THE NEW EDUDOTCOM:
BOOM, BUBBLE OR BUST?
Ellen Wagner
Western Interstate Commission for Higher
Education Cooperative for E...
Session Description
• Excitement around innovations in collaboration
technologies that promote learning and engagement is
...
Why We Care
US edu. expenditures:
$1.4 Trillion
Global edu. Expenditures:
$4.1 Trillion
Michael Moe, April 16, 2013, ASU/G...
Education’s Internet Moment
• Investments in education-technology companies
nationwide tripled in the last decade, shootin...
Today's investors believe this round of .edu
growth is different from the last dot.com.
Michael Moe, GSV Asset Management,...
Wait – did someone say “Bubble”?
• Government subsidized debt, also known as financial aid,
fuels much of higher ed growth...
The “Bubble” Phenomenon
• A financial bubble is defined by values that are inflated beyond
what the market will bear, or w...
FOUR ASSUMPTIONS ABOUT
THE HIGHER ED MARKET
(Mrig, 2013)
The New EduDotCom 2013 8
Demand for Higher Education is Inelastic
(Inelasticity - The situation in which the supply and demand
for a good are unaff...
New Sources of Revenue are Always
Available
• Public Funds
• Endowments and annual giving
• Tuition
• Enrollment Managemen...
Higher Education is always consumed the
same way
Traditional
• On campus, in the
classroom
• Semester/quarter based
• Cour...
…(pay no attention to all that “Free”
education out there...)
The New EduDotCom 2013 12
The Public’s Faith in Higher Ed is
unwavering
http://www.technologyre
view.com/featuredstory/
429376/the-crisis-in-
higher...
The New EduDotCom 2013 14
MAXIMIZING YOUR
PROBABILITIES FOR
SUCCESS
The New EduDotCom 2013 15
The biggest reason this boom might not
be as different as you think
“…It’s because no matter how new your tech, or how gre...
It’s not about the TAM
• Don’t focus on the TAM (Total Available Market). Focus on
your TSM (Total Serviceable Market) – t...
Think Like an “Educatian”
• Educators care about mission, not about markets.
• Listen for what THEY want to do. Not all UC...
Discussion, Questions, Challenges
The New EduDotCom 2013 19
Thanks for your interest
Ellen D. Wagner
Executive Director, WCET
Text/phone +1.415.613.2690
Email edwsonoma@gmail.com
Twi...
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The new edudotcom.final

  1. 1. THE NEW EDUDOTCOM: BOOM, BUBBLE OR BUST? Ellen Wagner Western Interstate Commission for Higher Education Cooperative for Educational Technologies (WCET)
  2. 2. Session Description • Excitement around innovations in collaboration technologies that promote learning and engagement is inspiring educators, researchers, venture capitalists, and product managers alike. • Commercial interests are salivating at the prospect of all the MOOCs, flipped classrooms, and online programs that will require collaboration tech – recognizing that education and training may be ready for its “Internet moment.” • This session takes a look at the emerging market opportunities through the eyes of your customers, and offers suggestions for capitalizing on opportunities. The New EduDotCom 2013 2
  3. 3. Why We Care US edu. expenditures: $1.4 Trillion Global edu. Expenditures: $4.1 Trillion Michael Moe, April 16, 2013, ASU/GSV Education Innovation Summit The New EduDotCom 2013 3
  4. 4. Education’s Internet Moment • Investments in education-technology companies nationwide tripled in the last decade, shooting up to $429- million in 2011 from $146-million in 2002, according to the Na-tional Venture Capital Association. • In 2009 alone, venture capitalists pushed $150-million more into educational technology firms than they did in the previous year, even as the economy sank into recession. http://chronicle.com/article/A-Boom-Time-for- Education/131229/ The New EduDotCom 2013 4
  5. 5. Today's investors believe this round of .edu growth is different from the last dot.com. Michael Moe, GSV Asset Management, has noted said the first ed-tech wave had been based mostly on euphoria: "There were just a bunch of things that were, candidly, thrown against the wall," he said of the 90s start-ups. “Some companies pitched ideas that had no sustainable business model. Others were years ahead of their time. When the dot-com bubble burst, investors fled the market.” http://chronicle.com/article/A-Boom-Time-for-Education/131229/ The New EduDotCom 2013 5
