10 years ago, in March 2009, USV hosted an event called Hacking Education. The team pulled together a group of operators, founders, and investors to talk about how to create transformation in education. Following the event, my partner Brad wrote a blog post about his takeaways. At the end, he summed it up: “The challenge for all of us it to find ways to exploit technology to reduce the cost and increase the accessibility of education.”
This concept has stayed top of mind for USV over the last decade. We only rediscovered this post a couple of weeks ago, but the idea of leveraging technology to broaden access reappears as the central idea of Thesis 3.0 published in 2018. It also serves as the common thread of our education portfolio that’s been built since that event and remains our lens for where we think the biggest opportunity and need sits today. It’s time for a major restructuring around how we learn and the way to create it is through new products and services that drive up value and down cost for users around the world.
Why? While technology has fundamentally changed almost every element of our lives, how we learn looks almost identical to how it looked 50 years ago. As Dani lays out in this post, too much of education is stagnant while the wrong things are in rapid flux. Test scores (still our most accepted “quality” measure), teachers’ salaries, earning potential for degree holders remain flat. Student debt skyrockets and government aid falls. We have spent a lot of time lately studying this chart:
It shows 1) the cost of education has risen faster than any other bucket of consumer spend over the last 20 years. 2) Most of our investments, and venture investments in general, have been dedicated to the bottom half–buckets of spend that have gotten systematically cheaper, at least partly (and maybe largely) through technological innovation. But how can we help catalyze that same movement for the categories in the top half?
In education, we think the products and services that will help create this change have commonalities that are reflective of the broadening access goal Brad wrote about in his post. We think they will:
- Drive up value and down cost
- Lower geographical boundaries
- Operate outside the traditional system, driving change outside in
- Be outcome, not credential, driven
At the time of Hacking Education, the USV education portfolio was nascent. Since then, USV has invested in businesses like Duolingo (2011), Quizlet (2015), Skillshare (2011), Outschool (2019), and Codeacademy (2011.) These companies are tackling different elements of the education stack but have the above criteria in common.
Our education portfolio has become a core value driver in our funds. In part, we think this is because we have hit the tipping point in consumers’ interest in self-driven, direct-to-learner education because technology has enabled higher quality education to be delivered at a lower price point, a counter-balance to the inflationary trends we’ve seen to date. Appetite for products and services that reframe what it means to learn – and how to learn – is high, and quickly accelerating. Which is all to say, we’re ready for more and eager to meet the teams that are building the products and platforms that will restructure education.