Monday, August 31, 2009

Resource for Indian Education Market

You want a little more information on the Indian education industry, you say?

You should really talk to Rahul Choudaha, who wrote this dissertation (click on the link) about finding a core competency curriculum in international education.

Rahul will be joining us on this blog, where he will be writing from time to time about the intersections and differences in the India-United States for-profit education industry relationship.

Rahul also writes the Dr. Education: Diagnosing Indian Education blog.

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Teaching Young Girls, Spiting the Taliban

An article on what it means to teach young children in the Forever War, the name given to the war in Afghanistan, popularized by reporter Dexter Filkins.

An excerpt from the article, where the protagonist is stopped by an extremist and sprayed with battery acid for, among other things, having the audacity to go to school a few miles away from the hometown of Mullah Muhammed Omar, the leader of the Taliban:

Shamsia Husseini and her sister, Atifa, were walking along the highway when they spotted the men on the motorbikes. Shamsia, then 17, was old enough to be married; she was wearing a black scarf that covered most of her face. Shamsia had seen Taliban gunmen before and figured the men on the motorcycles would pass. Then one of the bikes pulled alongside her, and the man on back jumped off. Through the mask, he asked Shamsia what seemed like a strange question.

“Are you going to school?”

The masked man pulled the scarf away from Shamsia’s face and, with his other hand, pumped the trigger on his spray gun. Shamsia felt as if her face and eyes were on fire. As she screamed, the masked man reached for Atifa, who was already running. He pulled at her and tore her scarf away and pumped the spray into her back. The men sped off toward another group of girls. Shamsia lay in the street holding her burning face.

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How to Become a Tutor In Hong Kong

The new scandal de jeur in Hong Kong is the rise of very wealthy tutors for public school students in the island territory just off the coast of China.

Hong Kong private tutor centers are cashing in on changes the public school system curriculum, but long before that, famous and sometimes notorious private tutors have been earning millions teaching students how to be successful at what is, very broadly speaking, a by rote and memorization school system in Hong Kong.

This is a touchy subject in Hong Kong. When vacationing students offer to help other students with summer school homework for money, people tend to get skittish and all sorts of moral volleys are lobbed each way and that.

But private forms of education, like many forms of business in Hong Kong, offer topographies for success in a purely capitalist system.

I was a private tutor once, and let me just demonstrate how easy it was to start up my own mini business while I went to grad school in the territory.

It took a few things:

1. Connections -- First and foremost, this is really how many people get anywhere in China and Hong Kong. I knew the wife of a pretty well-known Goldman Sachs director, who, after discussing with me my career options for funding my journalism degree at the local university, put in a polite word or two to six well-connected and wealthy business people near the Southern district of the island, where I lived at the time.

2. Credentials -- In addition to pursuing a second masters' degree, I had one master's degree in creative writing and a B.A in English literature from American universities. I also used to be a teacher. I spoke well, with a Midwestern accent. These really were all the credentials anyone needed. Just show off the degree.

3. Work Cheaply -- I started rates at only HK$400 an hour. That's about US$60 an hour. That is actually relatively cheap for a private English tutor in Hong Kong, someone who visits the home for one hour to one and a half hours a week.

In addition to providing my own transportation -- bus, taxi, or subway -- my other fixed costs were writing tablets to demonstrate handwriting and spelling techniques, novels and textbooks to provide lessons, and pencils and pens.

Really low overhead. I didn't have facilities I needed to maintain. I didn't have to register my name anywhere, or pay a licensing fee.

I am not sure if the same is true for the island's tuition centers, which line the streets of Wan Chai and offer everything from basic math and science tutorials to the big cash cow, English lessons. They even get their photo spreads on city buses.

Free market capitalism never had a greater market to generate profits. A tutor is portable, self-sufficient, and brand recognition all in one.

And it doesn't hurt that the Chinese value education and use it as a means to advance their life and career.

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Outside Operators Eye 250 L.A. Unified School District Schools

The views expressed in the following post come from guest blogger Rob Crawford, CEO of The Life Development Institute in Phoenix, Arizona.

The Los Angeles City Board of Education's vote to allow outside private school providers help turn around the district's education system looks like an opening for those entities willing to do the proverbial "dance with the devil", as this move represents a complete 180 degree turn in how children will be educated in the nation's second largest school district.

This could mean several things, among them: more public financing for privately held companies offering educational services to school districts, as well as a surge of interest in VC and private equity funding of ancillary products and services to education in the public realm.

Bidding for contracts could begin as soon as January 2010. With as many as 250 schools or nearly one third of the district's almost 700,000 students impacted by this decision, the ensuing chaos will create at minimum, short term disruption and displacement.

