#OpenForWork

John Richard Martin

I’ve been keen to learn and to help others to grow as I look for a new job.

New (ad)ventures

Edtech has been a natural focus and I’ve connected with about 60 edtech ventures across the spectrum. How inspiring and energising! In the meantime, I’ve invested time and money in four of them, in all cases because of their learning impact, business potential and highly talented leadership. From a personal perspective also because I can add value through my expertise, experience and network.

  • Kognity, provider of digital courses for K-12 (Stockholm)

  • School Day, data platform for student well-being (Helsinki)

  • Edurio, provider of school improvement diagnostics (London)

  • Hypocampus, digital courses and platform for higher education (Gothenburg)

Go with the flow

I’m advising two financial sponsors. This is a great way to work with excellent people on the latest deal-flow in the industry from early…

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Higher Education and the Coronavirus: Never Waste a Good Crisis

Higher education is about to experience a sharp shock caused by the coronavirus crisis.  The buoyant market for international students is likely to contract significantly as uncertainties around travel continue. Local markets will be under pressure as universities struggle to open and students baulk at the experience (and cost) of online learning. This week has brought us new insights into how universities might fare.

Tale of Two Cities

Some universities, including Harvard, have decided to offer online only in the new academic year. In Harvard’s case this will be for the same tuition fee as the campus experience – about $50k.  The expectation is that the brand power of these institutions is so strong that students will still enrol. Furthermore, their premium brands will help them to monetise their newly online offerings in international markets and they will likely also compete more aggressively in their home markets. This pivot in the business model, coupled with their endowments, should enable elite and higher end universities to weather the storm.

Elite universities will use their brand power to adapt and the weakest universities will struggle for survival.

Other universities are at significant risk of insolvency. The BBC reported this week that 13 of the least prestigious universities in the UK are potentially in trouble, facing lower student income and high costs.  Without major restructurings and bailouts, there may be casualties.

Third Way

What if you’re a mainstream university, not at either of these extremes?

Most students aspire to the “life” and “live” experience of the campus above a laptop

Mainstream universities wanting to secure enrolments at scale will have to find safe ways to offer a campus experience for their existing core business. I would do three things:

1. Go blended: transform the core offering to lectures online and tutorials face-to-face

Most lectures will have to be delivered online, to avoid mass spreading of the virus via auditoria.  Unfortunately this will likely lower the attractiveness of the overall learning experience and also increase the risk of drop-outs. The best way to remedy those disadvantages is to concurrently increase the use of (preferably) face-to-face tutorials individually and in small groups.  A higher intensity of interaction with faculty can improve learning outcomes and boost student engagement.  This will be quite demanding on faculty, who will need to become expert in online teaching and commit more time to tutoring.

2. Find new markets: use digital and local relationships for new sources of income

I would in the first instance probably prioritise two areas if a competitive advantage can be found. 

Firstly, open up the new digital offering outside the campus – both as a degree and in modular and snackable programs.  Is there something distinguishing about the content/courses you offer (London & finance, Milan & fashion, Bordeaux & wine) that you can take global now you are digital?  Is there something in the user experience of your digital learning offering that sets you apart (for example GetSmarter deploys real tutors to assess assignments)?  Is there a price point that makes you competitive to new segments?

Secondly, given that digital offerings will be abundant and everybody is going global, why not go back to the roots of the establishment of your institution and go local.  There are major upcoming skills gaps in healthcare, teaching, technology and so on.  Why not partner with local industries, and local health and education authorities to better support employment needs of the local market.  It will be much harder for digital universities on the other side of the world to win that competition.

3. Fix the finances

Regrettably it seems inevitable that the cost of running some universities will need to be reduced and become more flexible. A large part of the cost base is staff and buildings. Painful. This should be considered together with the change in operating model needed to deliver blended courses described above.  In addition, it might be necessary to raise additional financing, through government loans and grants, bank loans, and alumni gifting, to bridge the overall transformation.

Never waste a good crisis

The triggering event of the coronavirus is a painful crisis.  It’s also an opportunity for us to re-design education for increased access, higher learning outcomes, improved employability locally and better affordability.  Let’s not waste the crisis.

#OpenForWork

I’ve been keen to learn and to help others to grow as I look for a new job. 

New (ad)ventures

Edtech has been a natural focus and I’ve connected with about 60 edtech ventures across the spectrum. How inspiring and energising!  In the meantime, I’ve invested time and money in four of them, in all cases because of their learning impact, business potential and highly talented leadership. From a personal perspective also because I can add value through my expertise, experience and network.

