The Future of Education (private feed for michael.b.horn@gmail.com)

Brittany Miller and Jasmine Walker of the Southern Education Foundation's (SEF) outcomes-based contracting initiative joined me to discuss how this innovative approach, which ties financial payments to educational outcomes, is shaping the future of education funding and accountability. We dive into how outcome-based contracts works across different types of educational services, what sets SEF’s work apart, and why now is an opportune time for districts to get on board.Paying vendors based on student outcomes has long been one of my big pushes to school districts. It’s among the reasons I get excited by folks like Joel Rose and Teach to One who say they’d be thrilled to be paid based on outcomes. But so many superintendents have always asked me back: how can we actually do this? Brittany and Jasmine give some great answers—and helped me understand why past efforts in outcome-based contracts haven’t worked.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber. Michael Horn:Welcome to the Future of Education, where we are dedicated to building a world in which all individuals can build their passions, fulfill their potential, and live a life of purpose. To help us think through this today… I'm excited about this topic because I feel like as far back as 2009 or 2010, after Disrupting Class had come out, I would be on the stump talking with district superintendents and the like, thinking about the importance of mastery-based learning, outcomes and stuff like that. I'd say, well, why don't you sign your vendors to outcome-based contracts? They would all look at me like how would we do that? And I didn't know the answer. So to help us think through that today, I'm tremendously excited because we have two individuals who are doing that on a daily basis. We have Brittany Miller. She's the director of the Southern Education Foundation's Outcomes-Based Contracting Initiative, so literally called the name that we want to talk about.And we have Jasmine Walker, who is the Senior Manager for the Outcomes-Based Contract Initiative work, and she's done this in Duval County, Florida, as well, which we'll hear about. So, Brittany and Jasmine, thank you so much for being here. It's great to see you both. Brittany Miller:Yeah, thank you for having us. We're excited to chat.Brittany and Jasmine’s Journey to the WorkMichael Horn:You bet. I'm excited to learn, so let's dig in with that. Before we get into some of the nitty gritty, Brittany, why don't I start with you? Tell us about how you got into this work. I understand that you put some of this into action in a previous position in Denver before you joined the Southern Education Foundation. I'd love to hear about your journey into this work.Brittany Miller:Absolutely. Prior to joining the Outcomes-Based Contracting Initiative on staff, I was a district leader participating in our cohorts, which is the way that we primarily teach outcomes-based contracting to districts. In that pilot cohort, Jasmine was my counterpart in Duval doing the same work that I was doing in Denver in that original cohort. What we were doing is we had just found out about all of the Esser financing that we were going to be getting for the district to support student learning recovery. I had just launched a new department, the Expanded Academic Learning department. With that, we had several initiatives that were focused on student learning recovery outside the traditional core instruction. One of those was high-impact tutoring. We had been involved in the feasibility work that happened out of Harvard University originally. I let out our first outcomes-based contracts for mathematics for our students in grades 4 - 12 with a virtual tutoring vendor, where I think it ended up being about 50% of the contract was contingent on meeting agreed upon student outcomes. So I learned a lot about how to reframe that conversation with a provider to focus on what I know best as a district leader, which with an instructional background is not contracting. What I know best is student learning. When you bring that to the forefront of the contract and you focus on what you want to be true for students, it just shifts that relationship between provider and district. Even down to the school level so that we can all be accountable to the same thing and be really clear about that. So then I was hooked and continued to apply OBC principles to my work in DPS until I ended up coming over and. And had the pleasure of coaching Jasmine through her first semester of implementation of OBC. And now here we are.Michael Horn:Wow. So, Jasmine, I want to hear your story into this as well.  Like Brittany just said, I understand you had done some of this work in Duvall County and it was also around tutoring. Also around mathematics, I believe. So tell us about your journey into this.Jasmine Walker:Yes. So I was first introduced to outcomes based contracting by my superintendent and deputy superintendent. They had heard about the work that was being done through the pilot, and due to COVID and all the things that took place there, we kind of delayed. We ended up joining that first cohort of districts that were learning about outcomes based contracting and how to use it as a lever within our districts. Specifically around those Esser funds and how we can use it for high-impact tutoring. During that time, I was the K-12 math director in Duval County. As I reviewed our data, we had a critical concern about how our students in middle school were performing in mathematics, specifically, those students that were enrolled in 8th-grade mathematics. Typically in our district, what would happen is students that were enrolled in 8th-grade mathematics, were actually students who were performing below grade level, because students who were performing at or above grade level, were in accelerated classrooms. As 8th graders, they would enter Algebra 1, where students that were enrolled in pre-algebra, as an 8th grader, their start, and access to Algebra 1 was being delayed. Some made it into Algebra 1 in 9th grade.Others weren't accessing Algebra 1 until 10th grade. And we all know that Algebra 1 is that gatekeeper course. If you can't get through it, it lessens the opportunity for other areas of mathematics, other coursework, like science, and then, as we look at students later on in life, what they have access to. What we wanted to do with our outcomes-based contract was change what was happening for our students in Duval County. Also have strategic use of the dollars that we were using through Esser so that we were tying our funds to student achievement.The Nuts and Bolts of Outcomes-Based ContractingThe Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Michael Horn:Super interesting, because we know the use of ESSER funds has become a bit of a flash button issue across the country in terms of were they really aligned to outcomes, and there you put it into the contract. So I'd love to dig into what these arrangements look like that you're putting in place. Brittany, you mentioned that 50%, I think, of the agreement was contingent on outcomes, but just talk to us about what these agreements look like. Brittany, why don't you go first, and then, Jasmine, on this one, you can supplement the answer.Brittany Miller:Yeah, so the way that we set up the arrangements as district leaders and then how we coach our districts that we work with now on this is, to start with what matters most to the student population that you want to serve. Everything is literally grounded in that initial concept. We do all of that before we open up what we call a rate card calculator, which is the dynamic pricing tool we have that helps districts price the outcomes. Essentially, once the district has decided on the student population and the outcomes that they believe students can achieve by participating in the intervention, then we coach them through putting together a rate card, which articulates to the provider how much money will be available as a base payment for services delivered, more like your traditional contract that you would have. And then the other portion of payment, we recommend at least 40%. A lot of our districts have been pushing that further to be contingent on agreed upon student outcomes. And so those payments are not delivered until after student data is available and you see whether or not students submit the outcomes. So that's, like, at a very base level, what it looks like. But there's a lot of different elements of both technical and adaptive work that goes into making those decisions as a district and then negotiating that with a provider, either via RFP or contract renegotiation, all of which leads to this mutual accountability between the district provider and school to land on those student outcomes.Mutual Accountability and Continuous Improvement  Michael Horn:You've both actually mentioned this mutual student accountability several times at this point. Jasmine, I'd love to talk. Have you talk to us about this? Because on the surface, I think when I hear these contracts, I think, well, this is putting the vendor accountable. How are you structuring it so that the district and school and everyone has skin in the game as well in the same way?Jasmine Walker:So I wanted to add on to what Brittany said and then go a little bit deeper into accountability. So one of the things that is different, like the big shift in mindset when it comes to outcomes based contracting that districts are having to make, is that they are paying for outcomes and not services. The district is driving the price because they're saying, this is what we're willing to pay for these outcomes. So that is a big shift, even for myself as a former district leader from traditional contractors. I just wanted to share that. And something that we always tell districts is this is like our slogan, if you will. We say, we buy outcomes, not services. And that's how we begin to shift toward that agreement of mutual accountability, because what we want is both parties to have skin in the game.So when we talk about mutual accountability, especially if we're doing like an RFP or bid documents, the district lays out what are things that they need from the provider in order to ensure that we're working towards meeting student outcomes. But in the same token, these are the things that the district is going to do in order to ensure that the conditions that are needed for the provider to be successful happen. Also in the RFP, the provider can say, hey, these are some additional things that we're going to need from the district to ensure that we can do what we need to do for our services or our products to work. So that's something that is very clear, that's laid out in an RFP and in a contract, so that the contract becomes more sticky, if you will, because you're clarifying what both parties are responsible for. So in the past, district took on all the risks they paid regardless of whether any outcomes were achieved. Now that responsibility is being shared. At the end, hopefully win win situation, students achieve the outcomes providers incentivize for their innovation and the work that they put into ensuring that students achieve those outcomes.Michael Horn:So stay with that for a moment. Jasmine, if I can go to you one more on this, which is what happens then, if, say, the district doesn't fulfill their side of the bargain, what's the upside for the vendor or protection, if you will, for the vendor in that circumstance?Jasmine Walker:Michael, I'm glad you asked about that because there is something that's built into the contract to support that work as well, because we all know things happen. So there's language written into the contract that says if certain things don't happen, the district will be responsible for not only paying that base payment, but those contingent payments for the students that were involved as well. So, like, an example that I'll use is when we talk about high impact tutoring, in order for students to receive tutoring, they actually have to be at school, or if it's virtual, they have to actually get on the computer. A provider doesn't have control of that. Who does have some control of that is the school. So laying in some language that where a district says attendance will be at 80% and so that they have a metric that they have to meet in order to ensure, again, that they're providing the necessary conditions for the provider to do, to meet those expectations that were laid out in the contract, those outcomes. Additionally, something else that is built in and part of our, a part of OBC that we're very passionate about is continuous improvement. So although we have these mutual accountability mechanisms built into the contract, it's not like, oh, in one instance, this didn't happen.District pays the provider, you know, regardless, there's checkpoints along the way so that both parties are able to continuously improve on the implementation if something isn't going right, coming together, problem solving, so that we can end up where we want to be, which is achieving those student outcomes.Attributing Growth to Specific InterventionsMichael Horn:Super interesting. So, Brittany, let me turn to you on this one then, because I'm just sort of curious how you measure growth and attribute it to a specific vendor, because obviously, and maybe, Jasmine, part of your answer starts to get at this. But we know that, say, math learning, there's a lot of things impacting that child's achievement, not just the tutoring intervention. So how do you think about attributing gains or not gains, right. To a specific vendor and measuring that?Brittany Miller:Yeah, it's a question that comes up a lot. My short answer is, we're not there yet. We're still in the process of evaluating this work and figuring out from, like, a rigorous evaluation perspective to what degree is outcomes based contracting really shifting the outcomes for kids? More generally speaking, when it comes to the specific provider and district arrangement, we are not claiming that it's a one to one correlation that if said student receives x intervention, then it's completely attributed to the provider. Depends on the intervention. It also depends on what else is happening in that child's life. So some of the students are receiving really strong core instruction from a supportive teacher on a daily basis. We have other cases where, unfortunately, you know, there's long term subs in the mathematics classroom, since that's such a hard position to fill, especially when we're looking at secondary schools, in which case, you know, perhaps it is more attributed to the tutoring provider because they're getting the same tutor every day, which, you know, is in some cases the most consistent instruction that we're able to get that particular child.In either case, the focus is not to demonstrate any sort of causality between the two, but instead to get us focused on the thing that matters, which is student learning and use the research base for that particular product line to name what we think is possible for kids.And so in the high impact tutoring instance, we know that students can achieve significant growth if they participate in tutoring sessions a minimum of three times a week for a minimum of 30 minutes in a group size of no more than one to three.There's been plenty of research on this coming out of the national student support accelerator and other entities that we work really closely with to understand the research base and what's possible. And so then what we're coaching the district around is saying, what is our theory of action of what it would take to actually achieve the outcomes that we know are possible from the research base, and then align that theory into practice, by the way, that we set up the arrangement with the provider.And then what that does is it shifts behavior of the adults in the system to stay focused on what we know can happen for a child based on the research for that particular product line. And then from there, if the outcomes are achieved, yes, the provider gets paid, but what they're getting paid is what they would have been paid regardless of whether or not outcomes were achieved in a prior relationship.And so there is an upside that we build into the pricing scenario with our district so that they are rewarding the provider should all of the outcomes be met for taking that additional risk. But it's not, you know, a bonus payment of any kind because there's so much money contingent on the outcomes that it's actually part of the payment that they would usually provide to a service provider just for delivering services.And so anyways, there's a lot of research questions that we're still answering about this, but the biggest thing that we coach our districts around is like, what does the research base on this product line say? What's your baseline data say about your student population? And then how do you figure out what you believe is possible so that we all just get focused on the right thing, even if it's not perfect.The Response from Vendors Michael Horn:It's really interesting the way you're segmenting it, the research based on the product or service that we're talking about, and making sure that the payments or the expectations are in line with what that could deliver. It gets into my next question, and I'd love to have you both comment on it if you want. Brittany, why don't we start with you? But it's around. Are vendors willing to do this? And do you see different vendors willing to do this, say, in tutoring versus textbooks or digital curriculum? What's that conversation look like? Because obviously, it's a very big shift for the vendor, but in many ways, it shouldn't necessarily be a surprising one because I always say, like, in any market, the customer should always be right. Education is this weird one where somehow that has not always been followed. So, Brittany, why don't you share some of your experience with that? And then, Jasmine, I bet you have some stories, too. Brittany Miller:Yeah, absolutely. And to that point, I think that that's something that is, we are always coaching our districts around, and Jasmine and I had to be coached around as well, which is you're the buyer. It turns out you actually have the spending power as a district.And that is, it's different for us in K-12 education. I'm not entirely sure why, but it's a systems problem, right. It's not an individual district leader or an individual provider problem. It's the system overall. And so what we found is that because in so many cases, the buyer is an instructional leader. And like I started with, I didn't learn how to negotiate contracts when I was going to, you know, school for all of the years, learning about instructional methods and how to, like, help kids learn and how you measure that, right. What I did do is learn how to apply that through the outcomes based contracting work to a contracting process, which then gives me the buying power and the leverage that I actually understand in order to drive student outcomes. And so taking that world of, you know, the chief financial officer's side of the house and the chief academic officer side of the house and putting those together is new and different for our districts. And it has the power to really transform these agreements with a provider to make sure that we stay focused on student learning. When we think about other product lines, we are constantly doing feasibility work to see where other areas are that we can go into outcomes based contracting. This is very new to k twelve. And so all of our district leaders, when they first learn about this, they're like, I should be doing this with everything. Why haven't I been doing this with everything all along? Right? And our response to that is, we agree, but not yet. Like, let's figure it out step by step. Right? It's new to the marketplace and in more developed marketplaces, like the Ed tech intervention space that we're in now, we see that there's different nuances that we have to pay attention to.So when we're talking about high impact tutoring as a use case, we had 55 unique providers apply to the different rfps that were released over two cohorts. No RFP got less than ten responses. And all of the districts were able to successfully negotiate a contract and are either implementing services now or have renegotiated and continue to implement services either with the same provider or a different provider.Making OBC Work for EdTech Contracts So we have those proof points in place, and we really believe that because of the feasibility work we did and because we worked alongside both providers and districts to understand what arrangement would actually work for this, we've seen so much traction from the provider side where they're definitely willing to do this work. So we're in that same process now with Ed Tech, where we haven't had any rfps released yet, but our template is going out to our districts, I think today or tomorrow for the RFP based on all the work that we've done. And so we're working to develop that infrastructure alongside our districts and providers and make sure that what we're putting out really aligns with that research base. And edtech is a much more advanced and stable marketplace. And so it is different than when we were talking about high impact tutoring in these providers were in many cases growing pretty rapidly in the time of Essa.We're not talking about a time when districts are really shrinking their budget, specifically when they look at how many ed tech interventions they've put in place over the last several years and thinking more critically about how to really serve students effectively with those interventions. And so we have to think about things like, what's your data interoperability look like in your district? Like, will you be able to successfully share outcomes with your provider? And all of the different metrics that, you know would lead to those outcomes.What is your usage rate look like currently for that product? Like, what's realistic in terms of what to get to for usage rate if you were to shrink the student population and have a more focused intervention for that group of students.And so all of those different elements go into what makes it something that providers are willing to consider because of the intentionality around it and that shared risk. It's not that all the risk goes to the provider. It's a shared risk so that we can really nail down, like, how to arrive on student outcomes effectively.Michael Horn:Jasmine, what would you add?Jasmine Walker:I would add that I was definitely one of those district leaders that said, I'm going to do this for everything. But what I tell districts now, let's not treat outcomes based contracting like it's a silver bullet. Let's get clear about how we are using our procurement processes as a lever to support implementation of products and services for our students. When it comes to vendors responding, I was one of those districts. I was like, people are going to actually respond to this RFP. I got 16 responses. So there were vendors that were willing to get in, roll up their sleeves, and, you know, help us to move our students. So that wasn't an issue at all, as I think about the districts that we're working with now, now that we're in the edtech space.Brittany shared that, you know, we conducted a feasibility study. So the people that participated in that feasibility study was both districts and providers, small districts, larger districts, nonprofit providers versus for profit providers, charter school management organizations. So there were different groups of people that helped to inform network. In addition to that feasibility study, we also pulled together an edtech working group, and that group was made up of district leaders and providers to help inform  this mutual accountability piece that we talked about to inform what this pricing model was going to look like. Because, like Brittany shared, it's different from high impact tutoring. So we got a lot of folks involved, a lot of different stakeholders to help us to build out what this work was going to look like as we moved into this new area of innovation, like we shared, you know, we're educating districts about this form of contracting, but we're doing it for providers as well. So we just finished a provider series where we wrapped up talking about what outcomes based contracting looks like, specifically targeting our edtech providers so they can become knowledgeable about outcomes based contracting and how it applies to their context. In the fall, you do a little plug.In the fall, we'll be doing a fall, our annual fall convening where district leaders come from across the country to learn about outcomes based contracting and begin to think about how they can leverage it in their districts. Some of the folks are our alumni. They're returning folks that want to expand and deepen their work in their districts. And then others are just new. They heard about us. They want to learn more and they want to do it this year. We're also going to do. At the end of that, we're going to offer a provider summit.So we're going to engage with providers, both from the high impact tutoring world, from the edtech world, and maybe even our curriculum based professional learning world, so we can continue to spread the message and educate folks on both sides.Why OBC Is Working This Time Around Michael Horn:It's great. And the fact that you'd get 16 vendors off the top and then start to develop this ecosystem through these convenings and the like sounds incredible. Momentum. I'm just curious a little bit more about the why hasn't this happened before? And when I dug into this a little bit, it seemed like there were some efforts to try this back in the 1990s and stuff like that, and it didn't really work out, and I don't know the reasons why. So I wondered if you can sort of point to what's maybe different now than past attempts to try to put this in place. I'll