There are great story lines in this drama- a powerful and connected political bureaucracy, the lure of "school choice", as well as a strong entrenched teacher's union. Popular opinion against political establishment with kids/parents in the middle- a juicy story....stay tuned!

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Fewer Limits on VCs, Now is the Time for Expansion

This op-ed in the New York Times contends that now is not the time to put pressures on venture capital and limited partners in a constrained economic environment.

The article touches off a little brainteaser for me that I have puzzled over in preparing the investor panels for the Education Industry Investment forum in Phoenix, Arizona in March.

It would be a shame to impose any new limits now, when venture capital is the asset class that can best help build and nurture the companies that bring about growth and job creation. The figures are compelling. In 2008, venture-backed companies that went public in previous years accounted for 12.1 million jobs and $2.9 trillion in revenues for the United States Treasury.

It's not hard to define how healthy the education market is right now. While investors are troubled by bank conditions, deals are still being done and growth prospects are high. Investors are even talking about how crowded the market is beginning to look and they are looking for windfalls and opportunity gaps outside of the traditional investing hot spots.

All signs point towards the idea that there is more of an opportunity right now for venture capital and private pools of capital to invest in education.

Howard Levy at Kaplan promotes the idea of global investment opportunities in for-profit education. (pdf)

This is certainly true for Indian companies and Indian investors in one of the two largest markets in the world for education investment.

The other giant market for education, by pure population numbers, is China.

Chinacast, based in Beijing, is a is a leading for-profit, post-secondary
education and e-learning services provider in China
. They look poised to take advantage of a worldwide need for distance learning and vocational training services.

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Hachette Chief Aghast at Google - Amazon eBook Dealings

Arnoud Nourry, chief of Hachette, has lashed out at e-distributors like Amazon and Google for undercutting publishers of paperbacks and hardcover books.

It's not till later down in the story that the beginnings of a non-breaking news story develops. It has something to do with the way European copyright works in different legal jurisdictions. Towards then end of the article there is a brief smoke signal about "rights." I know nothing about what rights they are defending or seeking to preserve. Is it profit? Doesn't market competition have something to say about that?

Nourry basically says this:

“On the one hand, you have millions of books for free where there is no longer an author to pay and, on the other hand, there are very recent books, bestsellers at $9.99, which means that all the rest will have to be sold at between zero and $9.99,” Mr Nourry said.

There was a real and “muscular” debate in the industry in the US, he added. Retailers were paying publishers more than $9.99 for each e-book, so were selling them at a loss: “That cannot last . . . Amazon is not in the business of losing money. So, one day, they are going to come to the publishers and say: by the way, we are cutting the price we pay. If that happens, after paying the authors, there will be nothing left for the publishers.”

Some rival publishers have expressed concern in private at Amazon’s fixed $9.99 per title pricing on its Kindle electronic reader. Others note the minimal costs of distributing books electronically mean they can make higher profit margins even with lower prices than in print.

Where do you fall on this debate? I tend to think that Amazon and Google are fully in their rights to innovate, but so too are the Hachette's of the world.

It's not clear if Hachette is frozen out of negotiations here or if there is something in the business model that just prevents Hachette from ever being able to compete with Amazon or Google over free e-books.

A clue to the issue, though not fully articulated, comes here, same article:

Resistance to the Google books project from European libraries appears to be easing, with the National Library of France confirming this month that it was working with the US internet giant. But European publishers say they are determined to defend their rights.

Is an Amazon platform or a Google platform patently unfair?

Does innovation unfairly bring more profit to technology and distribution providers who innovate?

Is the Google free books project indeed a ransacking of copyright and potential profitability for publishers of authors long dead?

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Friday, August 28, 2009

Friday Diversion

Here's something for your Friday diversion. One hundred years of movie special effects in five minutes.

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Thursday, August 27, 2009

Around the World in 30 Days

I did a little arithmetic. By the time I am done with The Road Trip for Education, I will have traveled a distance nearly equal to the circumference of the earth.

Using a rough bit of calculations from Google Maps, I sketched out each of my destinations and measured the distance between each, factored in the back and forth, a little driving and a few walks up and down the beach and I came up with this.

Distance traveled during Road Trip: 21,500 miles
Circumference of the Earth at the Equator: 24,901 miles

How's that for a Road Trip?

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Wednesday, August 26, 2009

Sony E-Reader to Launch in December

Will it have an education component like the rumored Apple tablet?

The Sony eReader will compete with the Kindle 2.

There are some aspects to this device that may be positive for school districts.

