Category Archives: startup

How To Get Your #EdTech Business Off The Ground And Keep It There

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I’ve worked in education technology (#EdTech) for many years now and over the last five years I’ve co-founded and run a successful company (Airhead Education) delivering a web desktop to schools (Airhead). We won a Bett award for ‘Innovation in ICT’ in 2015 and achieved it without investment from any external source. We’re debt-free and we’ve made a profit in every year of operation. No, we’re not Google yet but we’re making our mark in the education sector and we continue to listen and grow. It’s certainly not been easy, but it has been a lot of fun and as we start 2017, I’ve been reflecting on a few of my lessons learned.

I’ve seen technology products and services designed for education come and go (and usually turn up again, reinvented). Often I’ve seen the merit in the idea but the execution has been poor. Occasionally, both the idea and the execution have appeared to be flawed. The thing is, I don’t have an issue with either scenario. Ideas don’t just spring into life fully formed; they need to be shaped in the fire of trial, error and reflection. And of course the same applies to the execution of ideas in the form of products and services. The process of releasing, reviewing and revising is a basic principle underpinning continuous improvement. And I’m not even perturbed if individuals without education experience try their hand at EdTech. Sometimes the education crowd can’t see the wood for the trees. But there’s one thing you must do: survive long enough to learn the lessons you need to learn in order to build a successful business.

So if you’re going to invest your time, energy and creativity in developing technology for the education sector, you should be sensitive to the characteristics of the technology and education markets and what they mean for your business. For me, there are three particular EdTech business challenges:

    1. Rapid lifecycles – The pace of change in technology is rapid and and the lifecycle of most technologies is therefore short. Whether it’s software, hardware or the services that support them, rapid evolution of technology means a requirement to make changes just to stay functional and relevant, let alone to evolve with your customers’ needs. Developing, delivering, maintaining and scaling products and services is a costly endeavour which requires unerring financial and technological vigilance.
    2. Tight budgets – The majority of educational establishments are under constant budgetary pressure and, rightly, there is a tension between competing requirements for investment. Educational establishments should not be taking excessive risks with the deployment of technology because they simply cannot afford to squander their budget. The consequence of this is an ever higher bar for the effectiveness of education technology vershe price paid.
    3. Risk Aversion – Education establishments are intrinsically risk averse for a variety of reasons. Limited budget is one of those reasons but so too is the price of failure beyond just money. Organisational failure in an educational establishment ultimately hits the learner and so an ‘if it ain’t broke don’t fix it’ culture often emerges to protect the learner from excessive educational experimentation, including with technology.

So let’s be clear about what this means for the prospective EdTech entrepreneur:

  1. Deep pockets – You’re going to need deep pockets in order to get your business off the ground and keep it running when technology is changing apace. You will need to factor in the cost of ongoing technological development because without it, you run the risk of becoming irrelevant just as you’re gaining traction in your market.
  2. Realistic assumptions – Take a long hard look at your business plan in terms of market size, adoption rate and price point. Make sure that enough customers will actually pay the price you need them to pay in order to survive. Be pessimistic and enjoy a nice surprise. There’s no point in creating something that users love but which they don’t value enough to buy.
  3. Solid evidence – Test your product or service in MVP form (Minimum Viable Product) from the beginning and never stop soliciting opinions and analytics about its performance in order to create an evidence base for the efficacy of your creation. Whilst you may think you know how to solve a relevant problem, ultimately your customers need to agree with you and be prepared to recommend you.

Yes, I’ve learned a lot of lessons in the course of co-founding Airhead Education and no doubt there are many more to come. The truth is that I love what I’m doing and so it’s easy to get up in the morning and consistently spend time working out how to make Airhead better. As long as I can say that, I have the most important ingredient for success. Good luck in 2017!

It’s all about the (validated) learning

This week I’m listening to The Lean Startup by Eric Ries. If you prefer visual consumption, check out Eric’s  presentation to Google. If you like listening to books (like me), check out the Audible version. Whatever your preferred medium for consumption, and whether or not you’re interested in starting a business, I recommend that you engage with his thinking a little if you’re interested in learning in the context of change.

I should also state my personal interest. I’m currently a one third partner in a startup that’s sailing into uncharted waters (Airhead Education). We have a great idea (built around the concept of a cloud desktop for schools), great people (check out our technical guru, Jason Dixon’s blog) and, I think, the zeitgeist is in our favour. But we’re trying to bring a new technology paradigm to schools and that means change. We know about 10% of what we need to know to even build a meaningful business plan! There’s 90% (probably a lot more) to learn.