let whoever, whichever one of you wants to take that can jump in.Jasmine Walker:I jump on the first, and then Brittany can follow up with it. But what I would say is the world is different. When we think about how fast, like, everything is starting to innovate, how AI is coming into play, how things are. When I think about the McDonald's that I just saw where there are no people, everything is automated. There's trucks, semi trucks driving down the road with no driver. So I think that this type of contracting is just the right time. I don't think we were quite ready for this level of contracting, maybe in the nineties, but the way that we're going, we're to innovating. We have to innovate when it comes to our buying practices as well. And I think OBC is one of those things.Brittany Miller:Yeah, I'll add on to that, Jasmine. I think there's a couple of things coming together at the nexus of this context. And then I'll also speak a little bit to, like, the things that we've learned that are making these arrangements successful. So when it comes to the context that we're living in, right. We have AI, we have declining budgets for school districts, we have a lot of boards of educations across the country saying, what happened with our esser funding? Was it actually tied to outcomes, as you named earlier, Michael? And so with all of those different factors coming into play together, outcomes based contracting has found a way to sit in the middle of that space for the districts that are participating so that they're really able to understand how we can leverage those different elements of the contract in order address all of those changes that are happening.And the reason that I believe that we're seeing so many districts signing on to do the ED tech intervention work is because they recognize that something's going to have to shift if they're actually going to make good use of technology in the classroom.It's no surprise that we have really low usability or usage rates for these ed tech interventions that we know can make a difference in a kid's life. But none of them are actually used the same way that they are in a randomized control trial.So we're thinking about that really carefully and because of the way that boards of education are asking for. What's your evidence that this is actually working for kids? Why are we spending x million of dollars on it? And the district's just having to shrink the budget like, this is a really practical application of those different factors coming together and for the edtech components of that, specifically, when it comes to all of the driverless vehicles and technology that Jasmine was speaking about, I think we have a real responsibility to make sure that as we go down these new frontiers, we stay focused on what matters in education, and that is student learning, period, the end. And so we don't just collect quantitative data. We also collect qualitative data and go and do empathy interviews with students in the districts that we support so that the provider and district can hear directly from kids about how this is impacting them.That creates that power and that relationship to stay focused on the student experience and student learning. And so when all of of this different innovation and rapid change is happening, we can ground in one thing, and that's something that we can all measure together and really understand how to get better and better at that as the world continues to change. So that's kind of the context piece. I can answer what our project does differently as well. Would that be helpful?Michael Horn:Yeah, I think let's do that. Yeah.The Southern Education Foundation Difference Brittany Miller:Okay, cool. And then, so for the outcomes based contracting project in particular and the work that we've been leading, I think that the difference from what I've seen in other pay for performance models, because we get folks that call us and say, hey, what do you think of this pay for performance model? Is really that the pay for performance in its most traditional sense early on, was really focused only on how to hold the person providing the services accountable and the real shift in the way that we do business and that we've worked with our technical assistance partner or third sector capital that's done this work in various social sector industries is to make sure that it's not just the provider that's accountable, but also the entity that's purchasing the service. And that is different from what I've seen in other models where it still leaves everything up to chance. Because even though it's in the best interest of the district to achieve those outcomes, if it's not something that you're contractually obligated to and payment is tied to, as Jasmine was explaining for the mutual accountability language in the contract, then it doesn't rise to the top of your list as a district leader. You're just too busy. So by tying it into the contract and into payment, putting it in front of your board, it's a lot easier for me as a district leader to say to all of the folks that I'm working with, we actually have to do this because if not, we're going to have to pay for outcomes that our kids aren't achieving. And that shifts the conversation and it shifts the way that we're able to work alongside the district and provider. What happens with funds that are spentMichael Horn:It's really interesting. There's two elements there that seem really important. One is the fact that you have those qualitative measures so that you're not getting too, I guess, narrowly focused on maybe one number or something like that, that could get manipulated or something like that. And then second, it sounds like that really thoughtful conversation about making sure that the district is accountable is so critical so that it becomes a priority for all parties. It's not just sort of like, well, we threw it over the fence to the vendor and somehow they'll do magic. I guess that gets into the last question I want to finish up on, which is the outcomes piece of this I think is the most exciting part. Right. If we're really able to align around moving the needle for students, that could be huge.The second piece of this is presumably the districts can now save resources where it's not working for a given student and then either redeploy those resources to something that is of higher value for that individual or save it for the next year so that they can help that child. I love you to talk us through when funds aren't spent, those contingency dollars that the boost for really being successful. What happens with those dollars and how are districts thinking about that piece? Because that was a question I would get a lot is like what happens to those extra dollars that maybe we had put aside if they were successful. What do we do with those now?Brittany Miller:Yeah, I can start. And then Jasmine, feel free to jump in. Yes. We've done a lot of work on the financing side of this, too, because that's the first thing that we've heard from CFOs. If I don't spend my title dollars, they're just going to go back to the government.So we actually have on our website, it's OVC dot southerneducation.org. We have a section that has a bunch of different tools in it. And under the resources section, there's one that's a federal funding faq. And it goes over what the allowability is for federal funding, like your entitlement funds that would typically be used for something like an outcomes based contract. Now that we're moving into a post Esser era. And what we found in doing some digging is that the language for federal stipulations doesn't actually say that you have to spend within that year. It can actually roll into the next year because all of our title dollars are actually on a three year spending timeframe. And so we go through the guidance for that and what that could look like in terms of being able to spend down those dollars in the future.Another thing that we've seen our districts doing is thinking through how they can braid funds with some of their general funds as well. And then those general funds are more flexible to roll over year over year. So that's another area of consideration. Honestly, we've heard a lot of concern about this. And to date, we haven't seen anybody actually have an issue with figuring out how to spend down the dollars later. But it is a fear that folks have. And so we have done some due diligence to try to address that, but it hasn't become an issue today. And I think what we have heard more is that it's not just the cost savings of not giving the money to not paying the provider for the outcome.The other cost saving that comes in is when the kid is actually successful, then they move out of the intervention. And so when you think about that at scale, then you don't have to continue to deliver the same level of intervention to students year over year because they're not actually moving.So one of our districts in Colorado Springs, in one of the schools, half the students no longer qualified for the intervention at the mid-year point.And so in that case, like the principal was like, can I have spots for my, you know, third graders? No, because my fourth and fifth graders have matriculated out of the program. They don't qualify anymore. What a wonderful problem to have. I'm sure we can figure out how to spend the dollars more effectively if that's the problem that we're trying to solve for. Michael Horn:Well, that, I mean, it's fascinating on a few levels because then you get to a more nuanced understanding of, you know, spending your resources on those who need it the most and being more strategic about that. But, Jasmine, last thoughts from you here.Jasmine Walker:So I was one, I had funds left over after my implementation, and what it actually empowered us to do was to expand our work with outcomes based contracting. So we launched a new contract for high impact tutoring the, the following school year, actually, this school year is running right now and using those dollars and added some more dollars to support our students. And we expanded the program actually to now cover 7th and 8th grade so we can kind of catch students a little bit earlier and support them so that we are ensuring that our students are getting that algebra readiness that they need for the future. But I wanted to add another note to that. Duval county actually is, has joined our cohort now for Ed Tech as well. So that work, not only did they continue to work with high impact tutoring, they're actually expanding into edtech as well. So, you know, the chief academic officer, she really saw the benefit of using outcomes based contracting as a lever with these dollars. Additionally, I just met with another district right before joining you for this caAnd something that, like, happened, we, they just, you know, took an assessment. Students just took an assessment so we can measure whether, you know, the outcome was achieved for this period of time. And they actually maxed out their outcome cap. And I was like, wow, what a celebration. You allocated, you know, this many funds to this particular outcome, and the students just exceeded, you know, what you expected. So, you know, that feels good to a district. Like, districts want to spend the money, but they want to spend it on the outcomes, like students actually achieving. Michael Horn:Well, we'll say amen to that. And just, Brittany, Jasmine, thank you so much for spearheading this work, not just in the districts you were serving, but now to a much larger cohort across the country and really appreciate the work you're doing.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber. Thank you for subscribing. Leave a comment or share this episode.

Mackenzie Price, the founder of Alpha, an innovative private school network in Texas, and 2hr Learning, an educational technology that has sprung from the curricular model at her schools, joined me for this latest conversation. In it, she explains how Alpha leveraged technology and redesigned traditional school structures to more effectively and efficiently teach core competencies. 2hr Learning is now packaging that model so its benefits can be realized by educators everywhere.We talked about how schools can use the time freed up to better support students in pursuing their passions and building life skills—something that homeschoolers, Summit Public Schools, and Acton Academy (just to name a few) have long known. But Alpha and 2hr Learning come at this question from a different angle—not just with its branding, but also with its acceptance of traditional measures like test scores. I learned a lot from the conversation, and I look forward to hearing your thoughts as well.Michael Horn:Welcome to the Future of Education. I'm Michael Horne, and you are at the show where we are dedicated to building a world in which all individuals can build their passions, fulfill their potential, and live a life of purpose. And to help us think about that today, I'm tremendously excited because I've been hearing, I think everywhere, reading everywhere about the school and then school network and now app and a whole bunch of things called alpha schools. And we have the co founder herself, Mackenzie Price, and we're going to get to hear all about it and get a picture of it firsthand. So, Mackenzie, thank you so much for joining me. I can't wait for this conversation.Mackenzie Price:Well, Michael, I'm so thrilled to be here. I was really excited when I got this invitation. Mackenzie’s Journey to Founding Alpha SchoolsMichael Horn:So I can't wait for us to have a great conversation about where the future of education is headed, because I think you're helping shape it. And so I want to hear more about that. So let's dive into it. What is Alpha schools? What's the story behind it?Mackenzie Price:Yeah, well, I will start at a little bit of the beginning, which is in 2014. I had some background in working on some education initiatives, but I don't think there's anything like being a mom to really bring those bear claws out and say, we need something better. So I have two daughters that are now 18 and 16 years old. But when it was time for them to go to school, we sent them down the street to our local public school. My husband and I are both products of public school education. So for us, that was kind of what we were going to do. But very quickly, I found myself getting frustrated with the lack of ability for much personalization or adaptation to happen for where my kids were. And I would say, after about two and a half years, my oldest daughter and I were having a conversation one day, and she said, mom, I don't want to go to school tomorrow.And I looked at her and I was like, what do you mean? You love school. And she looked at me and she goes, school is so boring. And I just had this light bulb moment of like, this is a kid who was one of those tailor made, goody two shoe good little girls who was, like, meant to go to school and love school. And in two and a half years, the system had kind of taken this kid and just wiped away that passion. And I'd been really involved in the school district that my kids were at. And I talked to administration. And they said, mackenzie, I understand your issues and your frustrations, but this is like trying to steer the Titanic, and it's just too hard. And that was my cue that we got to do something else.For me, it wasn't about going to private school over public. It was about, we need a new model of education. And I looked around and I didn't really see anything that was going to address the concerns I had. So I kind of said, I guess we need to start this ourselves. I found a couple other partners who were willing to go forge ahead with this. And we started in a house with 16 kids. And from the beginning, we used adaptive apps for doing learning so that kids could receive kind of a personalized, go at your own pace education. And then that was opening up the afternoon.And at that point, we focused on public speaking and entrepreneurship. Fast forward ten years, and we have alpha schools. We've got campuses in Austin, Texas, Brownsville, Texas. We've just announced that we're opening a campus in Miami, and then we're launching multiple other schools that are all based on the idea of what I call two hour learning, which is really the thought that, you know, parents, your kids don't need to spend 6 hours sitting in class in order to crush academics. They can learn very efficiently and to mastery in 2 hours. And of course, that opens up the question of, like, what do you spend the rest of the day doing? Because I can tell you one thing, Michael. Parents don't want their kids coming home after 2 hours. Right? They want more than that.And so what we've done is we've created an environment where kids get to spend the rest of the day focusing on life skill development. And it's been great. And I've got a senior in high school now. So when she finally found out she got into her first-choice college, she looked at me and said, okay, Mom, I can officially say thank you for putting me in your weird school, because it's paid off. You know, it's.Michael Horn:That's amazing. I love an entrepreneur solving their own problem and by extension, so many other problems. I'm laughing as you're telling the story for two reasons. One, I feel like I'm living a mirror existence in some ways. I had written, obviously, about all this stuff for years, and then I thought, well, I'll, you know, I'll help turn my school district. We met with a similar set of answers, and, we found an existing school for my daughters. But it's so interesting to hear the coin of entrepreneurship there. I'm also laughing because during the pandemic, Diane Tavner and I have this Class Disrupted podcast, and we said, homeschool families have figured this out in two hours.What do you use the rest of the time for? And we had the exact same answer. She calls it habits of success. You call it life skills development. So I just love that we all sort of reach the same conclusion as you start to put this stuff into action. I'd love to hear a little bit more, because are you based in Austin, Texas? Like, there are Acton Academies that have similar philosophies? I think so. I'd love to hear more about why start something as opposed to maybe go to other existing options.Mackenzie Price:Yeah, we are based in Austin, and Acton Academy has been a really phenomenal model. Jeff and Laura Sandifur have been really true pioneers in the alt ed space. So they were very inspirational. And actually, when I was first looking around, their school was so full that, you know, there was no hope of getting in. They had a long waitlist, and we ended up working with a guide that had been trained out of Acton Academy for the school that we started. So a lot of similarities, and I think it's an interesting point you bring up, Michael, which is some of these ideas that we toss around, like the idea of personalized learning, the idea of, you know, kids being able to develop life skills. They're not crazy novels, you know, oh, my gosh, what is this? What are these people talking about? However, when we think about our education system, nothing has been done to address those concerns. Right? And we try these little, tiny, you know, take a bucket of water and try to empty the ocean, you know, solving problems, theories for this.But it's time for us to really change. And COVID was very helpful in helping wake people up to realize, gosh, the way my kid is spending their day in school is not all that great. And then, of course, the results we've seen post-COVID have been so atrocious. And, of course, instead of catching up, kids are falling further behind, which has been a great thing for understanding that there is so much room for disruption in education, and it's time for us to make that happen. So that's one of the things I focus a lot of my attention on, is getting parents to understand that they can and should expect a better and different experience than the one they had.Communicating Alpha School’s BenefitsThe Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Michael Horn:So tell me more about that, because that seems like COVID, as you said, was a catalyzing event for a lot of families and kids realizing we don't have to settle for this. We're seeing a lot more choices out there in the landscape, and yet we're also seeing families slip back sort of into the status quo and so forth. How are you catalyzing people to find alpha schools? How are you getting them excited about 2-hour learning and then all of the rich work that you can do with the rest of the time as your point is making, is that why you're opening so many schools, because the demand is just there or what does that look like as more people find out and you convince them you can do this?Mackenzie Price:Yeah, I think COVID provided an opportunity where again, parents got to to see inside what their school was doing and they often weren't happy about it. Then on top of it, there was so much politicization of whatever that is. There was a lot of politics that went with going back to school. And we were pretty fortunate because our school philosophy is very much, hey, we're here to do two things. We're here to teach your kid great academics and learn twice as fast in only 2 hours. We're here to teach life skills. And by the way, your kid's going to love school, which should be expected, right? I love talking to kids that I meet and I'll ask them, do you like school? And most of the time they say, not really. Or if they say, yeah, I like school, I'll say, what's, what do you like best about school? And you know, 95% of the time the answer is pe, lunch, recess, my friends.Michael Horn:Right.Mackenzie Price:And to me I'm like, that is such a bummer. We want kids to love the process of learning and becoming critical thinkers and gaining new skills and being challenged. And so what we tend to attract are parents who are also willing to be a little bit more innovative. And they're able to say, yeah, I think my kids should expect a different experience than what we all grew up doing. Right. And the experience we've had. And one of the things that's really interesting about what I love about our model, we don't test kids and admit them based on if they're doing a certain level, we'll take a kid wherever they're at because we know that by providing this AI tutor and adaptive learning, we can raise a kid. So we commit that within two years we'll have kids 90th percentile or above, which I wholeheartedly believe that by 8th grade every kid should be able to be 90th percentile or above in their core subjects.Unlike so many traditional school experiences where kids kind of get put in a trajectory, and it's like, oh, my kid's kind of an average student, and that's just what they're going to be. And so we get great results. But like in Brownsville, for example, our Brownsville campus, about half of our students come from families with median incomes of less than $40,000 a year. We have about two-thirds of our students are neurodivergent. Generally, a lot of those kids come in under the 25th percentile. For example, our second-grade math class in January 2023 was at the 31st percentile. One year later, on January 24, they were at 84th percentile. And that's the power of providing this one-to-one learning experience.We can raise the floor of what's possible for kids and explode the ceiling off of what's possible, so that those kids who are able to move at a quicker pace are, you know, the sky's the limit, right? And they do that all so much more efficiently and in less time that then we get to focus on the things that we as parents really want our kids to be able to have. Right? Developing empathy, learning how to communicate, you know, expanding those critical thinking skills. I think that's what we want for our future citizens.EdTech, AI, and the 2-Hour Learning ModelMichael Horn:Okay, so this is amazing because you basically, by having a mastery based, personalized approach, you're making sure kids hit those marks. And to your point, everyone can be successful. Unbelievable results. Talk to us about, what is that like? Where is that AI tutor from? What are the apps you're using? What does that two-hour block look like? And how are kids engaging in it?Mackenzie Price:Yeah, well, as far as the 2-hour learning program goes, it is a mix of a few things. We use some third-party adaptive apps that everyone's got access to. Alex, edit that one, please. We use a few different apps that people would know of things like Alex Khan Academy, Ixl, Grammarly, Newsela, you know, a lot of apps that are out there in the world. We've also created some of our own apps, particularly for our younger students, kindergarten, and first grade, where the math and reading apps haven't been quite as strong. And, one of the things we found in the last ten years is that not all apps are equal, and not all apps are equal in every subject, at every level.Michael Horn:Right?Mackenzie Price:And so part of what we've been able to figure out is at what stage in a kid's k through twelve educational journey is this app really good at teaching this particular subject? And then it's time to move to a different app, or this app works really well, for students who are learning this type of way, and then what we've done and where I'd say AI innovation has come from is we built an AI tutorial that guides kids through this process because unfortunately, edtech has not been that holy grail solution that everyone hoped it would be when it was introduced about ten years ago. You unfortunately can't hand a kid an iPad and, you know, an app and say, let me know when you graduated high school. Right? They'll do all kinds of things. They'll do everything from not even looking at the app to what we call anti-patterns. They'll topic shop, or as soon as something starts getting hard, they'll back out of it, right? Or they won't read the explanations when they get a question wrong. And so what our AI tutor has done is really guide kids to be able to learn how to efficiently use the apps. We also have up the mastery level so that kids are truly, truly doing that. And then we're using constant data in order to find out, like, is this kid taking too long to answer these questions? And if so, is it because they're struggling with this particular concept, or is there a hole from maybe previous, you know, knowledge that they need to get? The other beauty of AI is that what we're able to kind of combine is three things.The curriculum that we need to teach, the knowledge tree of that specific individual student, and their interests. So you might have a kid who is needing to learn fractions, and he's struggling, and he loves Dungeons and Dragons, and he can now roll a dice game to learn fractions with a Dungeons and Dragons theme, right? And so we're able to kind of cater the learning experience to a kid's interests. You know, we'll see this with some of our young readers. You know, if you're a first-grade student reading at an 8th-grade level, that doesn't necessarily mean you need to be reading 8th-grade content. These kids still want to be, you know, reading about butterflies and, you know, fairies. And so how do we up the Lexile level but keep the content the right way? And that's one of the places where AI has just done an incredible job for that. But the other key to this, and again, the reason that edtech hasn't been this, this magic solution is that it's only 10% of what creates a great learner. 