  • Kognity, provider of digital courses for K-12 (Stockholm)
  • School Day, data platform for student well-being (Helsinki)
  • Edurio, provider of school improvement diagnostics (London)
  • Hypocampus, digital courses and platform for higher education (Gothenburg)

Go with the flow

I’m advising two financial sponsors. This is a great way to work with excellent people on the latest deal-flow in the industry from early stage to IPO.

  • EdtechXHoldings, is coming with their Special Purpose Acquistion Company II later this year focusing on the future of work and education. It will be listing in New York, and is working on acquisitions in the range $300m-3bn.
  • Sparkmind.vc is a Helsinki-based venture capital fund, investing in early stage edtech

Scale-up

I’ve been working a strategy consultant and coach to two scale-ups in higher education, which has been an excellent opportunity to help them with their growth strategies and to learn more about that market segment.

Always Learning

Always learning, right now I’m working on a MicroMasters in Educational Innovation and Improvement on edX (for the learning) and various courses on MasterClass (for the fun – beautiful design and production quality).  If only the two could find each other …

#OpenForWork

Until I find the next big assignment, I will have some availability again after the summer.  I’m especially looking for consulting, advisory and interim work mainly in the following areas:

  • Sector: education, science, healthcare, medicine
  • Expertise: digital transformation, leading change, commercial, strategy

If you have a challenging assignment and if you think I could help your organisation to prosper, feel free to reach out at johnmartin@contentconnected.com.

Looking forward >>

The Future of Work in Europe: Back to School

Double dose of disruption

New research from McKinsey suggests that automation and the coronavirus crisis are likely to disrupt many occupations in Europe. They estimate some 51m jobs are at risk due to automation and 59m from COVID-19 to 2030, with a sizeable overlap of 24m jobs exposed to both developments.

Large overlap between jobs at risk from coronavirus crisis short term, and automation long term. @ McKinsey Global Institute

Jobs at risk of being done for

The wholesale & retail, manufacturing, accommodation & food services and construction sectors appear to be particularly exposed, with some 15m jobs at risk.

Jobs at risk by sector @ McKinsey Global Institute

Learn to earn: growth expected in high skills jobs

Some occupations are expected to show significant net job growth in the coming years, with STEM professionals (+4.0m net job growth to 2030), business and legal professionals (+3.9m), health professionals (+2.9m), managers (+2.3m) and education (+2.2m) showing significant potential. These occupations employ a relatively large share of highly educated workers.

Much of the pain is expected to sit in office support, production work and customer service & sales. The great majority of employees in these occupations have not completed tertiary education. 80% of the jobs flagged to be at risk (46m) are carried out by people not holding a tertiary degree.

Europe needs to create more training and career pathways

Education and training have a pivotal role to play in addressing the economic and social impact of this changing job market. Skills are likely to be a key factor in determining recovery from the coronovirus crisis and future prosperity.

Good quality schools, good access to tertiary (particularly STEM) and further education, and the commitment of governments, companies and individuals to ongoing skills development can all contribute to positive employment outcomes.

Re-design for the future

We have rightly seen emergency measures implemented across the World to keep our societies and economies afloat in the midst of the coronavirus crisis. This has come at a huge financial cost. With good reason, the emphasis so far has been to maintain the status quo, to minimise the economic and social chaos.

In the coming period we need to look critically at what the next generation of work will look like and to design interventions that prepare us for that future. This will likely be a job market demanding higher levels of education and skills, and where large numbers of people will need to transition from offices and shops to hospitals and schools for example. How do we organise ourselves for this change?

Best practices

I’m especially interested to learn about initiatives and best practices from institutions preparing for this transformation:

  • organisations that are re-skilling their workforce
  • schools and post-secondary institutions that are adjusting their offerings
  • successful companies that are offering services to close the skills gap
  • new education policies from governments that are intended to enable the transition to new work post-corona.

Feel free to reach out if you know of any great examples!

Looking forward >>

What’s the impact of the coronavirus outbreak on the edtech industry?

 

Earlier today we had an online meeting of edtech entrepreneurs mainly from Northern Europe, organised by Heikki Rusama, CEO & Co-Founder of the teacher platform Freeed.com.  He interviewed me to share views on the possible impact of the corona-crisis on the education industry in general and edtech in particular.  It was great to see these entrepreneurs, albeit at a distance. I made an abbreviated transcript below for those who couldn’t join.

Heikki: Schools have been closed in Finland and we are now planning to open them again. ​What is the impact of the coronavirus outbreak for the education industry and edtech industry specifically?      

“One billion children in lockdown”

John: There are about 1.5bn school-aged kids globally and about 1bn of them are currently in lockdown-type situations. Some places, especially in Northern Europe are about to start experimenting with coming out of it.