1. The device allows the user to type in a zip code and obtain virtual copies of books from the local library branches.

2. The device is not tethered to one single distribution center like the Kindle 2.

For a review of what one school district is considering, check out this comment from Matt Mello, technology director at Holly Area Schools:

Would be great if the Sony solution permits single point of administration of content for their wireless eBook readers. Its quite apparent that Amazon does not have this capability.

We're evaluating eBook readers as possible replacement for our school district's textbooks. We purchased several of the larger Kindles and though a great reader for individuals / consumer market, Amazon does not have a solution for distributing and controlling a volume of eBooks devices.

It is clear that Amazon doesn't even have a strategy for this, based on experiences of calling their customer support. They had no information to offer, either now or in the long run. Their only solution is to have an individual email account tying each Kindle to an end-user. This is very problematic to manage for several thousand students. Also, you cannot speak directly to a Sales or Technical Acct Exec for Kindles at Amazon. Only someone who has general information.

I hope Sony develops such strategies as central point of administration for managing a volume of wireless eBook readers and have an organizational account structure where there is an individual / team with whom we can speak directly on product features or support.

I think these strategies would be key selling points and allow widespread adoption by educational institutions.

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Hottest New EDUpunk Company?

Has anyone been following what I consider to be the hottest new EDUpunk company in our space: Flat World Knowledge?

In addition to making their e-texts free, they can be edited by faculty members, and students can sell their lecture notes to make some extra cash. Also, check out TextBookMedia, as they are knocking it out of the park as well. I'd love to hear your thoughts.

Incidentally, Jeff Shelstad at Flat World Knowledge was a speaker at the 2009 Education Industry Investment Forum in Phoenix.

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Tuesday, August 25, 2009


Hello, Everyone.

First I'd like to thank Doug for his work in making this happen and I look forward to meeting each of you.

I'm curious to see if there are any fellow EDUpunks here.

I'd love to hear some of your thoughts about angel investments within our space as I've kicked around the idea of launching EDUinnovators where we would allow EDU innovators a place to upload a short elevator pitch (preferably video) and invite investors to see some of the hot opportunities in our space...


Steve Cooper
Founder, Tech University of America

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Friday, August 21, 2009

The Road Trip for Education -- EIIF Hits the Road

Ten Cities. Thirty Days.

Next month, I am going to be flying all over the United States and to one city in Canada to meet the new leaders in for-profit educational services and learning in North America. This is my attempt to glorify and promote what has become one of the most successful strategy sessions for investors in for-profit education in K12 and post secondary schools and services.

Do you want to be included in this list? We have spots for five more interviews, and then we will have to close the door on new applicants.

Each of these interviews will be showcased on this blog, and also at other sites around the web, including Fast Company, where I manage a blog on entrepreneurship in Asia and abroad.

Here's the list of confirmed meetings, along with the cities (dates are not final, yet):

New York City

Stephen Tave, American Higher Education Development Corporation
Elliot Levine, Hewlett-Packard Education Services
Bernard West, Banyan Education Capital
Meg Mude, Entrepreneur


Dr. Darcy Tannehill, Chicago School of Professional Psychology
Andrew Howard, Brain Hurricane

Washington, DC

Doug Mesecar, Scholastic
Bobbi Kurshan, Curriki
June Herald, KinMix
Scott Fleming, Madison Education Group
Michael Ratti, Regent Education
Members of K12,Inc

San Francisco

Dennis Diligent, CPP, Inc.
John Grillos, WorldSage, Inc


Peter Stokes, Eduventures, Inc
George Kane, Pearson Education
Amit Shah, Green Comma


Toby Chu, CIBT Education
Dean Dupperon, Sprott-Shaw Community College

Los Angeles

Charles Paul, World Wise Education
Alex Kaplan, IBM Educational Services
Sabrina Kay, Fremont College
Rob Chandler, Fairmont Schools

Fort Lauderdale

John Hage and Carl Tsang, Charter Schools USA


Steve Cooper, Tech University of America
Dr. Clinton Gardner, NorthCentral University
Gene Hayes, Piccolo International University
Rob Crawford, Life Development Institute

And that's it...

So Far.

It looks like it's going to be a great month of learning, investing and spreading the word about the 12th Annual Education Industry Investment Forum in Phoenix, Arizona, March 1-3, 2010. Come join us!

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Thursday, August 20, 2009

Africa Becomes Fastest Growing Continent

Africa now has one billion people and the highest population growth rate of any continent.

What institutions are building for-profit inroads into education there?