90% of it, in my opinion, is you have to have a motivated student.Right? And that's part of the reason that when you're putting Ed tech in a classroom and said, hey, go spend 15 minutes a few times a week working on this app. You know, it doesn't really help. We're still dealing with the fundamental teacher in front of a classroom model where kids are all put in the same kind of pace. You have certainly heard that story a million times, and your audience has, too. But we got to find that motivational model that works. And for us, it's that time that opens up for the rest of the day to go do really fun activities. And we have schools, you know, alpha school was the first school that was started, and that school, we do general life skills workshops that are just really fun and exciting. But we're also launching schools.We have a sports academy that's launching this fall. Where would you guess it? Kids get to do athletics and PE and sports all afternoon. We have an esports academy for middle school students where we use esports and gaming to teach life skills. And then we also have a GT school that's launching this fall where kids will be doing more academically rigorous workshops in the afternoon as well. So you can imagine a world. And this is always a question I'll ask you, Michael. If you were able to do all of your academics in 2 hours a day, what would you have done with the rest of your day? Right. And that's always an interesting question.Ask adults, like, what would you have done with that time? And that's what I think we need to be building on in the future is, what are those core skills that we teach kids in order to be great critical thinkers? And then what opportunities does that open up for?Metrics for Mastery and the Role of AdultsMichael Horn:The rest of this is so cool. And I want to get more into that second block in a moment before we leave that first block, that 2 hours, one quick geek out question, then one slightly deeper one. I think the geek out question is, how do you measure mastery? Like, when you say they're, you know, 25th percentile, they grew to 84th percentile. What's the instrument you're using to measure?Mackenzie Price:Yeah, we're big fans of standardized testing, so we use map testing, and I think that's different from a lot of alternative models. It's so important to have data and understanding. And part of the reason standardized testing has gotten such a bad rap is that schools don't do anything with the results of their tests other than just get a report card. Right. But what you can do is when we take our map tests and we're able to say, okay, here are the many pages of information about what our student knows and what they don't know, and we plug that into our AI system, and then go fill those holes. That's where we can get mastery. And so, like at Alpha school this year, across the board, our kids are learning 2.6 times faster than the rest of the country according to map tests. Our top two-thirds are learning 3.6 times faster, and our top 20% are learning six and a half times faster.And that's part of the reason that I don't care if a student comes in and they're in the 10th percentile. I know I can get them up, you know, and they can. They can get to where they're above the 90th percentile, you know, in the period of a couple of years. This is truly, I think, what's going to be the great equalizer for education, and it's scalable. You know, one thing that I didn't mention, we don't have academic teachers. We have no teachers teaching. Our kids are fully learning via this AI tutor. Now, what we do have, and it is absolutely critical to our model, is we have adults in the building that we call guides, and their sole job is to provide motivational and emotional support to these students, to help them get connected with their why and get excited about what they're doing, help them overcome challenges when they reach them.And that's what a lot of the rest of the day is.Creating Coherence Across SubjectsMichael Horn:It's interesting because I think you do a great job as you explain this. Yes, the knowledge of a student, their background, and experiences that matter. So that sort of checks off the core knowledge camp of the world, if you will. Then you say, and the teacher doesn't have to be the sage on the stage. There's still the guide on the side. Right? So, we can have both of these philosophies in the same camp, if you will, as long as we do it in this mastery-based, personalized way that you've constructed. I guess that gets to the one other question. I'd love you just to sort of think through with me, which is one of the critiques I sometimes hear about.I don't know if I'd call it a playlist approach what you're doing, but sort of, you know, piecing together. Right. This app is best at teaching this. This one is teaching that we might lose connective tissue or coherence between the ways we teach history or social studies or science or things like that. How do you all get these things to sort of speak the same language, for lack of a better phrase, and create that coherence?Mackenzie Price:Well, one of the things that we do is, again, when we're asking kids to get to mastery level on each app, and we have them run through a couple of apps, right? So if they, if they do a first app and they're doing, you know, the math here, you know, 5th-grade math in one app, and then they go to another app and they're doing 5th-grade math, first of all, anything that they've mastered, they'll immediately test out of, right? And so we're understanding that they've got complete completion there, and then anything that they've missed, you know, they're able to learn back. One of the things that's really interesting, is we'll have students come in who are new to our school. You know, we had a, we had a girl who came in as an 8th grader, and she'd been a straight student at her old school, and her parents said she's a fabulous math student and she's great. And, you know, she should be ahead. And so we want her going into, you know, into algebra and 8th grade, you know, she should be a year ahead. And we said, well, we want to just help her understand, like, see where she's really at. And they're like, no, no, we know where she's at. She got straight a's in her last class, and she should be in algebra.And so we do something called a hundred for 100. And we'll say to kids, all right, here's what we're gonna do. You can get 100% on a Texas star test. We'll give you dollar 100, right? And these kids are like, whoa, a $100 is great. And we said, and here's what it is. You can pick whatever grade you want on the SAR test. And suddenly that kid who's like, I'm in 8th grade student was like, well, you know, can I take a 2nd grade test? It's like, well, not second grade. Let's go to fourth grade.And what's interesting is they'll go and they'll take that 4th grade test, and lo and behold, they won't have gotten 100% on it, right? And suddenly it helps the parents and the student go, oh, maybe I'm missing some, like, 4th grade concepts. But then we go and we fill in those holes, and that's done really quickly, right? It's easy to go, you know, to catch up pretty soon. Let's go to fifth grade, 6th grade, 7th grade, 8th grade, and you can get a really complete picture of what a student knows. And then when we're using these different apps and testing to understand what a kid has. Where we see this at the high school level is our students are still taking the AP curriculum that traditional high schools are offering. They're scoring well on those AP exams. They're getting, I think 94% of our students got fours or fives, which is pretty unheard of sats. You know, the average SAT score of our senior class this year is 1476, which is insane, because, again, you know, shocker of all shockers, when you learn a mastery, you actually, you know.Michael Horn:I was gonna say, it doesn't matter the modality so much at the point in which you're demonstrating it, you just demonstrate whatever's in front of you.Mackenzie Price:Exactly. And then, you know, our guides are able to jump in and work with the kids to start talking about the project-based side of workshops, which is where you really get that great experience. You know, I believe that, you know, again, you have to have k through eight. Common core knowledge is essential in order to be a critical thinker. But, you know, in today's world, it's no longer just about reading and writing and arithmetic. It's about the four c's, communication, creativity, collaboration, and critical thinking. And that's when our guides come around with our students, and they can make a lot of what they've learned really come alive through this life skill development. You know, an example of that with one of our high school students.He is great at physics, and he's learned all of his physics via apps, but he's also a nationally-ranked water skier, he and his guide sit down and they talk about how they can think about physics and use physics to improve his water skiing time. And that's the kind of magic that really comes alive for a student when they're. They're using their physics two knowledge, you know, to figure out how to get a, you know, a better angle on their. On their water ski time. Right. And. And that's when I think we develop a more holistic. You know, I hate using buzzwords like holistic, but it's. It's a great time for bringing all of that knowledge together.Following Passions and Developing GritMichael Horn:Well, and you build, transfer, obviously, from... We've just done it in the academic setting to a real-world setting, which almost never happens, as, you know, in schools. So let's dig into that second big, for lack of a phrase block where you're really doing those life skills. You're developing them through projects. What does that look like for the community, for an individual student, and for the guides?Mackenzie Price:Yeah. So the guide's job again… What I would say, you know, teachers in general when they get into the teaching industry, they do it so they can positively impact, you know, young people. They don't necessarily do it so that they can, you know, create lesson plans and grade homework. So our guides are really spending that time getting connected with kids to understand what they like and what they're excited about. And so I'll give you an example of that. We have a student who loves birds, you know, super into ornithology and loves bird watching. And so he has become an expert on that.He's built a second brain in order to know everything about birds. He's reached out to experts in the field. So he's learning communication skills. He's been able to interview some really amazing people. And one thing we find is that adults are always really excited to help ambitious kids, right? So this kid's eleven years old and he reaches out and says, hey, I'd love to have a conversation about some of the research you're doing based on what I've read. And, you know, the professor, you know, says, sure, I'd love to have that, that conversation. For our youngest kids in, you know, kindergarten, first grade, they're doing everything from learning to swim in the deep ends, you know, and getting that kind of a workshop to starting to code. Doing this, we have a great program where kids are doing self driving cars.So they're learning coding, they're doing it as a team and, you know, they're getting things. Another one that our second and third graders do, they do a Harvard business school simulation with a sneaker factory.How to do this. And I always love when these parents will call me and they'll say, it is so funny to see my eight year old come home from school and be like, I gotta figure out how to get my shipping costs down. You know, my profit margins are just not, not high enough. And I think I'm going to have to start using shipping containers instead of airplane freight. But then that's going to cause a problem with my time for inventory. And you're like, that's when an eight year old learning, you know, a Harvard business school simulation is so awesome. The other thing we do in these workshops is we have what we call a test to pass. So it's the idea of like if you're trying to teach a life skill, like, for example, grit, you know, this idea of sticking to something even when it's hard, you know, you don't just hand the kids the book by Angela Duckworth and say, read this book and write a report on it, and that will show you no grit.So what we do is we hold a triathlon, and at the end of the six week session, what the kids have to be able to do is they have to be able to solve a Rubik's cube. They have to be able to juggle three items for 30 seconds, and then they have to run a half mile. And what's interesting is at the beginning of this session, when we introduce this triathlon, you know, you'll have kids go, oh, I can't do x, y or z. I'm never going to be able to run a half mile or I'm not going to be able to do this. And so we teach them growth mindset, like the magical power of yet you may not be able to do it yet, but if you practice and learn how to learn and get back up and fail and all that stuff, then at the end of six weeks, when these kids are doing their triathlon and they're succeeding, that shows like, hey, these kids have grit, right? They've spent time becoming experts, learning how to learn, you know, again, doing all of those life skills. And so a lot of our guides time is spent implementing and working with these kids on these really fun workshops.Day in the Life at Alpha SchoolsMichael Horn:Wow. So help us break down in terms of, like, how much of that you know. So you've done your 2-hour learning. You're getting to dive into these projects of interest. How long do you do that daily? Do you see kids staying afterward because they're so excited that they want to keep going? Is this something that's more permeable than that? Like, what does that, what does it look like? It sounds like you might even have professionals coming into the environment to help create these projects and so forth. So that's pretty cool. Absolutely.Mackenzie Price:We do.Michael Horn:Yeah. Give us a story, a day in the life, if you will, of one kid doing this.Mackenzie Price:So, yeah, in the morning, our students come in and they do a limitless launch. It's kind of like think Tony Robbins for kids, where the group comes together and they're getting excited. They're planning their goals that they have for the day and how those align with their goals for the week and for the session. And then they go into their two hour learning block. We basically do it in kind of Pomodoro sessions of 25 minutes. They get breaks in between sometimes those breaks for our youngest learners, they might be do ten minutes of work and then you do a 32nd Taylor Swift dance party with your guide and get back into it and the guides, again, are able to work with these kids to help create these self driven learners. They're learning how to use the apps effectively. They're learning how to manage their time and their attention.They get to have lunch, and then in the afternoon is when we dive in all these workshops. So, you know, they're basically getting, you know, two and a half to 3 hours worth of workshop time each day. And then at the high school level, what this turns into is kids have the time to go work on what we call kind of an ambitious masterpiece project. So that could be anything from. We had a student who raised $350,000 and built a mountain bike park in Texas. He's done great job. We have a student who got really interested in cancer and epigenetics. She just released a documentary called Cancer Foodborne Illness on X.It's last I looked, has 4.2 million views, and she's been getting national press as a result of it. And this is what you think about. One of our fundamental beliefs is that kids are limitless, and they're constantly being underrated about what's possible for them to do. Kids can do incredible things when they're given the mentorship and, you know, the guidance and the time to go go work on that.So we see that with our high school students get to do really big projects. But, you know, even our middle school students.One of the checks that we have. We call it a check as part of a check chart, but they've got to be able to raise $10,000 in capital for a business. And we had, you know, a few students this past year who were able to raise money to create a self-help kind of mental health book that they used expert advice, but written for teen girls by teen girls. And, you know, these are the things that are exciting. K through eight, we don't have homework. And so what we do find, though, is a lot of times, kids want to work ahead of time, right? They want to do more, and they're excited about the things they're doing. Fundamentally, again, our first commitment is love of school. We survey our students to find out, do you love school, and would you rather go to school or go on vacation. And that second one isn't quite as high as the love of school, but it is really crazy high. I think it was, like 63% the last time we measured it. They would rather go to school than go on vacation.Cost of AttendingMichael Horn:Well, you've created an environment where they can be successful and they can have fun with friends while being successful. So it seems like you have the twin ingredients to motivation. There's just as we start to wrap up here, like, what's the tuition to go to a school like this? What does that look like?Mackenzie Price:Yeah. So we've been working on figuring out how we can best scale this and get this out to as many kids as possible. So we sort of started with the Tesla business model. Alpha school is sort of the very, very high end Rolls Royce version of private schools. Our tuition is about $40,000 a year. We have financial aid and about 75% of our students are on some sort of financial aid, but they are getting that super high end experience. The schools that we're rolling out this fall are going to be at about a $25,000 price point. And then we're working on getting some charter options. And if we can get charter access, of course that will become free for students.We're also launching a homeschool program and that's going to get a lower point. So, you know, our goal right now is, you know, we believe in the next five years we're going to be able to get our two hour learning academic program down to like $1,000 a year per kid, which would be amazing. It's not there yet. It's about $10,000 currently per year per student. However, what we're seeing, and two hour learning can also be implemented in other schools.You know, if someone wanted to start a school off two hour learning or convert, you know, to that, it can be done. There's a way to do that. You are, of course, fundamentally, though, transforming the model of the day, and you're also fundamentally transforming the role of the teacher.Transforming the Traditional High School ExperienceMichael Horn:So, Mackenzie, one of the questions I often get, or pushbacks, is, this sounds great. Maybe I'll do it for, I mean, it's why Montessori is pretty popular, you know, in early years, but gets less so as you go into high school is, gee, there's prom and sports and band and all these things that my kid sort of wants to be a part of. I get it. On the one hand, like, when I think about my high school experience, the classes were, eh. But I really love the spirit of being involved in all those other things. It sounds to me, though, like you're perhaps more than other schools positioned to tackle this because as you said, you can take that core and then have a sports focused school. You can have a music focused school. You could have, like, these different flavors, if you will, and tackle this.So I just love you to comment on that and tell you know, am I off base here? Am I miss reading, or how do. How do high school families, I mean, you're in Texas, after all, where this is sort of like, you know, this is a big part of the thinking for high school. How do they react to that and how are you all positioned to handle it?Mackenzie Price:Yeah, I think everyone has an idea of what they believe the school experience should be like, and often it's based on what their experience was like. And even the parts that they didn't like, they'll. They'll kind of say, well, I turned out okay. So, you know, what. What we did was good. And I remember when I first got ready to start the school back in 2014, I was doing a lot of reading, and one of the books I read was unschooling rules. And one of the things it said was, we get so used to, like, well, there's certain things that you just got to go through, the rite of passage that you have to go through.And I it helped me rethink about, like, well, is everything we do really, you know, you have to do it. So what I've figured out in the schools that we run now is, let's take the best of those things. So our school does have a prom, you know, but our school also gets to do these really crazy experiences that, you know, a lot of schools don't get, right. So we've added other things there for you. Take the idea of music. We don't have a marching band, but what we do have is kids who are really phenomenal musicians, who are able to go in and record their own album.And have the experience of getting to do that. We have one student who's a high school sophomore, and she is passionate about music and singing Broadway musicals. And when you ask her, what do you like to do? She's like, I love Broadway musicals. I like to listen to that. And she is building the first musical that she's trying to get on Broadway that is going to be entirely created and made by teens for teens. And so some of the experiences that she's getting and the mentorship that she's getting from people on Broadway and also negotiating contracts and dealing with attorneys, she's getting a lot of that social experience that we like. We also have a lot of kids who are athletes, who are, you know, able to go focus on their horseback riding or their swimming outside of school. I will absolutely say, though, if you want to be the quarterback on the local, you know, Texas football team, Alpha High School is not going to be the right school for you.Michael Horn:Right.Mackenzie Price:But if you want to be able to have, you know, a k through eight experience where you're not an over scheduled kid who's having to, you know, you know, go to school all day, then do homework and go to, go to the baseball practice and instead have afternoons to focus on athletics, you know, that's a great thing to get to do. So when I think about a lot of those traditional experiences that we believe kids should have, some of them, I would argue, are not worth as much weight as we think they really were. And some of them can be transformed into really amazing experiences that are, that our students have. So we find also, you know, socialization, this word socialization is something that always comes up and says, well, what about kids who they need socialization? And I look at it and I say, how much socialization is a kid really getting by, sitting in class all day, mostly being quiet? And again, I understand that there's a lot of classrooms and a lot of teachers who are trying to have more engagement in their classrooms. But still, the bottom line is you are sitting in class and there's, you know, 20 plus kids and one teacher, whereas these kids are having to, you know, work in teams and connect with people and, you know, they're having a lot more interaction with, with adults.Michael Horn:Right.Mackenzie Price:And other kids. That, I think, is where a lot of the really rich socialization comes from. So we find that, you know, very few of our students, you know, miss that traditional experience, with the exception of sports, is a big one.Michael Horn:Got it. Well, amen to so much of what you're doing. And I have this diagram now written on my notes, academics plus life skills. And then I have a big heart around it because of the love that you have built in your school communities among the students you serve. Mackenzie, thank you so much for being with us and for all of you following keep posted on the expansion of alpha schools two-hour learning. I am certainly hoping you all come to Massachusetts in the somewhat near future. Hint, hint.Mackenzie Price:We're working on it. Thank you so much for having me, Michael. It's been a pleasure. And I love getting to hear all of the topics that you present on your podcast on a regular basis.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber. Thank you for subscribing. Leave a comment or share this episode.