We’ve seen massive disruption to the operating model, impacting the learnflow of pupils, the workflow of teachers, and the communication channels and the wellbeing of everybody.

This is a very sorry situation for society as a whole, it’s probably mixed news for education depending on the role in the value chain and the time frame, but overall this is probably quite positive for parts of the edtech industry, arguably a once-in-a-lifetime triggering event for deploying edtech.

“Once in a lifetime triggering event for edtech”

Short term, from an education industry perspective, there’s good news and bad news:

  • The short term winners are likely to be the big platforms and digital or blended incumbents. Probably Microsoft and Google will benefit most of all. Some incumbents might benefit if they’re well invested in digital and also because they’re known and trusted and have existing customers and established channels. People tend to choose for safety in a crisis
  • The hardest short-term pain is likely to be felt by universities (especially those with a heavy enrolment of international students) and private school chains, as social distancing significantly disrupts their operating and earnings models.

Medium term, it’s possible that education might benefit, because we’re likely to have a fierce recession or depression; although this is negative for society as whole, it normally gives a boost to education as people seek to acquire skills, upskill and re-skill and use their time usefully between jobs.

Long term, the impact is harder to predict and arguably depends on whether we have a rapid “V-shaped” recovery, or if we will have a more protracted “W” or even an “L-shaped” recovery (hopefully not!).

If it’s a V-shaped recovery, then probably the most likely outcome is a step change towards digital and an acceleration of the current direction of change to an ever-higher penetration of digital in the mix.  In other words, learning and teaching become incrementally more digital within a blended model.

However, my personal view is that we’re likely to go into an extended period, maybe 1-4 years, of the “1.5 metre society”.  This being a period of social distancing and intermittent lockdowns, until either a vaccine is deployed, or medications found, or group immunity has been established.  With current immunity at about 3-4% of the population, we are currently far away from the 60-70% required to achieve group immunity, so opening-up society will likely lead to rapid increases in new infections and new lockdowns.

“New operating model for schools?”

What does a “1.5 metre school” look like? There are probably lots of variations, but this will probably mean smaller classes, more learning from home, basically a new operating model, with a very significant digital element.

This scenario is likely to be quite bullish for the edtech industry. Here I think the bigger school-level platforms are likely to prosper in K12, and the big brand universities with a strong online presence will win in Higher Education.

However, in this scenario, state funded education systems and privately funded schools are likely to come under significant financial strain as costs rise and public spending and private wallets come under pressure. It might therefore be the case that some digital-first-institutions and -companies might prosper within an overall less healthy market than it would have been without the corona-crisis.

“New opportunities for new ventures”

So you are all leading start-ups and I think your advantage might come through agility.  I would expect the winners in the start-up space compared with the pre-corona situation to be

  • data-driven business, which will get even hotter than they already were, as it has now been shown that customers might be a bit less squeamish about data than was earlier the case,
  • companies enabling teacher workflow, since the time of teachers will become an increasingly scarce and precious resource,
  • well-being and social emotional learning approaches are likely to get a boost.

Heikki: Many edtech companies have reported exceptional usage and even sales numbers during the crisis. Do you think that the impact will last beyond the pandemic era?

“Digital usage likely to drop back somewhat from current peaks”

John: I reckon current usage levels are probably exceptional because

  1. The model is now predominantly pure-play distance
  2. Usage is nearly always highest around the time of a triggering event

When the norm is once again face-to-face, use of digital will probably fall back somewhat, and when the triggering event is behind us, the novelty effect will also fall away.  I do expect there will be a structural increase, but usage will fall back as schools open.

Heikki: Many companies have opened their offering for free during the crisis. Do you think this is a good strategy?  

Do “good” business

John: The way I see this is that we lead “missionary businesses”. Morally I think it is in many cases the right thing to do at this time.  Our societies are going through the biggest crisis of our lifetimes and we can help. It’s our duty to do the right thing and help.  Whether it makes sense from the perspective of the long-term business strategy, I don’t know, but would be inclined to be positive:

  • Is a freemium model in any case the right thing for your business?
  • If not, schools might be more inclined to feel goodwill towards you when you eventually ask a price, if you were generous and not profiteering from them in their darkest hour
  • For the long term, I tend to think that quality and reliability are more important factors in education than price (free), and charging a fair price for a good service according to competitive market practices is a sustainable approach
  • Overall, depending on the business you’re in, I can see that offering some months for free, maybe till the summer, might be most helpful to teachers and pupils, and might create goodwill for the future.

Heikki: Over the years you have consistently spoken about the importance of technology, but also advocated the blended learning model, combining the physical and digital. Has something changed during the corona-crisis in your thinking? Have you changed your mind about edtech in some ways during the crisis? 