If you know of anyone, please let me know. I am interested to find K-12 for-profit education, online education, distance learning and post secondary institutions that treat Africa as a -- very large -- marketing demographic, as complex and as populous as it is.

Although population growth has slowed in North African countries such as Egypt and Tunisia, on average women in sub-Saharan Africa have more children than women elsewhere. While globally the average woman has 2,6 children, in sub-Saharan Africa she has 5.3 children (which is down from 6.7 children in around 1950). The world's highest fertility rate is in Niger, where women have on average 7.4 children.

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Wednesday, August 19, 2009

Teacher Voices Frustration Over Hiring Freeze

Recently, a teacher confronted New York City School Chancellor Joel Klein over a hiring freeze.

Does the current climate lend itself to finding more online solutions? I've been hearing about pressure being put on budgets that lead to the cutting of teacher positions, these freezes on new hires, and most pressing of all, halts on spending for teacher development.

Why is professional development one of the first choices in the budget bloodletting? Intuitive logic would tell us that if you are keeping the teacher from developing his or her skills, you are making them less integral to the teaching curriculum, thereby fulfilling a maligned sort of destiny -- cutting salaries or positions.

Seems like a type of cycle.

This will be one of the topics at the Education Industry Investment Forum held in Phoenix, Arizona March1-3. 2010.

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Flying Around America, Looking for a For-Profit Education Business Model

A perfect for-profit education model may not exist.

As many operators and investors and financiers there are, there are just as many business models.

But I am going to make an attempt to find the best ones that I can.

From September 8 to October 8, 2009, I will be flying to several different cities around North America searching out and interviewing the young, the old, the good, the bad and the ugly in for-profit education.

I'm taking nominees now. I've already sent out several invitations and gotten a few acceptances. I will be meeting with a few people in the following cities during this month long Road Trip for Education.

Here are the cities so far:

Austin, Texas
Chicago, Illinois
New York, New York
Vancouver, British Columbia
Seattle, Washington
Phoenix, Arizona
San Francisco and Los Angeles, California
Washington, DC
Orlando, Florida
Fort Lauderdale, Florida

If you live in or near these cities, and you fancy yourself a leader in for-profit education, or if you know someone who is a leader, leave me a comment on this blog, or email me at dcrets [at] iirusa dot com. Let's talk.

The schedule is being worked up now. Put yourself into this conversation and you will see our video interview together on this blog and on other social media sites.

You will also have an opportunity to be a guest speaker at one of our breakfast meetings in New York City and the March 1-3, 2010 forum in Phoenix, Arizona.

More information here: Education Industry Investment Forum.

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Monday, August 17, 2009

On the Web

Links we are looking at today during our research for the 12th Annual Education Industry Investment Forum:

Education Dynamics

So, what's an e-reader? Is that like electronic ink?

How much should you pay a teacher?

Do textbooks cost too much?

The Chicago School for Professional Psychology

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Friday, August 14, 2009

Tabula Digita and The Rise of Edutainment

Some of you may remember Ntiedo Etuk from his appearance at the 2009 Education Industry Investment Forum, which we held this year in Phoenix, Arizona.

At the time, Ntiedo was pitching an exciting new-ish company, Tabula Digita and telling a great story about the need to mix enterainment, gaming and education to help students learn.

I've just learned that the company hit cash flow break even and is on track to hit revenue of $10 billion in 2010.

Tabula Digita is the sort of company that ought to be heavily funded and rapidly scaled so it can gain adoption in as many school districts, as fast as possible. For that, more venture capital would certainly help. Yet VCs are still skittish about education. "VCs do not understand the school system ... because the money is coming from a school district instead of a business," Etuk says.

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Thursday, August 13, 2009

Oh, Ye of Little Faith

Are you one of those hard-scrabbled doubting Thomases who insists on believing that education will not weave itself beautifully with technology?

I hope you are not. If you are not, and you are easily excited by the dovetailing of the most recent technological developments with education efforts that will inspire hordes of children to become the leaders of their generation, then you must get a whiff of this recent Apple technology rumor:

Apple is developing a touch-screen tablet PC and one of its versions will be for educational use.

From Gizmodo, your latest in plausible deniability:

They went on to say that although the project has been going on under various names between four and six years, the first prototype was built around the end of 2008. Adding, "The time to market from first prototype is generally 6-9 months." That would place the device's release date in this holiday season. They then said, "There was a question of what OS the device would run, too." (Other people I've talked to have implied this remains a huge secret.)

My call dropped on some windy road off skyline drive.

Later, I asked, was there a code name for the project?


I thought about it for a second, googled the term, and it all made sense.

"Don't publish that name, please, " they requested.

Don't worry, I won't.

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