In partnership with the Navajo nation, Aspire Ability is getting tribe members plugged into opportunity. How are they doing it? Investments in digital infrastructure + innovative workforce solutions are a big part of the answer.I sat down with Aspire Ability’s CEO, John Mott, and head of policy, Moroni Benally to learn how the nonprofit is building access to good jobs through remote work. We discussed connecting necessary stakeholders across sectors, the importance of precise skills training, and the downstream benefits of employment. And we talked about how none of the moves they’ve made would have been possible except for a real bottoms-up approach that rooted them on the ground and in the community.Michael Horn:Welcome to the Future of Education, the show where we are dedicated to a world in which all individuals can build their passions, fulfill their potential, and live a life of purpose. To help us think through those qualities today and those aspirations… I'm tremendously excited for our two guests. One of whom I've known for several years, he's none other than Jon Mott, currently the founder and CEO of Aspire Ability. Jon, good to see you.Jon Mott:Good to see you. Thanks for having us.Michael Horn:Absolutely. And the other is a new friend, Moroni Benally. He is a community manager at Aspire Ability, living with the Navajo Nation and supporting the work of Aspire Ability there. We will talk more about that shortly. But Moroni, welcome. Thanks for joining us.Moroni Benally:Thank you, Michael.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Aspire Ability’s Founding Story and Approach to the WorkMichael Horn:Yeah, you bet. So let's get into it. Jon, start with you. Just give us the founding story behind Aspire Ability, your journey to founding it, and what you all do now there.Jon Mott:Yeah, I've been in higher ed and adult ed and corporate ed for my whole career across working at Brigham Young University, corporations like TD Ameritrade, and edtech companies like learning objects. About five years ago, having gone through all of these different versions of trying to help people get to better career paths, it just kind of struck me. My training and background is as a political scientist. So I've just been thinking about this as a systemic problem. You've got job seekers, employers, education providers, and they don't connect. So that was the whole purpose of Aspire Ability, to try to get better connections primarily between employers and education providers to make sure that educational programs actually aligned with jobs in the job market. We've been working on that in a variety of different ways over the last five years. And, over the last year and a half, two years, we've been focused on working on that problem in a specific community. If you try to change all of that for the whole world all at once, not gonna happen... But if you can work with a community where you can say, okay, in this case, it's with the Navajo Nation, saying, okay, we know who the employers are, we know there are two tribal colleges, we know who the job seekers are. Let's work on getting the jobs more clearly defined so that the schools can provide upscaling paths. Then we can message that to job seekers and get a better alignment between what are often disconnected points in a three-sided market.Michael Horn:Yeah, so let's stay with that. Jon, before we go to the Navajo Nation, and Moroni, before I bring you in, I'm just curious because that approach you just talked about sounds like what the sponsor of this series, the Charles Koch Foundation, and I know a big sponsor of yours, the Charles Koch Foundation, would talk about—this principle of bottoms-up, really solving the problem in a specific area rather than imagining a top-down, one-size-fits-all way about it. So just talk to us about what you've learned and what this work really looks like, engaging these three very different stakeholders in what's really a community talent marketplace.Jon Mott:Yeah, absolutely. There's been tremendous work done by lots of our colleagues and friends and people we know in this space to create taxonomies of jobs—what are the skills required for job A, job B? And that's really important foundational work in this space. But what we've discovered is, when you get to a specific job at a specific company, these taxonomies in the sky all of a sudden don't matter. It's like, okay, that's nice to know what a cybersecurity analyst is in general practice, but what about here at my financial services company? One of the keys has been getting to the last mile or the last hundred feet. What does it mean—what skills or proficiency level for those skills are required for this job at this company, maybe even on this team within that company? It's that hyper-localization of skills mapping that's become really critical. And then on the flip side of that, how do you help schools see that yes, there is a core foundation of skills for every job or career path, but then there are—you do need to provide some way to at least expose people to, okay, there's cybersecurity, but here's how it's different in fintech versus healthcare versus education, and really helping people make that last mile connection to a job.Michael Horn:Just to stay with you for one more moment on that. It sounds like you probably have to get pretty deep with the companies then, because they might not know the answer to that, I'm assuming.Jon Mott:100%. You know, we worked with a very, very large company that everybody would recognize the name. They had five postings for the same job at the same time on the same team that were all different. Because what happens? Hiring managers write the job postings, HR puts them up, they get interviewees to come in. But if the company itself can't agree on what the job is, it's pretty hard to tell the school, hey, here's what we need. So we do dig in deep, looking at the documentation for the job, but then talking to stakeholders, talking to incumbents, really helping the employer get aligned around, yes, we agree, this is what the set of knowledge, skills, and abilities are required for this job. And here's how we're going to measure those consistently every time.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Bringing the Navajo Nation and Aspire Ability TogetherMichael Horn:That's really interesting because the assessment piece of that is tricky. So Moroni, let me bring you in here, because I'd love to get deeper on, you know, let's do the case study, right? What does this work look like in the Navajo Nation and how did the work come about?Moroni Benally:Yeah, let's give some background on the Navajo Nation. There are about 175,000 members living on the reservation in Arizona, Mexico, and Utah, but about 400,000 across the country. On the reservation, there's about 50% unemployment and underemployment. We've seen numbers as low as 10% and numbers as high as 78%. And so that's the beginning of, part of the problems we're encountering is just sort of the lack of data. And so these are our best estimates that have gone around. Numerous federal constraints over land, which impedes development and access to housing, private sector, and healthcare. Every year, around 3,000 high school graduates leave the reservation needing jobs, but there aren't jobs. There aren't many jobs on the reservation. Not enough to keep up with what's needed. In addition, one of the other impediments is the lack of housing. So right now in the Navajo Nation, probably half of the people across the Navajo nation do not have a house of their own. Lots of multi-generational housing and so it's over overcrowded. In order to bring back a workforce up to at least this point, to get everyone housed, the Navajo nation needs to build about 35,000 houses just to meet what is currently the demand in the naval nation as of right now. There's a lot of these issues going around, unemployment.In addition, there are all these other problems that are associated with those in the lower socioeconomic class. A lot of their substance abuse and mental health problems. There's also problems with infrastructure, long distances, people don't have access to transportation. It's a lot of things going on.  So at the time, how we ended up in the Navajo Nation, I was a graduate student of Jon's at BYU a number of years ago. Yeah. Like Jon, I focused on public policy, finishing up my PhD at the University of Washington in Seattle in public policy.So sort of taking this broad public policy view of, like, what's happening in the Navajo Nation. I was working, as a policy worker for a tribal coalition around sexual assault, and domestic violence. I was working on behalf of tribes with the legislature, and federal government on policies around that. One of the issues with domestic violence that we had talked about was oftentimes a victim of domestic violence can't leave that situation, in part because they don't have a job. That there are financial constraints, and so they can't find a job. That's more pronounced in rural areas.At that point, Jon and I had talked about that, and we had approached one of the tribal colleges about using Aspire Ability's strategy plan platform application to address that need within that domestic violence community across the Navajo Nation. That was the beginning.Jon Mott:I'll just add. This was at the height of COVID. There are a lot of people who were victims of domestic violence, they were now at home all day with their abuser.Michael Horn:So they can't escape due to the lack of employment and lockdowns.Jon Mott:Right. So that's really where I reached out to Moroni and said, man, you know… because we've stayed in touch over the years and we've been thinking of ways that we could collaborate. There is a crisis right now. Is there something we can do here?Moroni Benally:Jon and I discussed the situation, and I relocated from Seattle back to the reservation in late 2020 or 2021. I was surprised to find broadband infrastructure had reached my remote area, allowing me to work from home. This prompted us to leverage the Navajo Nation's ARPA funds for broadband expansion, facilitating job creation and overcoming federal constraints. We collaborated closely with the Navajo Nation president's office to initiate these efforts.Jon and I talked a bit. I moved to Seattle to do some work, and I came home I think it was, November or December of 2020 or 2021, to the reservation from Seattle. My part of the reservation, that didn't have much infrastructure, was lit up with Internet broadband. I came home, and I thought, oh, my goodness, I can work from home. So I moved home from Seattle to the middle of the Navajo Nation and started working full time with Jon. At that point, we thought, well, Navajo Nation had all this ARPA money, billions of dollars. They had allocated some 500 million for broadband expansion across the Navajo Nation.And it came to the incredibly rural place that I live, and that's where we sort of…Jon  Mott:What is it you like to say? You're two hours away from a cheeseburger?Moroni Benally:Exactly. So at that point, we thought we could take advantage and leverage this to leapfrog over federal constraints and bring jobs with low capital costs. That was the idea, and that's where we began jumping in within the Navajo Nation. As a result, we've been working in coordination with the Navajo Nation president's office.We've been collaborating with the Navajo Nation Tribal Council. They're finalizing an appropriation package to support our efforts across the Navajo Nation.We partnered with tribal colleges, various communities, tribally owned enterprises, private sector companies, and high schools serving Navajo people. We've built a broad coalition and are cooperating with the Navajo Nation on their Navajo Nation Workforce Transformation Initiative. This aims to shift the Navajo Nation towards credential and skill-based hiring.Jon Mott:I'd like to quickly add that one of our key allies in this process has been Delegate Carl Slater, a member of the Navajo Council, who has championed our project. But one of the things that we heard loud and clear at the very beginning was, please don't be like all of those other organizations that come in and just try to get some of our money, do a 3 to 6-month project, claim victory, and leave. We knew and, as you know, Moroni and I are policy geeks. We knew that this was not going to be something that you could fix in half a year. Moroni and I planned this as a three to five-year project, and we're 16-18 months into it. if you think about the flywheel effect, you know, we've gotten the flywheel to start moving.You can imagine how new and just different this concept is for the employers, and the schools. To get them moving in this direction of thinking about skills-based hiring, and skills-based education. So a lot of the groundwork lane has been around some of those key concepts and ideas.This conversation is sponsored by:The Impact of Improved Digital InfrastructureMichael Horn:I want to reflect on a couple of points before I ask my question. Firstly, your focus on individuals in domestic abuse situations echoes a key finding in our research on why people pursue more education or switch jobs—it often involves escaping difficult circumstances. Secondly, Moroni, your approach to broadband infrastructure reminds me of Clay Christensen's concept of disruption through non-consumption. Essentially, you've created an enabling technology that leapfrogs traditional limitations. I'd like you to elaborate on this. Specifically, which companies are these individuals now able to work with? How does this improved infrastructure aid in escaping domestic abuse situations by reducing the need to travel? People might wonder what this looks like on the ground—how having a job can help someone in a difficult situation. I’ll let whichever one of you who want to take that jump in.Jon Mott:You want to go first.Moroni Benally:You may know a bit more about the first part of the question than me.Jon Mott:I mean, we won't get into all of the minutiae of what it's like to try to roll out a multi…Michael Horn:Yeah. Don't worry about the logistics.Jon Mott:Moroni is a prime example. He was not able to live on the reservation and work in the field that he was educated to work in and have the impact he’s having before there was broadband. Now he can do that. So if that's the germ of an idea or an opportunity, as broadband rolls out, what we're doing is we're saying, okay, what are the jobs that currently exist on the reservation that can be done hybrid or remotely? There are some of these jobs that have been chronically vacant just because for whatever reason, the employers can't find people who are qualified today for that job. So we're going to these, Moroni mentioned these tribal enterprises. There are businesses essentially, that are owned by the tribe. So there's a gaming and tourism enterprise. There's a tribal enterprise around housing. So we've gone to those entities and said, okay, what are the jobs? We talked about digging deep and mapping the jobs. We've done that. One, for example, is the Navajo Housing Authority which has hundreds of millions of dollars of housing money. They have had, I think it's 25 construction project manager jobs vacant for a couple of years. And, until those jobs are filled, they can't spend this money on housing. So we've mapped those jobs. Now, those jobs are probably hybrid jobs. Some days I could work at home, some days I'm going to, as a construction project manager, I'm going to have to be out and about. But it just unlocks the door to a new set of employees or potential employees for these jobs that didn't exist before.And I would also add, it also opens up the opportunity for remote education. So, yeah, I want to be a construction project manager. Not only could I potentially do that job remotely or in a hybrid way, but I can do my upskilling remotely as opposed to driving a couple hours each way every day.Michael Horn:Well, and that's really interesting because then that's also helping fill that demand, I imagine, for 35,000 more houses that you were mentioning as well.Jon Mott: And that's exactly why we focused on that job first because it did have kind of this potential domino effect.The Role of Employment in Addressing Domestic AbuseMichael Horn:There's a lot of research, like Efosa Jomo's work, emphasizing the importance of creating local jobs for community development. Moroni, let's dive into this. How does having a job or being on track to get one help with domestic challenges that someone may be locked in?Moroni Benally:Let's back up a bit with what Aspire Ability has proposed and worked on with the colleges, providing wraparound services like mental health support and childcare. Navajo Technical University offers these to staff and students. Part of our proposal is tapping into these resources for working individuals. When a person receives training and can work from home, they earn an income that enables them to break free financially from their abuser. What they call  financial abuse, I think, is they're able to break away because they're no longer reliant on that person. And they have then the capacity of other options to find other housing to live in. What that also does is that has an impact on crime. It enables the police officers to focus their attention on other things that need to happen. So there's all these down-the-stream consequences. One of the more significant economic consequences for the Navajo Nation is that for every dollar that is made in the Navajo Nation that a Navajo citizen like me makes. 30% stays on the Navajo Nation and 70% leaks off to these border towns. In part because of all of this underdevelopment and the constraints around it. One of the other downstream effects is that the person who was in that situation can leave that situation. But at the same time, 30% of her spending is now spent in the Navajo Nation, which contributes directly back to the Navajo Nation. That's one extra person spending an additional 30% of their income in the Navajo Nation. We've done some estimates about the potential impact of what 50 employees at $45,000 a year in the Navajo Nation would have.There are significant consequences and returns for the Navajo Nation in multiple way. But the downstream consequences of positive outcomes for leaving a domestic violence situation is it breaks that cycle of trauma for generations. The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.What Has Aspire Ability Learned in the ProcessMichael Horn:Super interesting. I'm curious about the economic implications. How do these initiatives contribute to addressing the housing demand you mentioned earlier?Jon Mott:One of the things that we started trying to wrap our hands around very early on was how many vacant jobs are there on the reservation? Because nobody knew. The kind of conventional wisdom was, well, the jobs that do exist are government jobs or public school or Indian health services jobs. That was largely the perspective. We couldn't go to Burning Glass or, you know, Monster because there wasn't a geographic job board for the reservation. We actually had to create one and do a census of what jobs exist. It turns out there are about nine, was our last count, about 3,500 jobs vacant on the reservation, and about half of them are private sector. That has kind of blown people's minds. They're like, oh, wow, we had no idea. So now we're able to look at the distribution of jobs across those and start helping create a strategic plan for the schools to say, oh, it looks like we need project managers, not just here, but across multiple industries. Let's start being strategic about deploying continuing ED and professional education resources. That's, that's one example we just wouldn't have known unless we dug in on that.Michael Horn:Moroni, you get the last word on what you've learned.Moroni Benally:Going off of what Jon talked about, despite my familiarity with the Navajo Nation, I was surprised by the lack of labor market data collection by Navajo government entities. Our job board has become the first informal data collection mechanism for labor data in the Navajo Nation. Another surprise was the slow tempo of decision-making within the government. Not that they're bad, it's just that they've lacked the training, they've lacked the direction. So as a result of that, it moves very, very, very slow. Then you mix in the local concept of time and their notion that, oh, if we miss this round, it'll come back again next year, so don't worry about it Jon Mott:The very problem we're talking about. Many of, what you call, mid-level management jobs in the Navajo government are vacant. So the people who do have jobs, one of the reasons things are slow is because they're doing 27 things at once.Michael Horn:Not a formula for success. That's a lot on someone.Moroni Benally:Yeah. So for me, I was surprised, even though I grew up here. I worked with Navajo Nation, in multiple roles, and I was a bureaucrat for many years and served in the president's cabinet. I was the head of the natural resources, so I thought I knew bureaucracy until I got to the private sector and tried to engage it on that side, which is a whole different ballgame for me.Michael Horn:Both of you, are just tremendous. Thanks for the work you're doing. I'm just struck by the vertical integration you've had to do into places you never would have guessed.  Just by being on the ground and starting to fill some of these essential parts of the picture, and what you've built. But Moroni, Jon, and Aspire Ability, thanks for the work you're doing in the Navajo Nation, and thanks for joining us on Future of Education.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber. Thank you for subscribing. Leave a comment or share this episode.

