by Stephen Downes
April 2, 2014
Why VCs Usually Get Ed Tech Wrong
April 2, 2014
Michael Feldsetin writes, "The combination of the obsession with disruption and the phobia of institutions is a particularly bad one for the education markets... it leads to consistently unprofitable investment decisions." It leads to direct-to-consumer strategies, he argues, hence avoiding institutional and educational system complexities. "But in education, complexity is unavoidable, which means strategies that attempt to avoid it usually result in risk-increasing ignorance rather than risk-avoiding safety." Good post, mostly correct, and includes an also-recommended link to Rethink Education’s Matt Greenfield. I have just one caveat. My observation is that VCs invest in people, not products. So in the case of education, it's not the case they are investing in the wrong ideas, but rather, they are investing in the wrong people. What people? Well (and here is where Feldstein is right) exactly those people who eschew complexity and recite what are now mantras about disruptive innovation and (yes) "some Ayn Randian fantasy where technology unleashes the power of the individual."
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