EdTech II – College/Higher Education

This post is the second of a three part series on EdTech. Check out part I here

Higher Education

Higher Education refers to colleges and institutions offering undergraduate, graduate and other degrees.  As a recent college graduate myself, learning about this section was pretty relatable and interesting.

Stop. Being. So. Expensive

College in the United States is stupidly expensive, and this video does a great job of explaining it. Or this article. This particular visual in Scott Galloway’s video was perhaps most shocking –

Largely driven by this enormous increase in costs, the world of higher education is starting to see a shift away from college and towards other forms of education and skill development. For example, MBA applications, even to elite programs normally considered immune from these shifts in education preferences, are reporting steep drops. This shift can be broken down into a few trends –

• Students are becoming increasingly ROI driven – ROI, or Return on Investment, can be thought of in a very simple way – do the benefits of a college degree outweigh the costs? Let’s talk about an MBA – if you do a simple google search across MBA programs, annual tuition + school supplies + other fees for an elite MBA program is roughly ~$75,000 a year (I haven’t used COA as that includes rent/living expenses which aren’t incremental). Across 2 years that’s $150,000; assuming an opportunity cost of $350,000 (salary or earnings across the 2 years one takes off work) that makes a super rough cost of $500,000. The big question is do the benefits from the MBA program (salary bump, network, etc) outweigh half a million dollars? More and more students, especially international students, are questioning this and are leaning towards no.
• The rise of micro/nano credentialing – Online learning companies such as Coursera and Udacity offer what they call ‘micro’ or ‘nano’ degrees – shorter, cheaper online programs that give people the skills needed in particular jobs or industries. Such programs are increasing in popularity due to the reduced cost, ease of access, and the fact that these to some extent do signal value to employers.
• Don’t need a college degree to get a job –Tesla, Apple, Google, and Netflix are just some names of the several top companies that do not require a college degree to get a job at. This goes hand in hand with micro and nano credentialing. Employers just want to know whether you can do a job right, not if you have a degree.

Impact of the Virus

The virus forced colleges across the United States to finish the academic year virtually over Zoom or other video platforms. This is likely to continue (at least to an extent) into the next academic year, with colleges announcing plans to stay virtual or at least have some virtual element – just today my alma mater the University of Pennsylvania announced a hybrid method of instruction for Fall 2021, with larger classes being completely online. But is this going to stick? I don’t think so – surveys conducted across Universities highlighted students’ dissatisfaction with online courses (I hated finishing college on Zoom). I don’t see much evidence to support success for companies trying to take the college experience virtual (for those who are looking for a true traditional college experience). Sure, in the short-term universities are going to be looking for efficient ways to facilitate hybrid learning until it’s completely safe to resume in person instruction. But in the medium term, colleges which stay open will probably still look to deliver core instruction in person.

I mention colleges ‘which stay open’ to acknowledge the fact that the pandemic has ravaged the economic situation of universities to the extent that several of them are being forced to cut academic departments altogether. Low enrollment, deferred admission, and cancelled programs due to Covid in addition to declines in state funding already being experienced are some factors that lead some to claim that some colleges will be closed for good.

Let’s bring it together

With the cost of higher education showing no signs of declining, the mountain of student debt increasing each year, and colleges themselves going through a swarm of problems, I strongly believe that colleges are going to have to adapt to survive.

Colleges are going to have to compete with micro/nano credentialing head on – and by that I mean enter the market themselves. To some extent they already have – you can find specializations or tracks from elite universities on platforms like Coursera – but not to the extent they’re going to have to. Putting newly structured offerings online allows top Universities to leverage the most important thing going for them – their brand name – and increase access to education and skills. It’s definitely a delicate line to tread – increasing access significantly could diminish their brand value as it hurts the exclusivity these college work so hard to maintain – but if they don’t adapt, they’re going to slowly stop becoming the clearly preferred option.

While Universities could develop in house capabilities to develop new virtual offerings, the urgency with which they need to do so has resulted in a different big winner in this situation – the OPM (Online Program Management) market. OPM companies, simply put, help universities take their offerings online – examples of companies in this space include 2U and Pearson. Another OPM company, Noodle Partners, just raised $16M in a Series B. These companies have seen an acceleration in business as universities try to push their offerings virtual to respond to the virus. OPM companies should seize this opportunity to leverage the relationships they build during this time and convince Universities of the value in creating more virtual programs and nano degree-esque programs.

But until that happens, let’s modernize campuses

All this isn’t to say college as we know it will cease to exist. The shift to micro credentialing and the closure of some universities does not mean that in 10 years people won’t be going to college anymore – college will always keep its appeal of being a formative aspect of peoples’ lives and at least in the foreseeable future, keep the brand signaling it provides students. While increasing online offerings would be a big step to increase access to a quality education and help Universities stay current to the times, there will still be people with the means and desire to go to College.

College life has modernized over the past decade – through the adoption of Learning Management Systems, collaboration tools and discussion forms such as Piazza, etc. Continuing with that trend we can expect to see more innovation to keep the college experience modern and savvy. Tools like Stellic (that allows students to map out their journey to graduation), Campuswire (streamline classroom conversations) raised seed rounds in late 2019, and we can expect to see more tools that take the tangentials of college online. One company that especially piqued my interest is ‘Examity’. Examity is an online proctoring company which raised around $90 million from Great Hill Partners about a year ago. Usage of Examity surged with the virus, and while anecdotally students didn’t seem to be big fans, there’s no reason why the future of college life doesn’t have more tools like this – which make the seemingly non value add aspects of college virtual (or just make college life simpler). Beyond the simplification of college life, I’m also excited to see how elements discussed in the K-12 section about adaptive learning and AI/ML to analyze and predict student success could be integrated into the college way of learning.