  6. 6. Wait – did someone say “Bubble”? • Government subsidized debt, also known as financial aid, fuels much of higher ed growth. • Average family borrows $60K: $35K by parents, $25K by students • In 2010, student loan debt surpassed credit card debt in the US. • There are rumblings among financial organizations tracking the market segment suggesting that higher ed may be “cruising for a bruising” similar to real estate in 2008 and technology in 2000. The New EduDotCom 2013 6
  7. 7. The “Bubble” Phenomenon • A financial bubble is defined by values that are inflated beyond what the market will bear, or when justified against historical or projected data.  The tech bubble exploded when company valuations went crazy with no revenues to back them up.  The housing market prices moved beyond what people could reasonable afford even as banks pushed money into people’s hands. • In higher education, many measures continue to indicate that investments in higher education pay off….for the people assuming the debt, that is. • What about for companies providing goods and services to institutions whose stakeholders are starting to feel the pinch? The New EduDotCom 2013 7
  8. 8. FOUR ASSUMPTIONS ABOUT THE HIGHER ED MARKET (Mrig, 2013) The New EduDotCom 2013 8
  9. 9. Demand for Higher Education is Inelastic (Inelasticity - The situation in which the supply and demand for a good are unaffected when the price of that good or service changes.) The New EduDotCom 2013 9
  10. 10. New Sources of Revenue are Always Available • Public Funds • Endowments and annual giving • Tuition • Enrollment Management • Grants and Contracts The New EduDotCom 2013 10
  11. 11. Higher Education is always consumed the same way Traditional • On campus, in the classroom • Semester/quarter based • Course credit based on contact (1 credit hour = 15 hours in class) Nontraditional • Online courses (cohort) • Online courses (personalized) • MOOCs • DIY • Competency based learning • Mobile learning • Badge systems • Games The New EduDotCom 2013 11
  12. 12. …(pay no attention to all that “Free” education out there...) The New EduDotCom 2013 12
  13. 13. The Public’s Faith in Higher Ed is unwavering http://www.technologyre view.com/featuredstory/ 429376/the-crisis-in- higher-education/ http://www.a mazon.com/T he-Quiet- Crisis- Education- Failing/dp/18 82982703 The New EduDotCom 2013 13
  14. 14. The New EduDotCom 2013 14
  15. 15. MAXIMIZING YOUR PROBABILITIES FOR SUCCESS The New EduDotCom 2013 15
  16. 16. The biggest reason this boom might not be as different as you think “…It’s because no matter how new your tech, or how great the idea, or impressive the possibilities, we won’t crack the code on transformation until we change the most important part of the equation. And that is the human factor.” http://elearningroadtrip.typepad.com/elearning_roadtrip/201 2/03/why-this-edudotcom-isnt-as-different-as-you-may- think The New EduDotCom 2013 16
  17. 17. It’s not about the TAM • Don’t focus on the TAM (Total Available Market). Focus on your TSM (Total Serviceable Market) – the slice of that very large funding picture that deals specifically deals with UCC technologies • Up to 87% of annual IT infrastructure budgets are allocated before the financial year’s end (Campus Computing Project) • Sales cycles for large IT purchases can take up to 18-22 months for approval The New EduDotCom 2013 17
  18. 18. Think Like an “Educatian” • Educators care about mission, not about markets. • Listen for what THEY want to do. Not all UCC opportunities look like a course. Or a MOOC. • Find the influencers. Help them help you. • Find ways to make your customers successful post-sale. • Showcase their work. They will present all the great stuff they are doing with your platforms at their professional meetings and conferences. • If your customers are happy, they will be your best advocates. They will tell their friends. They will tell the press. They will tell their legislators. • If they are unhappy they will tell their friends and colleagues even more. The New EduDotCom 2013 18
  19. 19. Discussion, Questions, Challenges The New EduDotCom 2013 19
  20. 20. Thanks for your interest Ellen D. Wagner Executive Director, WCET Text/phone +1.415.613.2690 Email edwsonoma@gmail.com Twitter @edwsonoma Web: http://wcet.wiche.edu The New EduDotCom 2013 20
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