21st century institution of higher learning. And the schools are in good company. As Avi Flombaum, one of Flatiron’s founders, likes to remind people that Harvard was started in 1636 as a vocational training school to prepare a future generation of clergymen.
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