Sustainable, transformational, outstanding, and permissionless. Each year, the Center for Education Reform (CER) awards the Yass Prize to the school that best embodies these four characteristics. I sat down with CER’s Jeanne Allen (check out her Forza...for Education Substack) and Anthony Brock, the Founder and Head of School at this year’s winner, Valiant Cross Academy. We discussed Valiant Cross’s personalized, holistic, and career-focused approach; their plans for spreading the benefits of their model; and how the Yass Prize will help. I left with a lot of new insights from this conversation—and hope you do as well.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Michael Horn:Welcome to the Future of Education, where we are dedicated to building a world in which all individuals can build their passions, fulfill their potential and live a life of purpose. Today we get to talk to two individuals who have put that work at the core of what they've been doing for years. I am tremendously excited about this. First up, we have my longtime friend. She's the founder and CEO of the Center for Education Reform. She's none other than Jeanne Allen.Of course, she has launched the Yass Prize for sustainable, transformational, outstanding, and permissionless education. We're going to hear a lot about that and more. But first, Jeanne, so good to have you here.Jeanne Allen:Thanks, Michael. Great to be here.Michael Horn:Absolutely. We also have Anthony Brock, who is the Co-founder and Executive Director of the Valiant Cross Academy, which sits in the heart of downtown Montgomery, Alabama. Anthony and I have already established that I owe him a visit at some point to those parts, but it's a private school with a Christian emphasis that serves males in the 6th through 12th grades. We're going to hear a lot more about it. But Anthony, notably, you all just won the Yass Prize, so welcome and congratulations.Anthony Brock:Absolutely. Thank you so much. Honored to be here. Honored to be the current winner of the Yass Prize. Very interested in the conversation. Thanks for having me.The Principles and Purpose of the Yass PrizeMichael Horn:You bet. I'm excited to have you here because if you win that prize, that means you're doing a lot. We're going to hear more about that, but Jeanne, let's start with you. Just thinking about the Yass Prize. I'm sure some of the listeners who tune into this podcast will know of it, but I'm sure some won't.We, of course, have had some past winners on the show. I'd love to hear from you why this prize is so important right now? These principles of the S.T.O.P. principles: sustainable, transformational, outstanding, and permissionless. Why are those so important and enduring right now?Jeanne Allen:Thank you, Michael. I'd like to say that we spent about 30 years at the Center for Education Reform building and demanding that we open up the opportunities for parents, students, and teachers to have access to better opportunities, and new ways of doing business. What we all realized very quickly, even though some of us knew it instinctually for a while, once we created that demand, and once that demand was also augmented and amplified by things like COVID-19, the supply wasn't big enough. We went on a hunt for some organizations that we thought would be temporarily supporting and showing the way for all sorts of other schools to deliver for students post that awful time in history. What we found is that there were thousands of organizations out there that had already been creating, not just during COVID but before, creating new and different opportunities that wanted and needed a way to not scale, but to be recognized for what they were doing. They don't go to those conferences and seminars that everybody else goes to. They don't have time. They're doing the work.Michael Horn :They're actually doing the work.Jeanne Allen:Yeah, they're doing the work. They don't read what we read because we're all so myopic. It's all we do. We found out that they needed encouragement, they needed a support network. Obviously, money is a huge driver, but what they want is also this information and the movement that came when we began to put them together. The Yass Prize is now not just on the hunt for a handful, but we seek to find, reward, and celebrate education providers of every sector, regardless of profit motive or whatever, that STOP for education.Valiant Cross’ Road to the YassMichael Horn:That's super helpful. Putting it in the context of the supply-demand imbalance in the country, I think is important because people tend not to think about the supply side of this very much. I think you're right. Anthony, I want to bring you into the conversation because I'm curious on your end, what led you…What steps led you to decide, hey, we're going to apply for this prize? This is something that could help us and elevate us.Anthony Brock:Yeah, well, one of the things recently, Michael, I've been talking to a lot of people here in Alabama about is you need to attempt to apply. Don't think that with the work you're doing, it's not worthy, because this time last year, I had no idea that we would even have the opportunity. Like she just said, we're busy doing the work and it felt good to be appreciated. I think I realized how enormous this prize was when I arrived in Cleveland, and I was a little shell-shocked when I walked in because I was just not used to it. I've been a public school educator since 1999. My brother and I started Valiant Cross in 20. Well, in 2014, we did a proof-of-concept year, and in 2015 we launched a school. I'm used to just the run-of-the-mill conferences that teachers go to. The same old, same old, and when I get here and I'm around all these new educational innovators across the country, my vision has been changed forever.Everybody talks about the 1 million, which is great. Please, believe me, that's great. We needed that. However, just the social capital that I've been able to build through being a part of this Yass prize, you can't put a number on it. We started Valiant Cross in 2015 and I would always encourage everybody to apply for this award. The Impact of the Prize for Valiant Cross and Those to Follow Michael Horn:Stay on that for a moment, because it's interesting to hear you say the social capital that you got from this. I imagine that means everything from the networks of people that can support the work, to getting ideas from other schools that are doing interesting things, to even perhaps being inspired to try out things that you never had considered. Like, what does that mean to you? What are the benefits of that social capital that you gain access to?Anthony Brock:Sure. I'm an artist by trade also so I'm a visionary. I'm an artist. I never even wanted to be a head of school. I just wanted to cultivate spaces where young people can thrive and learn. When I became a part of this cohort of Yass Prize finalists and semifinalists, it was full of just the most brilliant, innovative people you've ever seen before.When you think about permissionless, sad to say, I've been almost in a shell thinking, the work we're doing, we don't want too many people to see it. Because they may come in and say, hey, you can't do this. You can't do that. However, now I'm with a group of people who are saying, no, you need to do more. You can do more. Go forward with whatever that vision is that God has put before you, which for us is educating African American young men. We're in Montgomery, Alabama, the birthplace of the civil rights movement. We're right across from Doctor King's church, the only church he pastored. We’re right up the street from Rosa Parks bus stop. So why do we have to operate inside of a box when so much change came from Dexter Avenue, like the birthplace of the civil rights movement? So now it's, what more can we add to what we're doing with these young men? All our young men, we've had two graduating classes.They're all either at a four-year college or they're at a trade or vocational school. They're in the military. We have a few who've just joined the workforce right out of high school just through some of the offerings, which we can go into as much as you want. It's just exciting to be on this call and I want to say this, whatever it is that God put in your heart, it's a reason and a reason that he put it there. I'm so happy that I listened to that first call, which was to start school, and that second call, which was to apply for the Yass Prize as well.Michael Horn:It's powerful because Jeanne, we travel around the country speaking at all sorts of testimonies in capitals around the country and so forth. What Anthony just said is the truth. Which is that a lot of the most innovative schools have been taught to sort of duck and cover because they don't know when they're going to get shot for doing something that is outside the box that kids need but doesn't fit inside the narrow walls of what we've been told school looks like.  It sounds like maybe this prize starts to give them not just permission to do the educating, but permission to talk about it and inspire even more school leaders and school types, that you're going to build a legacy, almost a family tree, if you will. Anthony, out of this, how do you see that part of it, Jeanne?The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Jeanne Allen:Well, I will say that I think it's also done the same for advocates, researchers, and people who work in the field because they're able to put their heads up and expose what they're doing. They can share and build awareness about what they're doing, which I can say on Anthony's behalf and others, nobody thinks they're doing great things. I mean, it was extraordinary to talk to them during the process, look at their application, or ask questions. At one point in time during the process, as we're whittling down from quarterfinalists to semifinalists, we do interviews with everybody like this. I'd say, well, tell me more about why you're doing such breakout things. And they're like, am I doing amazing things? I mean, I've never met so many, as Anthony said, thoughtful, brilliant, open-minded people who wanted to be sponges. To be honest with you, I'm used to being around a bunch of people who think they know everything. I will also admit candidly that we get into that. I get into that, oh, I already know this is happening. I know it's happening in Alabama. I don't have to go to Alabama. Someone will tell me if I have to know something. Well, the fact of the matter is, when you see the work that organizations like Valiant Cross are doing. Or Melanin Village and Princeton. All around the country, or any number of the groups that are in the cohort that didn't make it in, that are still extraordinary. Then you see it and look at who they're helping, look at what's happening around them, and then you say, why is everyone ignoring them? So, we went to Valiant Cross. We do these road shows after our awards each year, and we did the announcement of the 24 Yass prize at Anthony's school in January.And the governor, who knows about them, had never been there, and she came that day. But why hadn't she been there? She's three blocks away. It's not her fault, necessarily. Maybe we didn't invite her. Maybe there was no reason. But then again, it is her fault, right? I love her, but let's be honest. I mean, I don't know enough to love her, but why wasn't she and her people right there across the street from Martin Luther King's church? I think to the extent that we're all thinking that someone's going to tell us something good is happening is now we're making it much more of a requirement that anyone in this work start looking at under places. Don't just show up at conferences and think you're going to meet everyone you're supposed to meet, because probably, likely the people, at those conferences aren't nearly as cool as the people doing the work.Anthony Brock:Yes. One thing we forgot to add also is right across the street is the Alabama Education Association, which is a very strong teacher union in the state of Alabama. They sit right across the street as well to add to the irony.Providing a Career-Connected EducationMichael Horn:We love irony here. We'll leave it at that, but let's get into the work itself and what the school looks like. Anthony, start to give us an understanding of what you've been doing that stands apart. And I guess I want to start at maybe a higher level before we get into this, what the day of the life of a student looks like. As I understand it, you all have been intentional about preparing students for the careers of tomorrow. That means computing, e-gaming, robotics, and more. What does that look like in action? How do you pick these careers? What's the role of partners in that? What does this part of it look like?Anthony Brock:Yeah, that's a great question. We are in meetings right now with my leadership team to even custom make that more. When you think about the permissionless part. We have decided to not only have career tracks that we have already, but we also have Cisco networking. Of course, we have dual enrollment with some local universities. We have barbering, we have welding. But now we are interested in putting all our 11th graders on track. The next step to that is to find out what each one of them wants to do by their 10th-grade year and custom-make everybody. The IEP in a traditional school is an individualized education plan, but we're going to try to have that.We will have that for each one of our young men going forward. If you want to be an attorney, if you want to be a police officer, whatever it is, we're going to custom-make that. That thought process would not have been my thought process right now if I had not seen so many other innovative models. We got to get them out of the classrooms that we've had them in up to this point from 7:30 to 3:15. So not only has the Yass Prize allowed us to take a step back and pat ourselves on the back for the work we're doing, but it's also made us say, hey, let's keep thinking. Let's keep pushing the mark a lot.The biggest part of Valiant Cross, which I always have to mention the importance of the fact that in Montgomery we have 200,000 residents, and we're averaging about 70 to 75 homicides a year. The most meaningful work we're doing is taking these African American boys and we're giving them hope. That's what we pride ourselves in telling them. Not just telling them but telling them and showing them that we love them, we're going to walk through whatever it is they want to do. If it's college, if it's a military, we want to see them to and through those areas as well. We've created a support system like none other for these young men. It's the amazing work that my staff does every day.The Valiant Cross ModelMichael Horn:There's so much there to love. The way you make these individuals feel that and show them that they matter and that their dreams count is powerful. I want to get into then, the actual educational model itself, because I understand you're doing a bunch of innovative things here. We know, Jeanne referenced COVID. We know that the readiness level of students is, frankly, all over the map at the moment as they come into these experiences. We also know that there's been renewed interest across the country in differentiating instruction, tutoring, and all the things.My understanding is that you all have been successful in that personalization. You called it customization just now in terms of incorporating tutoring and doing a bunch of stuff like that. I'd love you to just talk about what that model looks like. What does a student's experience look like, and what are tips for all the other schools that, frankly, have been struggling to get the tutoring piece right that they could learn from you?Anthony Brock:Yeah. Well, the most important thing is the adults that you have in the building. Being a private school, we have the opportunity to sit down with an adult and become a career counselor. Like Steve Perry always says, and say, hey, this is not the place for you. If you're not here for young people, it's not going to work. Basically, Michael, our teachers are staying after hours. They're coming early in the morning to tutor. We also partner with a local tutoring company here in Montgomery, and they provide tutoring through our young men throughout the day. We have a 15 to 1 or less ratio for all our young people in the school.The next step to that is we're going to be adding a teacher aide in each classroom to help with instruction as well. We just went through a round of applicants, and it's booming at the scenes. By the way, Miss Allen, it's like never before. We have so many young people who are trying to come to school, and it's because they want that individualized touch. Our teachers are going to basketball games, and this is basic stuff, right? But they're doing the basic things at a high level. We're going to basketball games after school with our young people. We're going to church with them. Last week, I got a call to take them to this new whitewater rafting place in Montgomery. I don't have to ask for permission to do any of that.When you build that relationship with these young people, a lot of them come with thick discipline files, they come with IEPs. A lot of them are behind two or three grade levels when they get there. So everybody's saying, how in the world are you guys doing this? When they come in and see all the young men working, it's about love and high expectations. That's the secret sauce of Valiant Cross Academy. It's about customizing what each one is going to do by their 11th-grade year. The connectivity is the most important part. If young people, especially African American males, feel the connected part that we give them at Valiant Cross, they seem to thrive. We've also created an African American male experience museum at our school.All of them, all the artwork and the pictures throughout the building, mimics them. There's culturally relevant teaching going on. We believe that if they have a strong sense of who they are in God and who they are personally, then they're going to succeed in life.Jeanne Allen:I also have to jump in, Michael, if it's okay to say something that you've often talked about. Even things that are basic can be innovative because they're not being done anymore or in the same way. Being able to think about each individual student every day and what they happen to need is important. When we were there, I'll just add one other thing I noticed, which I love about your educational model, Anthony. You guys were talking about in the hallways, we were walking and touring a couple of different kids and what was happening with them. These are things, again, great schools do this, but we prevent them from doing it by putting too many strings on them and not rewarding it. I walked into every class, and there was music, and the teacher had a headset, but there was different music in every class. And so finally, I had forgotten to ask him, and we saw him recently, and he said, there's data that shows that these students will let you tell them. It was fascinating how much people were paying attention and engaged, and the teacher was calling them out also, by the way.So, she's got the music. She got the headset. They're doing something, and there's a way that she gets them and pulls them out of what they're doing to reflect. Talk about that, Anthony.Anthony Brock:Yes. We do a two-week teacher training on that. The teacher is on stage at Valiant Cross. We don't have traditional desks, so you have to be in shape, first of all. But, yeah, they do have the headsets. They have the music. There are a lot of studies around musical education and what it activates in the brain for young people. We've customized playlists for each classroom.So, you're getting a different feel, a different vibe, even the way the classroom looks. I didn't go into, when you talk about innovation, Chuck Robbins, who is the national CEO for Cisco Networking. He spoke at our fundraiser last year and he came, and he gave us $500,000 for our programming credential networking program that we have at our high school as well. Every young man has the opportunity to do that. We've partnered with the Redtail Scholarship Foundation. We have about eight to ten of our young men right now. Some have already completed it, but we have about eight to ten in the cohort now working on their pilot's license. Only 2% of African American males are pilots.And again, we have the barbering credential. A lot of them leave every day to go to Trenum State Technical College to get different trades. Whether it's welding, we have one working on the CDL license. So, there is a lot of innovation going on, but to me, because of the passion that I have for it. My dad passed away in 2022. He was an educator, principal, and pastor as well. A lot of that is just naturally who we are. You want to see young people. If you want what's best for young people, there's nothing that you won't do for them.So that's why the Yass prize has helped as well because I'm someone who has an open ear. So, when I'm around, I'm a sponge. If it's a best practice that another member of the cohort is doing, I'm going to try to take it. I'm going to use it. I've been talking to Keith Brooks about working with Black and Latino males, and so we're looking at possibly, hopefully, partnering to bring that down here to Montgomery as well. I would love to start a center for urban education where you can come and learn some culturally relevant pedagogy.Michael Horn:Wow, that's powerful stuff. That music sounds amazing. And there was just, I saw research coming out around how actually, when we're also in music with each other, we start to synchronize and cooperate, and it's sort of something inside of us, innate, right. Where we want to work with each other, and it makes us more open to ideas and cooperation and building on each other.Anthony Brock:Sure. Absolutely. The other part is, that you have to look at the national suspension rates in different states for African American males is pretty high. So, we have an environment of culturally relevant restorative practices as well. We do circles. If they get in any type of trouble, which may just be talking at the wrong time, everything