“Blended learning with a stronger digital element has great prospects”

John: I remain a big believer in the blended model. This model is also working well in the crisis. You know, books also work very effectively in homes as well as schools, it’s not just about digital.  I do think physical proximity of teachers and pupils is essential to good K-12 education and distance learning is essentially a poor alternative for this age group. But I’m happy to see digital boosted in the mix.  What has surprised me has been the relative ease of transition to online models, and particularly the deep penetration of Google and Microsoft.  It feels like a journey that was taking 10 years, got accelerated into two weeks!

Heikki: It seems that this pandemic provides a massive exposure for edtech companies. However, some fundamental issues remain. One of those is the question of sales & distribution channels. There are several national and international initiatives, trying to solve this. The key question is, I think, how to make the “edtech ecosystem” stronger and less fragmented, together?

John: the pandemic doesn’t in any way solve the go-to-market problem. It’s good to have open marketplaces with easy procurement processes and it’s helpful to have start-up networks and so on, these initiatives are worthy. In edtech I don’t think there’s a shortage of ideas or talent.  I don’t think there’s a shortage of money for good businesses.  Sparkmind.vc in Helsinki should bring a nice boost!

However, and I realise this might not be a very popular view to this audience, I believe the fundamental problem of European edtech is that it’s sub-scale and fragmented. It will be very hard for us to compete with the Chinese, Indians and Americans on the tech part of edtech in the long term. We can compete on local market approaches and pedagogy however. We have to solve the problem of fragmentation and lack of scale.

“Imagine your life as a teacher”

Also think about it from the customer perspective. Think about a teacher. She is mainly concerned about leading what is often an unruly classroom, effectively. There are vocal parents and there’s lots of administration to do. Teachers simply don’t have time to listen to sales pitches from 3000 edtech companies nor use 3000 different solutions.

So it’s my belief that we need to enter the next stage of maturity as an industry, to move from fragmentation and to start to consolidate around a smaller number of national and regional, maybe even global champions with strong and maybe rather broad portfolios and deep networks. And we need to inter-operate across the ecosystem.

Edtech ventures might typically want to experiment with three alternative go-to-market approaches: direct, via distributors, and with partners. In addition, it might also make sense in many cases to integrate with Microsoft and Google, they have good experience in interoperating their networks.

“Go local!”

I do have a bit of a hobby horse with education which goes against a major dogma in digital markets.  In digital everyone says you need to “go global”.  You know, K-12 education is really a local market.  My view is that you need to become a “system player” in a local market to succeed. “Go local” is my credo in education 😊.

Heikki: Who should take lead in this? Global tech giants, Big educational publishers, countries or individual companies?

John: It varies per country and segment.  Who are the bigger companies serving the customers you want to serve?  Can you partner with them?  Can you learn how they do it?  Take the initiative and go and speak with them.

Heikki: Does this time make you a more or less enthusiastic edtech investor?

John: I’ve always been an edtech enthusiast.  Broadly speaking, the corona-crisis is probably bullish for the edtech sector. From an investment perspective, alongside investing in attractive edtech assets directly,  I’m also thinking in a contrarian way.  Might it as an investor also make sense to buy out-of favour “legacy assets” and transform them to digital using edtech?

Heikki: What technologies or concepts are you the most interested in at the moment?

John: I always think you have to look at what the problems are that need to be solved, and what’s scarce: Two areas particularly interest me:

  • Supporting teacher workflow (globally a major shortage of teachers and growing pressure on their time)
  • Data driven approaches – insights are currently barely being used in education and market has just proven itself to be a bit less squeamish than it was about data

Heikki: Finally, what are the 3 things that every edtech entrepreneur should care about? 

John:

  1. Building a winning team is key to everything. Hire the very best people you can get.
  2. Put the user-experience first in your offering. Make it really easy to use. Teachers have complicated lives. Make it easy enough that a teacher leading 25 unruly kids all at the same time, can use it with ease.
  3. Work out your go-to-market approach and especially which markets to be in. Go local!
  4. I will add a fourth bonus point if I may. We’re going into an uncertain future, ranging from a rapid recovery to a depression. People are generally bullish on edtech right now, there is money in the market.  Make sure you have your funding in shape, and you have a good runway ahead of you.

After the interview we had interesting updates from Sari Hurme-Mehtälä, CEO at Kide Science about recent successes in China, Kristo Lehtonen CEO at 3D Bear about the great exposure they have had with Apple and Google, and Heini Karppinen, Chair of Edtech Finland, encouraging everyone to stay connected.  Very helpful!

Thanks for participating.  Keep the faith and stay safe!

Looking forward>>