Eric begins his book by defining a startup as “a human institution designed to create a new product or service under conditions of extreme uncertainty.” This emphasis on ‘uncertainty’ is important. If I was to start a traditional grocery shop, I’d be walking a well-trodden path. There’s loads of explicit learning which I can access in order to understand how to make it successful. Most management theory is focused on this type of business where the idea and the customers are well understood. The keys to success are effective planning and efficient execution. But what if your idea is disruptive and visionary and you have no idea how your ideas and products will be received by customers, or even who your customers are? Traditional management theory falls down.

This is where Eric steps in. His thrust is that a new type of management theory is required under conditions of extreme uncertainty (sounds like Quantum Management Theory to me). He’s also keen to point out that, although this is the sea where entrepreneurs swim, it’s also vital for there to be a similar management theory for intrapreneurs (those who behave like entrepreneurs but in the context of a mature businesses). In fact, mature businesses are often very poor at innovating because the negative impact of failure is magnified. Even minor failures can reflect badly on the brand. Mature businesses are usually conservative for this reason.

I’m not going to provide a complete synopsis of Eric’s book but I wanted to pull out a couple of key points. In conditions of extreme uncertainty, one thing is for sure: you need to learn and fast. But is all learning equal? Most entrepreneurs fail a lot before they find success. You’ll hear them say things like, “Well, it was tough but I learned a lot.” What was it that they learned and was it worth learning? Perhaps at a personal level it was, but at the level of business, Eric argues that what would’ve been much more useful and timely to their venture was validated learning.

build-measure-learn-loop__largeValidated learning is achieved using the scientific method. That is to say, you build a minimum viable product (MVP) or even just a mock up, set yourself a hypothesis to test, and then get out there and start testing it with customers immediately. Don’t wait until you have a great product. Don’t guess who your customers are and what they need. Build it. Measure it. Learn from it. Refine it. Go back around the loop. But faster this time (time and money are running out, remember?).

The problem with most entrepreneurs is that they’re passionately attached to their vision and find it hard to pivot (pivot = a strategic change of direction with one foot firmly planted in validated learning). The problem with engineers and designers is that they’re perfectionists and feel that they will be judged by the quality of their output. A minimum viable product is a scary idea for them. The problem with investors is that while you have zero revenue and a great idea, you’re exciting. As soon as you make a penny in revenue, the questions start coming: why so little? The clock is ticking.

So as sensible as validated learning is, it’s quite a tough management philosophy for participants in the startup to embrace. There’s actually quite a lot of momentum in a startup. The potential for agility, yes, but the appetite for it? Not so much. You may have to accept a potential pivot (major strategic change) for each cycle of the process. You will certainly be constantly tuning (tactical change) based on new data. You will also be asking your customers to accept (and pay for) something less than perfect. But how else can you systematically and meaningfully evolve your product unless it’s by validated learning? OK, you may be lucky and come up with the perfect formula first time. Unlikely. More than likely the market is changing almost as fast as your product. It’s a race!

This management theory is particularly challenging for mature companies who are good at planning and execution but for whom innovation has become an aspiration rather than a reality. The idea of putting a MVP in the hands of their valued customers is very scary. The idea of pivoting every other day (read ‘acknowledge failure and learn from it’) is even more scary. But this is what learning looks like. Hard graft and lots of mistakes. Why would it be different for a big company than a startup?

Personally I think there are important lessons in here for organisational change as well as entrepreneurs and intrapreneurs. As was pointed out to me the other day, I talk a good game in terms of advocacy for educational change, but what about the ‘how’? The problem is, I think, that many education leaders (like entrepreneurs) become victims of a grand plan when in fact what they need is constant evolutionary change based on validated learning. I call this the paradox of incremental transformation. What is called for in schools is not one grand plan. In fact the grand plan creates an unhelpful momentum of its own. It is not about unleashing massive transformation but rather a constant series of micro-experiments to test hypotheses that form the granularity of the plan and could change the plan. The key is to become agile at validated learning. Perhaps it’s important to point out at this point that learners need to be participants in their learning. This is the reason why change imposed from above (or externally) is often met with resistance.

To achieve evolutionary growth as an organisation, leaders need to build a culture of support for  experimentation, failure, and in particular, advocacy for measurement and reliance on data to validate results. They need to be willing to react to validated learning quickly and implement change when it is proven to make a difference, even if the results are contrary to their expectations or wishes. The cycle of build, measure and learn is every bit as important to a school as to a startup.