is structured, it's organized chaos in the building. I'll just say that because it may look like things are out of whack sometimes, but we do that to get them up and moving. We do not like to suspend anyone because that's what, oftentimes, young men are used to people giving up on them.I need you in the seat, and I need you learning. I need you engaged. A lot of that is what takes place on a daily basis. It takes an act of Congress to get suspended at Valiant Cross.The Valiant Cross DifferenceMichael Horn:Wow. One of the things that occurs to me, hearing you talk is you're a little bit like the fish that doesn't realize it's in water. Cause that's just the milieu in which you're swimming. And so, Jeanne, I love from your perspective, you look at the list of semifinalists and finalists for the Yas prize. They are incredibly inspirational. They're all amazing. What made the work that Anthony and his school doing stand out, from your perspective, what was it that, wow, yes. This is the one that's going to win this $1 million Yass prize.Jeanne Allen:After they went through all the judging and consistently came out on top for a variety of different reasons, commentary and scores, you just look and you go, sustainable. Talk about policy. They can operate because they're in a state where there is some, at that time, some small scholarship program. Now, a larger one that's been set up to help schools like that, help so students don't have to go beg. He doesn't have to go beg for funds from everybody, or at least less so transformational. All the things he just described. Outstanding. You talk about students in his area that are getting shot. They're coming from homes where you don't know what they had the night before or the week before or what they're going home to. Yet the education is outstanding across the board and permissionless. You just say the plight of black men in America and the fact that there's someone doing something about that, that wants to do more, learn more, go bigger places, do different things. The sky is your kind of limit. It really kind of all added up. We could say again that Anthony's amazing, Valiant Cross is amazing, and Valiant Cross is the winner. But there are a lot of organizations that fit, and there's something about people who go through the process, stick with the process, and make the argument that we're always shocked when they all come together.We're like, oh, my gosh. We had no idea they'd be like this. I mean, they get to the accelerator, Michael. What you participated in and they start, hey, can I get your number? That was interesting. I thought that. Wow, I didn't know you went through that. It is that social capital and that networking. We all take it for granted because we're in it every day. But they've made us better people and they've made us think differently and better about our jobs, our work, our goals, and our strategies. And frankly, more accountable because we want to make sure they succeed.Michael Horn:Wow. Anthony. My understanding is that winning this is going to allow you all to expand to even more men, black men in Montgomery. You're going to be able to add an elementary school, grades K-5. You're going to be able to start to expand to different states, I think. Talk to us about what this is going to enable you to do and what we can expect in the years ahead from expansion.Anthony Brock:Sure. The first thing was, again, the elementary school. We announced the same day that we announced the Yass application that we are opening up our new kindergarten. We're in the process now of finalizing a building which is also on the civil rights trail. We're trying to keep that same model going. That'll open up this fall. We're visiting Jackson, Mississippi, next month. That's one of the places that we're very interested in.I'm interested in other places, in Montgomery, I mean, in Alabama as well. I'm interested in Tuskegee, obviously, because of the work that Booker T. Washington did that was transformational back in 1800’s. The other part was, I spoke about possibly creating a center for urban education where we can recruit more black male teachers. Most black boys, they grow up from kindergarten through 12th grade, and they do not see anyone that looks like them. So just to have that person and that representation in the classroom will be huge. Also being a center where others can come train, you know, you may not be a black male teacher or black female.You may be a white teacher who wants to just come learn to train. How do I teach these young people that are in front of me? How can I relate to them? Those are a few of the things, a few of the areas that we're looking at and also, which I have not spoken to Miss Allen about. We are also launching a new literacy center here in Montgomery. We have started building out a new literacy center that will combat tutoring, I mean, mentoring, and the literacy rate over in West Montgomery, which is where a lot of these young people come from. That will allow us to impact way more young people, male and female, than just Valiant Cross Academy. A lot of exciting things, and I'm a full-time college student as well, but we're getting it all in.Michael Horn:Are you really?Anthony Brock:Yes. I'm working on my doctorate right now and I'm in my dissertation phase, so just keep me in your prayers.The Effects of State Policy Michael Horn:I will. I don't wish that process on anyone if I'm being totally honest. I'm just curious. So let's shift to policy because you both have brought it up now a couple of times, and I think this is a nice place to maybe wrap because as you know, Alabama's governor recently signed the Choose Act creating education savings accounts in Alabama. $7,000 per pupil starting in 2025. Jeanne, what do you anticipate this is going to do for innovation and education in the state of Alabama?Jeanne Allen:It's definitely going to encourage more people and more groups to expand, to offer students an opportunity. I wish it were bigger. I understand politics and people have to start smaller. But when you look at the numbers in Montgomery and elsewhere across states like Alabama, every state, frankly, we could blow it open. It's all right, we'll get there. But what it really does say more than anything else, is money should follow students. We're not going to rely on private organizations to have to raise money to fund scholarships. Why are we making people jump through hoops when public funding is available for these students who are no longer in the traditional public schools, who aren't serving them? What it does for opportunity and innovation is it allows people to appreciate and recognize that these elements are critical to students.It shouldn't matter where you go to school, money should follow kids.Michael Horn:Anthony, more broadly, and if you want to comment on this as well, great. More broadly, as you think about the education policy context, how it's impacted the work you do in Alabama and the students you serve. As well as how you think about expansion into other states. You just mentioned Mississippi. I'm sort of curious, how do you think about education policy context from what it's allowed you to do and what it might enable you to do as you think about other states?Anthony Brock:Sure. Well, the first thing that comes into play when you think about scaling to other states is how are we going to fund the school? Quite frankly, that's how we have to spend almost 50% to 60% of our time right now. The new AESA has passed. The School Choice Act. All these things are allowing us to be able to put our focus where it needs to be, which is on young people. Who better than the parent to determine what's the best place for my kids? I know I'm able to do that because your zip code should not determine where you go to school. I'm excited about it. I think the status quo in education is what's dumbed down education so much because we're not competitive enough.So it should not be a threat to anyone. If you're educating young people at a high level, you should welcome this. You should not be afraid of young people leaving your school either.Anthony and Jeanne’s Outlook for the FutureMichael Horn:Love it. As we just wrap here, so much is singing to me on what you're doing, Anthony. I just love reflections from both of you about where this all goes, how we keep building this movement, how we keep building up supply to match the demand of these learners. As you both mentioned, in places like Montgomery that are clamoring for something else, what are the next steps ahead? Jeanne, why don't you go first, and then, Anthony, you can get the final word.Jeanne Allen:I think looking at schools not only like Valiant Cross but all the other kinds of organizations that are innovating and trying to meet students where they are, regardless of space and place. Whether they're micro-schools, private, charter, online, blended, or some name that we don't even know, it's essential that we bottle and market the excitement and the exuberance that's out there right now for making change. What I see today, more than ever before is a pent-up demand that is dying to get out amongst so many more diverse players in every kind of genre that want to get together. That's critical. It's no longer about politics. It's no longer about, I mean, it is for some people, but for the people involved. They are thousands strong in every state and they could completely take over if they just put their minds to it.Michael Horn:Anthony, final word.Anthony Brock:My final word is, again, I'm thankful for being on this call. Thank you to the Yass Prize for creating an environment for best practices, and schools that are doing things that are outside of the box. I really appreciate that because it gives us all the place. You almost felt like you were an outlier for a while. Or the tipping point, not to quote too many Malcolm Gladwell books, but that's my guy. But, you know, that's what it feels like. I think I look at the Yass Prize as an outlier, and I think that everyone needs to just join and become a part of it. I would like to see people who are, you know, traditional schools, public schools.I would like to see more of them, to just open up their ears and see what they are talking about. They're talking about kids. Remove the policy. Remove everything else from it. We're talking about kids. I love it because everything I've heard since I've become a part of this movement is what's best for kids. They're celebrating organizations that are for kids. So thank you.Michael Horn:Hey, I'm just thankful for both of you, the work that you're opening up, the work that you're doing on a daily basis. I’m really appreciative of you joining the Future of Education and making sure that each child, each student can make progress because that's what it's about at the end of the day.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber. Thank you for subscribing. Leave a comment or share this episode.

Federal policy has immense power to influence incentives in higher ed. What can be done to better align them toward value and access?On the heels of my conversation with Phil Hill that posted last week, I sat down with Preston Cooper, Senior Fellow at The Foundation for Research on Equal Opportunity (on Substack at FREOPP Highlights), to talk through the effect of enacted—as well as the potential of proposed—policies coming out of the executive and legislative branches. We tackled a series of topics: income-driven repayment, outcomes-driven measures, accreditation reforms, and the opportunity for bipartisanship.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Michael Horn:Welcome to the Future of Education where we are dedicated to creating a world in which all individuals can build their passions, fulfill their potential, and live a life of purpose. To help us think through this is one of my favorite writers and analysts about higher education. A terrific thinker on smart policy to really put the power in individual's hands and focus on outcomes, reducing costs and the like for higher education. None other than Preston Cooper. He's a senior fellow at the Foundation for Research on Equal Opportunity, focusing on the economics of higher education. Preston, first thank you for joining us. I've been absolutely loving your writing and I will confess the biggest challenge for me in prepping for this was deciding on where to spend our time because you've been writing about so many different interesting strands of how higher ed should and is changing at the moment.Preston Cooper:Well, thank you very much for having me, Michael, and thank you so much for the kind words about my work. I'm excited to dig into it with you.Income-driven student loan repaymentMichael Horn:Yeah, absolutely. Let's start off with the doozy. You're fresh off publishing this analysis where you found that a lot of the income driven repayment plans that are intended to help individuals, spare them in essence from defaulting on their student loans. That these actually backfire when the federal government is pushing individuals into these plans. I confess that was a total head-scratcher for me when I first read the headlines. I'd love you to break down what's happening and why and what's a better way forward if it's not these income driven repayment plans.Preston Cooper:It's a great question. I'll start by explaining what exactly income driven repayment is. If you have a federal student loan, you can enroll in these repayment plans, IDR plans, income driven repayment plans that allow you to tie your loan payments to your income. After a certain number of years of making payments on these IDR plans, you can get your remaining balance forgiven. It can be a fairly good deal for students in principle. Some students, if their incomes are low enough, are even able to qualify for a $0 monthly payment on the income driven repayment plans. About a third of borrowers during the time period that we're talking about here, which was 2018 - 2019, qualified for that $0 payment. The study that you referenced was done by a couple of economists who were affiliated with the US Department of Education and had access to a treasure trove of data that pros like us basically can't have access to.We actually didn't know this before they took a look at the data. Basically what they did was they looked at those borrowers who qualified for $0 payments, so they didn't have to pay anything towards their loans because their incomes were low enough and they compared those borrowers to borrowers who were also on IDR, but whose incomes were slightly higher. They had to make very small but positive payments. They found that in the first year, those borrowers were enrolled in IDR. They had a big drop in delinquency rates as you would expect, if you have a $0 payment, you can't become delinquent on your loans. But after a year, something interesting happened, a lot of those borrowers became disengaged with the student loan system. They didn't enroll in auto debit, so their payments weren't automatically taken out of their accounts and often they forgot to recertify their participation in IDR.If you want to be an IDR, you have to recertify every year, so the federal government knows what your income is and knows that you want to continue participating in the IDR plan. They found that borrowers who had that initial $0 monthly payment about 12 months after they first enrolled in IDR, had this huge spike in delinquency and they were more likely to become delinquent on their loans than borrowers who never had a $0 monthly payment. Which is a really wild finding that a $0 monthly payment is supposed to protect you from becoming delinquent on your loans. But it turns out that in the long run, borrowers who qualified for that $0 monthly payment were more likely to fall behind on their loans, more likely to face those adverse consequences such as a buildup of interest and potentially getting a hit on their credit scores that come with a student loan delinquency.Michael Horn:Wow. Totally unintuitive. What would a better path forward in your mind look like? How would you modify these income-driven repayment plans?Preston Cooper:I think that IDR is still an important safety net for borrowers. Sometimes life happens, things don't work out, and your student loan payment might be too high relative to your income. I think it's important to have a safety net there, but I think that this experiment with $0 monthly payments has proven to be a failure. What I would propose is even if borrowers are fairly low income, require a very small monthly payment, say just $25 a month, so that they keep getting into the habit of paying back their loans even if it's a very small amount. That way they don't become disengaged with the system. They remember they have this obligation that they need to continue meeting if they're going to have these loans. Also so that they don't necessarily have a big buildup of interest because they haven't been making payments on their loans.Unfortunately, I think policy is kind of going in the wrong direction. The Biden administration about a year ago announced this big expansion of income driven repayment plans so that many more borrowers are going to qualify for a $0 monthly payment. Some of the preliminary data show that over half of borrowers who were enrolled in the Biden administration's new IDR plan are going to qualify for that $0 monthly payment. It's possible that that might increase delinquency rates in the long run because all those borrowers might simply become disengaged from the student loan system and not get into the habit of paying back their loans. I'm very concerned that this kind of well-intentioned expansion of IDR will end up backfiring on the borrowers it's supposed to benefit.Debt forgiveness repackaged? Michael Horn:Absolutely fascinating. But it connects, I suppose to another part of the plot, if you will, which is of course the Biden administration was not stymied, say by the Supreme Court ruling saying that their student loan forgiveness plan was not legal. Instead, they've continued to try what you might call creative ways to cancel student debt. So, they might say, well, this is correct, but who cares because we don't think student debt should be a thing. Period. They've continued to try some different ways to get around this as I understand it, sending out some letters saying your student debt is canceled. Can you just bring us up to speed on where we are and what you expect to happen there?The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Preston Cooper:Absolutely. There's a number of different irons in the fire that the Biden administration has right now with respect to student loan forgiveness. Number one is the new income driven repayment plan that I mentioned a few minutes ago. Another kind of lower-profile effort to forgive student loans, which hasn't gotten quite as much media attention, is the second attempt. At one time, student loan forgiveness used a different legal authority than the Biden administration originally relied on for the loan forgiveness program that was struck down by the Supreme Court. So, they're relying on something called the Higher Education Act. They say, okay, well the Supreme Court said this other law that we relied on to forgive student debt, that's not going to fly. So, we're going to try again. We're going to use a different legal authority to use as a fig leaf for student debt cancellation.They've been going through the process that they need to go through in order to try and propose something on student loan forgiveness here.  It looks like we're getting close to a final plan that they may formally propose over the next few weeks or months. Essentially what they want to do here is they want to say, if you're a borrower who is experiencing hardship, we are going to give ourselves the power to forgive your student loans. But what does hardship mean? I'm not sure they entirely know, but that's not going to stop them from trying. Basically, they say, we're going to take all these factors about you into account. Whether you received a Pell Grant, whether you finished college, a whole bunch of different factors, 17 different factors, they have a whole list. They're going to put that into a black box model, which is not accessible to the public.They're just going to pour all those factors into a model and out of that model is going to spit out an answer. Are you going to default on your loans in the next two years? If that answer is yes, then they're going to give themselves the power to forgive your loans. That's basically it. It's not necessarily a transparent process. They're going to put a bunch of factors into a model. It's not accessible to the public, and that model is going to say, you have the power to forgive student debt. I think this is problematic for a couple of reasons. Number one, I don't think they have any more legal authority here to forgive student debt than they did two years ago when they originally announced the loan forgiveness plan that the Supreme Court struck down. Number two, if this black box model is not accessible to the public and everybody who they say is going to default is going to get the loans forgiven, how are we ever actually going to test if that's an effective model? If you get your loans forgiven and you can't default on that, your loans. We can't really see if the model was effective at predicting your distress, your hardship. So, I am kind of very skeptical of this. I think that this is just an excuse to kind of forgive student loans on mass but give more of a scientific sheen to the way they're going about loan forgiveness than they may have approached it the first time.Michael Horn:Do you think we'll see another challenge in the courts as a result of all this, or is that path not as available this time around?Preston Cooper:I think it's fairly likely we'll see a court challenge to this as well. I mean, the same basic logic applies. The Biden administration has assumed itself a huge amount of power to forgive student debt for millions of borrowers with a taxpayer bill that could potentially run into the hundreds of billions. I think you have the same basic arguments that the state governments will probably sue over this as they did the last time. They'll say, this is clearly a major questions doctrine case. The Congress has to step in and say something. If you're dealing with dollar amounts that are just this big, the executive can't deal with those dollar amounts on his own. I suspect we will see another court challenge. It's probably going to take a while for that to make its way through the court. We may not have an answer right away, but I expect that we will eventually see the Supreme Court, or potentially a lower court, strike this down as clearly unconstitutional clearly goes against the spirit of the Supreme Court's ruling last June.The College Cost Reduction Act Michael Horn:Gotcha. So, if that's on the executive side of the house, if you will, let's go to the other side of the house. The house itself and the Republicans there came out with this College Cost Reduction Act, which has a lot to like in my view, in the proposed legislation free up. You all had this exclusive look, I believe, at how the legislation would affect colleges and universities nationwide because it has this carrot-and-stick approach in it, which I'll let you describe. But I want to give this headline because it was so interesting to me. You found that public community colleges, particularly those with strong vocational programs, would receive nearly $2 billion per year in direct aid if this legislation passed. The bill is essentially rewarding these schools for their low prices, high socioeconomic diversity, as well as the fact that they largely don't rely, interestingly enough given the past conversation, on federal student loans. So, I found this striking because community colleges more generally, they're not places that get great outcomes in terms of completion rates or transfer and things of that nature, it seems very in line with the Biden administration's hope for community colleges getting money through other means. So, I'm just curious what is going on here in this policy?Preston Cooper:It's a great question. I'll start by kind of describing the carrot and stick approach in the legislation that you referred to. Let's start with the stick. Congressional Republicans are very concerned about the fact that a lot of students who use federal student loans to pay for their education don't earn enough to pay back those loans in full. We see a lot of people relying on IDR who are not paying back their loans, and who are getting the loans forgiven. We see a lot of people defaulting on their loans. So basically, what they want to do is make the colleges co-sign a portion of those loans. So, if the student either requires assistance to pay back their loans through an income driven repayment plan or doesn't pay back their loans at all, defaults all their loans. The legislation would require the colleges where the students went to compensate taxpayers for a portion of those losses that the taxpayers suffered because the loans went bad.The goal here is to align incentives between the colleges and the students basically to say, if you're a college, you're charging way too much. Your students are taking on way too much debt relative to what they're earning after graduation, we're going to penalize you for that. So, you're either going to have to lower your prices to bring them in line with what you're graduates are earning, or you're going to have to figure out ways to make your education more valuable in the labor market so that your students earn more and that justifies the high prices that they're paying for your education. This raises a ton of money, obviously, because suddenly colleges rather than taxpayers are the ones who are suffering the losses on these student loans. And they plow a lot of that money into a new, what I call a performance grant program for colleges.It's not just community college colleges that are eligible. All colleges who are participating in the federal loan program are eligible for these performance bonuses. These performance bonuses are given out based on a formula that takes into account how many low-income students you enroll, how good are your graduation rates, what are your students earning after graduation, and are you keeping your prices low. We kind of crunched the numbers on this, figuring out which colleges would benefit from these performance grants. It turns out community colleges do well. One big reason is that they have relatively low prices, and they have a lot of low-income students. Their outcomes are not necessarily great, the graduation rates leave something to be desired in the community college sector ditto with earnings. But I think it creates some incentives for community colleges to improve those outcomes because suddenly the community college can qualify for a potentially much bigger grant from the federal government if it invests in programs with a very high return on investments and if it invests in interventions to make sure more of those students get across the finish line.So, we see, especially community colleges with a strong vocational and technical focus, community colleges, which you're focusing on the trades, getting graduates into very high-wage jobs, those colleges do well out of this performance bonus program.  We see that if this legislation were enacted, a lot of community colleges, particularly if they have good outcomes, could do very well. And schools that are relying very heavily on the federal student loan program and don't have great outcomes, could take a major financial hit from that.Outcomes-driven measures in TexasMichael Horn:This isn’t just theory, it occurs to me because you've seen this very thing play out in Texas, correct?Preston Cooper:That's right, yes. There's a college here in Texas called Texas State Technical College. And the state about 10 years ago kind of did something a little bit similar to what Republicans want to do at the national level. They said, for this technical college, we're going to overhaul the funding formula. So, you're no longer just getting an appropriation for how many butts you have in seats. Your funding from the state government is going to be based on what your graduates earn. We're basically going to give you a set percentage of your graduates' wages. This changed the incentives for the school so suddenly they can get more funding from the state government if they have better outcomes if their graduates go on to higher wage jobs. The community college essentially closed down some programs that were not paying off well for students and opened a bunch of new programs or expanded existing programs that did have a much better track record. It turns out the number of students they were serving went up, the average wages of graduates went up and their funding from the state government went up. So, it was a real winner for the college, but they had to be given the right incentives to make the changes they needed to make in order to serve students better.CCRA’s implications for private non-profitsMichael Horn:Incentives around outcomes matter. Fancy that. What was fascinating is that the story is quite different though for elite private universities.  I want to quote what you wrote here because you said, that despite their vaunted reputations, many graduates of these schools do not earn enough to pay back the loans that they took out to afford the school's exorbitant tuition prices. This is especially true for top schools that have pricey master's degree programs of questionable economic value for the revenue. You estimated that elite private nonprofits would pay almost 2 billion per year. Sort of the opposite of the windfall, if you will, for the community colleges in penalties under the Republicans' plan. The biggest loser would be the University of Southern California USC, which would have to pay nearly $170 million annually if it continued with business as usual. So, help us unpack what's going on here. USC. Sure. They're everyone's poster child for bad behavior at the moment, but how about Harvard? Are they going to be paying money back to the federal government as well?Preston Cooper:A lot of schools that have pretty high prices and rely heavily on the federal student loan program could potentially be facing a really big bill. I want to emphasize, that it's the reliance on federal student loans that is the real killer for some of these schools. So USC to take that example, almost 1% of the new student loans issued in the United States every year just goes to USC. They're so reliant on the federal student loan program, and a big part of the reason for that is they offer master's degree programs. They charge over a hundred thousand dollars for say, a master's in social work. And the amounts that people are earning after graduation just simply are not enough to justify those debt burdens. So right now they can kind of get away with it largely because of safety net programs in the federal student loan program, like income driven repayment, which usually means students do not repay the loans they took out to fund their education at USC in full, but somebody's got to pay the bill for that.And right now, it's taxpayers paying the bill. So the Republican proposal would say colleges are going to have to start footing a portion of that bill. So, USC, because it has all these programs where the debt is simply not justified by the earnings, could potentially pay a very large penalty under the Republican legislation. I believe the number is about 170 million per year. That's business as usual. But I think what a lot of the Republicans who authored this bill would say is that it's not necessarily about punishing USC, it's about changing the incentives to make sure USC does better by its students. We don't want USC to pay $170 million per year. What we want USC to do is to reduce its reliance on the federal student loan program, and bring down its prices so students don't have to pay quite as much to some of these programs that simply charge too much and don't have the earnings outcomes to justify it. Make USC a better school that does right by its students, and they won't have to pay that $170 million penalty. They continue with business as usual, though they're going to have to pay for it.Outcomes-driven measures in Biden’s planMichael Horn:Gotcha. I love it because that's a dynamic way to think about policy. It changes the marketplace incentives and actors rationally start to change what they do as a result. It circles back, I think, to the Biden administration because there are some ways to compare approaches here, right? USC, as I mentioned earlier, is sort of everyone's poster child, but especially theirs for everything that's gone wrong in higher ed in some respects. They talk about the bad contracts with online program management companies, and high-priced online master's degrees that you mentioned in fields like social work that don't get great earnings. On the other side, you've got the admission scandals at USC, you name it, they have it. The Biden administration has gone after some of this by revising the regs around third-party servicers. We might see them tackle the bundled services exemption with rev shares.You've got the negotiated rulemaking that's going after online education more generally with state reciprocity and stuff like that. But they're also taking this approach that on the surface at least feels more outcomes oriented like the Republican plan to have institutions have skin in the game. And that's around the rewriting of the gainful employment regs. If I'm not mistaken, I think those regs have now been rewritten something like four times in the last 12 years, I think.  You've done a lot of writing and thinking about gainful employment. How should we think about these contrasting approaches, gainful employment, looking at the loans people owe, and making judgments about programs versus risk sharing? Are there merits to both? Are there detriments to one or the other? What's your perspective on these approaches?Preston Cooper:It's a great question. So, to start with gainful employment, so what the Biden administration wants to do on gainful employment is they have a two-pronged test here. One, they look at each program that receives federal funding, how high is your student's debt burden relative to their earnings? And number two, are your students earning more than the typical high school graduates? And if you don't pass both of those tests, then you get kicked out of the federal student loan program. There is one massive, massive caveat to that though, which is that they only applied the gainful employment rule to for-profit colleges and career programs. So actually, places like USC, which as you said is kind of the poster child for malfeasance and higher education, they're going to be exempt from gainful employment. So that $115,000 master's degree in social work that leads to earnings of $40,000 or something like that, where students are never going to be able to pay back their loans without government assistance, that program would not be held accountable by gainful employment.I think that's just a massive, massive blind spot in the rules that they were very obsessed with kind of targeting the for-profit college industry where there have been many legitimate problems there. I'm not defending them at all, but I think that means we can't simply ignore the problems that exist at nonprofits like USC because often they're not serving students well either, or they have a lot of these bad outcomes that the gainful employment rule completely ignores. That being said, I am kind of heartened at the focus on outcomes in that rule. I think I'm less of a fan of rules that are trying to go after third-party servicers or state authorization reciprocity agreements because I think if you can make an OPM work if you can make an online master of social work, if you can make that payoff for students, I don't particularly care that it's an online degree. I don't particularly care if you offered it with an OPM. What I care about is are your students’ getting earnings, and getting jobs that justify the debt they took on. No matter how you get to that point, as long as you can get to that point, I'm pretty agnostic as to the method you used to do it, but we have to make sure that the outcomes are there.The opportunity for bipartisanshipMichael Horn:Yeah, look, that mirrors my thinking as well. It seems like the focus should be on the outcomes, not micromanaging the inputs, which frankly is going to restrict innovation and favor incumbents in all sorts of weird ways from other fields. You certainly would conclude. I guess I'm curious about your perspective as a watcher of all this, does this create a bipartisan opportunity perhaps for some collaboration and compromise, at least given the recognition, hey, gainful employment, maybe it doesn't get all the actors we should risk sharing. Maybe we want to tweak that somehow. Is there some room between them for the two parties to come together and get some forward progress, maybe actually get legislation rather than just reg rewriting?Preston Cooper:It's a great question. It's something that I think about a lot. I think in principle, there's a lot of scope for potentially a grand bargain on this. I do think that both Democrats and Republicans recognize that there are big swaths of higher education that are federally funded and don't necessarily deliver on their promise. I think in principle, there's scope for an agreement there. I think it runs up against a number of practical hurdles starting with the fact that basically every member of Congress has a college in their district and some of those colleges don't do well. And some of those colleges might get penalized under any kind of reasonable risk-sharing or accountability framework. And so I think once you start getting to this practical consideration, some of the bipartisan consensus that makes sense in principle starts to fall apart. And that's why I think the carrot-and-stick approach of the Republican plan is pretty valuable because it's not necessarily just taking away from higher education, it's also benefiting a number of colleges that are doing right by their students. So members can go back to their districts and say, Hey, this community college is doing pretty well and they're actually going to get a bonus from this. And so I think that's to make this politically feasible, that's what's going to have to happen. We'll see whether the Republican plan can get any traction among Democrats right now. The Democrats have been pretty in lockstep opposed to it, but we'll see. It might be a good starting point for [a] potential grand bargain.Rethinking accreditationMichael Horn:The future. Super interesting. So last piece of this, the College Cost Reduction Act also had this part that hasn't gotten a lot of attention around rethinking accreditation. And this might be a place for also bipartisan compromise because the way that the bill at least would propose is that you could have states creating what they call Q AEs, quality assurance entities, which is actually something borrowed a terminology borrowed from the Obama Administration's Department of Education in 2015. That would basically be new. I'd love your take on if you see this as an area for compromise, but also why introducing more accrediting agencies or defacto, I guess, accrediting agencies, why would this improve the state of affairs? Because it's not necessarily meaning that they wouldn't be membership organizations or that they would operate under different rules or anything like that. So what's the theory of action of introducing more accreditors or quality assurance entities?Preston Cooper:I think one massive issue that we face in higher education right now is there's a real dearth of competition, which means there's a real dearth of innovation. 95% of current traditional age college students attend a school that was started more than 40 years ago. There's simply not a lot of new entrants into higher education and not at the scale that can really provide competitive pressure to actually improve the state of affairs and higher education. And I think that's what those provisions of the college Cost Reduction Act are trying to get at. They recognize that a big problem here is the accreditors. So we have seven historically regional accreditors, which basically are the gatekeepers for new institutions seeking federal student aid and sometimes seeking just permission to operate. And those accreditors aren't necessarily friendly to new institutions. They're not necessarily friendly to innovation. Sometimes they'll just look at, if you want to start a new school, are you doing everything exactly the way other schools are doing it?So that doesn't really add any value there. Leave much space for innovation. So the Republican proposal would allow some new institutions to kind of get around the established accreditation cartel. They'd still be held accountable, but they could be held accountable by the state governments, not necessarily by accreditation agencies, by allowing states to either create or designate these new quality assurance entities that would be able to approve new colleges or existing colleges for the purposes of access to Title IV federal financial aid. That's Pell Grants and student loans. And so this could inject some competition into the higher ed sector if suddenly new institutions with a new way of doing things with potentially a more cost effective model or potentially a model that might get better outcomes if those new institutions suddenly have an easier path into the market that could put some real competitive pressure on incumbent institutions to try and improve their outcomes, lower their prices do better by their students. Now naturally, there have to be some safeguards there, and I think the bill has some appropriate safeguards to make sure we're not just approving fly by night or scam institutions to get taxpayer dollars. But I think the goal there is to create more competitive pressure in the higher education market. And I think that's a very laudable and a very needed goal that they're trying to accomplish.Michael Horn:In other words, part of the argument is that the University of Austin, Texas is the Minerva. Universities reach universities. There's a handful of others, college Unbound, et cetera. Those are almost the anomalies that prove the rule that it's really hard to start up a new accredited higher ed institution. And we needed better gateway, in essence, to facilitate a lot more startups coming into the market.Preston Cooper:That's right. I have a magazine article about the University of Austin coming out soon, and when I was talking to them, one recurring theme was this is just a very drawn out process to start a new university. It's almost a year to get permission from the state government. It can be four to six years to get permission from the accreditor in order to operate. We've got to hire all these people who know how to navigate the bureaucracy, and I have no doubt that they're going to be able to do it. They've got $200 million behind them. They've got a bunch of big names, they've got a bunch of experts in navigating the accreditation bureaucracy. But if you're not the University of Austin and you don't have $200 million behind you, that's going to be a really steep hill for you to climb if you want to start a new university. And so they are the exception that proves the rule. They will probably be able to start a new college, and I wish them the best of luck. I think that their model's intriguing and it could be very successful, but we need more than just a handful of new colleges. We need large scale entry into the market to provide real competitive pressure to the established institutions, which up until now have been able to coast.Michael Horn:Super interesting. Preston, thanks for taking us through this rundown of all things intrigue and proposals and machinations behind the federal machine that creates a lot of the incentive structure for the very rational as a result behavior that we see in institutions in higher ed. Really appreciate you bringing the wisdom here on the future of education.Preston Cooper:Thanks for having me. It's a pleasure to have a conversation with you.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber. Thank you for subscribing. Leave a comment or share this episode.

What’s the impact of the current federal higher ed. regulation regime on online education? That’s the question I addressed in my conversation with education technology consultant and industry analyst Phil Hill. We discussed the current administration’s effort to gut inter-state accreditation reciprocity agreements and its impacts on online universities serving students across state lines. We also discuss the Department’s third-party servicer regulations, gainful employment measures, and the importance of finding a bipartisan path forward. This is the first of two conversations exploring the impact of the current regulations and policy proposals in higher education. Don’t miss my conversation with Preston Cooper next week. The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Michael Horn:Welcome to the Future of Education where we are dedicated to creating a world in which all individuals can build their passions, fulfill their potential, and live a life of purpose. To help us think through that today, we have a terrific guest, Phil Hill. For those of you that tune into my other podcast Future U., you will know Phil because he's been a guest before, but he is an education technology consultant. He's an industry analyst extraordinaire at Phil Hill and Associates. He writes the terrific newsletter and blog “On Ed Tech.” That's the name. It's “On Ed Tech.” Please subscribe. It is an absolute must-read to understand not just the major trends in Ed Tech, but also higher education more generally. I learn so much every time I read it and every time I talk to him. Phil, thank you so much for being here. I really appreciate it. I can't wait to learn from you this time.Phil Hill :Well, thank you very much, and with that intro, I think we should wrap up the show. Just leave it at that.Michael Horn:It's all downhill for you from here, right?Phil Hill:Yeah, I appreciate it.Is the Department of Ed. Targeting Online Education?Michael Horn:No, in all seriousness though, I think we're going to learn a lot. And obviously for those that know you were on our Future U. show. You anchored our 101 deep dive on OPMs—online program management companies—and the impact that they're having on higher education more generally. Now we're in a moment where OPMs are perhaps struggling and we may get more into that. You've argued persuasively, I think that revenue sharing and OPMs are perhaps not dead. Even more provocatively, and where I want to go right now, you and your colleague, Glenda Morgan have written that this current Department of Education under the Biden administration is trying to target online education more generally. In other words, this isn't just about OPMs. This isn't even just about for-profit universities. This is about online learning period. That's striking because roughly 54% of students, as of fall of 2022, 54% of students are taking at least one online course. And that's to say nothing of the broader world outside of accredited higher ed, where adults tune in regularly to learn from YouTube, LinkedIn Learning, Coursera, Udemy, Pluralsight, you name it. So, I would love to know just what's behind this assertion that this Department of Education is targeting online education?Phil Hill:Sure. Before I do that, I will say it's sort of amusing starting out with this framing because Morgan, she goes by her last name. She wrote a post recently, two months ago called Online is the Target that encapsulated this idea. At the time she wrote it, there was a little bit of me saying, okay, so you're finally catching up and realizing some basics. But you're a great writer, so let's see what you come up with. So I initially had sort of a dismissive tone to it, but then she put out the article and it's called Online is the Target. You'll see it if you search it online. And it was profound. Sometimes I get so deep in the weeds and finding out what's happening that her post really helped me step back and say, wow, this really is completely obvious that the regulatory activity is not just saying online education at nonprofit institutions getting hit as unintended consequences, but it actually is the target itself.And what we're seeing this year is making it crystal clear. So I love talking about that because I think it's so significant. It affects so much more than the OPM market. It obviously goes well past the for-profit industry. But I mean, I guess just to get started, what's being apparent, what's apparent now and was a parent of Oregon a couple months ago is the fact that if you look at the regulatory activity last year, so much of it was around gainful employment, which targets mostly for-profit schools, but also certificates seeking programs at nonprofits, TPS, guidance expansion, third party servicer and bundled services, things that were explicitly going after for-profits or OPMs. If you look at what's happening today, now you're getting into things such as we want to gut the state authorization reciprocity agreement, and let's just go into that for a little bit of detail and help explain it.Think of it as a driver's license that imagine if you had to drive across country and you needed to make sure that if you're going the route that I'm about to go, by the way, I need to get, yeah, I have a driver's license from Arizona, but I also have to have permission to drive in Nebraska and Kentucky and elsewhere. Well, it would be very painful and it would really prevent mobility and the ability to actually drive around the country freely. So we have reciprocity with driver's licenses so that my Arizona license goes anywhere in the us. This is happening for online education through a reciprocity agreement. The Obama administration said, you have to get authorized in each state where your students reside even if you're online. Well, that is chaotic, particularly for schools with a smaller online presence. The reciprocity agreement was an agreement between states that made it realistic for online programs to actually do that.Like Southern New Hampshire that has hundreds of thousands of students, trust me, they have an army of compliance officers. They're getting authorized, they're following it. But your everyday university that has a few online things, they're the ones who really need reciprocity. Well, we have an agreement and it's really helping in the market, the current set of negotiated rulemaking that's happening right now. The Department of Ed very clearly wants to gut the reciprocity agreement and say, no, you have to go back to the way we were before and actually get authorized in every single state. Well, now if you have a small program, that means there's a lot of online stuff that you're either going to not do the online program or you're going to say, we can't enroll students from these states. We just can't. It's unrealistic. And the primary institutions that are going to get hit are going to be nonprofit institutions with smaller online programs. So that's one specific example that really flavors what we're seeing and why. The argument is it's online education itself that's being targeted as a problematic practice or something deserving of much more scrutiny than campus based education. So I don't know if I directly answered your question.Impact of Regulations on Small CollegesMichael Horn:It's really interesting around state reciprocity and the regulatory burden that we'll create for colleges and universities. And look, you're right, obviously like a Southern New Hampshire University, 250,000 students are so unenrolled, they've got lots of money, lots of people that they can throw at this to make sure that they are registered properly in each and every state and make sure students can continue to enroll and so forth. But you mentioned the private college, and I'd just love to pick at that for a moment to understand it better because we know that for the most part, most students who enroll online, they're doing so 50 to 75 miles from where they live. So for that small college that has an online program, how many students are they really enrolling out of state? Isn't that more of those national players, the Arizona states, the Western governors universities, the Southern New Hampshires? Aren't those the ones that are really enrolling students from state to state and therefore can handle this? Or is this going to impact small colleges for other reasons?The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Phil Hill:Sure. And just to clarify, I don't think it's just small colleges. I think it's even large colleges and universities with small online programs. And I mean, you're bringing up a great point. The majority of students reside within 50 to 75 miles of their online program. So what's likely to happen is they will for the first time, certainly naturally, really for the first time, they're going to have to pay attention to it. So they're going to have to figure out what's going to happen. They're going to have to say, well, where do you reside and can we register in this state and get authorized in this state? And so what's most likely going to happen is they will have to say, if I'm in Illinois and I have a smaller program, Illinois, we're here, we're authorized. I'm only going to allow students from Wisconsin and Indiana and Iowa, Iowa commonly known as Western Chicago to be within this program. And outside of that, we cannot allow students to come in. So I think that's going to inhibit their growth. That's going to reduce choices for students, and it's probably also going to add costs. You have bureaucratic burden, so it'll be more difficult to create new online programs. That's my guess of what the impact will be.Third-Party Servicer Regulations Michael Horn:No, that's really helpful. Thank you. And it's interesting, obviously because that increases regulatory burden on colleges and universities. And then there's been this other provision that the department has done through third party servicer regulations, and you were really the one that raised the alarm bell on this, but to remind folks, the Department of Education was expected to regulate revenue sharing agreements to really go after OPMs, and they instead went much farther. Essentially, they took a reg that had applied to vendors that were handling financial aid money and so forth and said, now we're going to ask colleges to make sure that any vendor you're working with in instruction and student support and information systems and on and on, we're going to make sure that they have audits, that they're put through a whole host of restrictions and so forth. Big expansion of federal power, big expansion of bureaucracy and regulation. And as I said, you raised the alarm on this, the administration stepped back from it, and now you said you don't expect something further until April of ‘24. So shortly after this comes out. I'm just curious, is this still your point of view and what do you expect them to do?Phil Hill:Well, I've changed my mind on the projections of where it is, but just to step back, one thing I would say that's a little bit different there, there was a clear target in that case that was very much crafted as a mechanism for the Department of Ed to regulate the OPM companies particularly, or mostly those who do rev share agreements. And it just happened to have unintended consequences across the market,Michael Horn:Collateral damage. And they didn't care.Phil Hill:Well, yeah, they didn't care. But how deliberate was that? Because when you say regulatory burden, it's not just like, okay, we have regulations. You have to go through a lot of pain. There's a power dynamic going involved. There's a thing of we want to be the arbiters of what's allowable and what's not allowable across the board. So there's a deliberate, we want to shift the power from states to the federal government that I think has some deliberate things. I think what was unintended were the negative consequences were people haven't thought it through. The big through line, I would say between all of these is the Department of Education and the activists, most of them funded or partially funded by the Arnold Ventures Foundation. It's a consumer protection mindset. Their fundamental axiomatic belief is that most bad things that are happening are because of bad actors and therefore to help students, we need to find those bad actors and reign them in. And so everything is seen through that lens, that's through line, that's going throughout there. And so at the time with TPS, it was, well, if we're noble because we're reigning in rev share the fact that we have a little collateral damage, oh, no big deal. I don't think they realized how big the collateral damage was until there was such a public outcry on, do you realize what's happening? I really don't think they understood that fully.Michael Horn:That's super interesting.Phil Hill:But it's always that there's a consumer protection mindset. And then as I said, the big changes this year, it's become so much more apparent that part of the definition of bad actor includes not all online programs, but online programs are so susceptible to bad actors that we need to target that area because that's where most bad things happen. So that's the true line is the consumer protection mindset.Michael Horn:And so the assumptions seems to be, if I'm following you correctly, that if you're online, you're probably doing something predatory, right? You've got a bad actor here, and so you need a set of, in essence regulations that's going to in effect get in the way before we hurt students, right? It's going to block, and we're not doing this by looking at outcomes or looking at the programs. We're really looking to regulate the inner workings of how you register with states, how you enter into your contracts with different private providers, all the sort of micromanaging and effect of how you actually set up the operations themselves.Phil Hill:Yes, and I would add to that, go back to the reciprocity. What the effect of gutting reciprocity does is it enables individual state and the attorneys general in those states to take legal action to help do this. So that's another very big side of how this administration handles regulation. It's sort of a multi-front campaign, and so they want to enable states to take action such as the state of California taking action on Ashford University. And so that's what they want to maximize is the opportunity not just for the federal government, but for the states to actually take action. There's part I didn't answer before. Back in the fall, I was predicting that they pulled back TPS guidance, as you said, I was predicting at the time that they wouldn't do it this year because of the election because it's so unpopular. I was wrong. They are pretty much going for broke on so many new regulations. They're not taking a let's be cautious during an election year approach. So the soonest we'll get new TPS guidance will be April, and that's based on court documents where they had to state to a judge where their plans were. Of course, it's possible they'll keep kicking the can down the road and it won't actually come out, but it could come out as soon as April or May of this year, a revised set of TPS guidance.Michael Horn:Maybe you don't know, but do you expect that it's going to be more narrowly confined find to focus on the OPMs through the third party service regulations, or might they walk back completely and say, Hey, we're going to go after the dear colleague bundled services 2011 letter that really made rev share legal, if you will. Obviously OPMs had been around before then, but this in effect gave them safe harbor. What's your expectation of what they'll actually do here?Phil Hill:Well, first of all, to their credit, they pulled back on some of the things that were ridiculous, such as if you follow make everybody, most of EdTech follow third party servicer guidelines. You have the auditing, which you mentioned, but you also have the thing of no foreign companies, no non-US companies.Michael Horn:Which seemed to violate treaties.Phil Hill:Oh yeah. Yes. And so they pulled back on that. So it's not going to have that type of arrangement. It's going to be they explicitly wrote stuff that would make the LMS companies be liable for this. I expect that if they get new guidance, it will target not just OPM, anybody who's doing revshare and who's doing marketing and student recruitment support of a school, I think that's going to be the scope of what they come out with if they do it. Now, the bundled services exception, which enables rev share OPMs, that's tied to it, but it won't be directly addressed by the guidance where it's tied, is politically, and I realize I got to be careful how I'm saying this, but it's consistent with what I'm seeing, but there's a little bit of a coordinated campaign. There needs to be an answer because at this point, they have not added regulations against OPMs.They tried it with TPS guidance, they had to pull it back. Bundled services exception. They keep talking about it, but they haven't released it. Well, if I'm on Senator Warren's staff, I've been pressuring the Department of Ed take action on OPMs. You have to say, as of today, they haven't. And so I think that one or the other is going to have to be done just for the political pressure reasons this year. And so part of the forecasting, it's figuring out which is more likely or both. I think it would be difficult for the Department of Ed to just do what I originally predicted back in November, which is kick the can until after the election. I don't think they could do that. So the tie in is political, not regulatory, really.Gainful Employment Measures Michael Horn:These politics are so interesting because as you said, you would expect them to not do something in a presidential election year, but because of senators in their own party, the pressure from them, there's more interest in them doing something and so forth. And that consumer protection mindset, I get it. It's to sort of catch the bad actors by micromanaging in some sense inputs. But then they've got this other element that they've done that feels more outcome oriented, at least on the surface. And that's gainful employment, which has actually gone through this is like its fourth revision I think in the last 12 or so years. And now the department has added two elements. In essence as I understand it. The first is this earning premium. Basically our graduated students, are they earning more than high school graduates in a particular state? And then they have the FVT, the financial value transparency, which again, as I understand it applies to all programs regardless of tax status or type and basically would create a disclosure for programs that are failing gainful employment regs. I would love to know what's going on here In your mind, you've been critical of these regulations as I understand that as well. So why,Phil Hill:And I'll try to explain, at least start out with sort of what I think they're trying to achieve and sort of the rationale behind it. So gainful employment was much narrower back during the Obama administration. They had two rounds for different reasons. Court cases drove them to do it, but that only said it was for-profit, any degree program or certificate program or certificate programs, career programs at nonprofit schools. When they added that got defeated and in a lawsuit. And then by 2019 it was rescinded, it got reintroduced with the two scope items you just mentioned the earnings premium and the FVT. To their credit, one of the big complaints about gainful employment is why are you attacking just for profits? That's not fair. If we're going to hold people accountable, why don't we do it across the board? Financial value transparency applies to, well, it applies to every degree seeking program in the us, whatever school you are, if your program in any way accepts federal financial aid, you have to report the data and it's going to be publicized.So that's why they call it transparency. And it's across the board, it's equal opportunity now. It's got a provision in there about if you fail it after two years, you have to force students to sign an acknowledgement that, Hey, I'm signing up for a failing program before they get awarded any financial aid. So that's going to harm enrollment. So I think the rationale there is pretty clear we need to hold everybody accountable. So on the surface, that's a very good argument. I think the biggest problem with that is the people behind it assume the data is much further along and much more accurate and consistent than it actually is, and they're not taking into account edge cases, poor data and stuff like that. And so we're going to have a lot of unintended consequence. The earnings premium, and I just saw the Department of Ed official describe this on a recent webinar with the Association of Institutional Researchers, sorry, and the department ed guy described it.He said, we realize there are programs that where students come out with low debt, but we think they're still poorly performing programs because the earnings of students coming out is not that high. So we want to also go after them even if they have low debt for students coming out. That's the impetus behind the earnings premium expansion, the core gainable employment that's closer to what it was back in the Obama administration. But these two new pieces, I think that's the, well, I've heard it come from the department that's the rationale for them to do both of those expansions.Michael Horn:I just love you to double click on that because so is the real issue that the data is not what you expect to see and sort of what's the problem with that?Phil Hill:Let me describe the concern. Overusing bad data assumptions first, the concern is, and the reason that I care about this and so many people I know care about it, is if you trace the logic through and whether you believe that there's systematic discrimination in the US or not between male and female, let's go with that. Females on average make lower wages than males. That's in the data. So forget your politics, it's data. Well, if you aggregate your comparison of here's what a typical high school graduate would make and you ignore some simple demographics such as race area of the state and stuff like that, then you end up making it more difficult in this case for females because their baseline doesn't account for the fact that they tend to make less than males. So you might have a female where their earnings would be higher by taking this program, but they get penalized because that's not accounted for in the way they define the data for the rules.And there's a myriad examples of that, the net effect, and I've heard people say this in conferences. You know what the safest play is? Just admit white males. That is the safest way to stay clean with the new regulations. Now we know that's not what the Department of Education wants, but as you trace it through, that's going to be the impact. And Morgan wrote about this with law schools and it was a similar type thing. A lot of those, because law schools tend to have very high tuition and debt, a lot of them will fail these regulations and force students to sign this acknowledgement. You're going to a failing program, and we've talked to numerous people, there's going to be pressure to play it safe, which means it's going to harm disadvantaged groups. So that's what I mean. And there are many different examples in there on where the, but it's almost not just poor data, but poor assumptions about that data and what it can do. That's the reason that I and many other people have been critical of what's happening.Finding Bipartisan MiddlegroundMichael Horn:It's really interesting. So your standpoint in essence isn't that we don't need measures focused on outcomes over inputs, but really that what would be your approach forward?Phil Hill:Well, I mean there's a little bit of a leading question there. Outcomes is obviously a key thing. Don't just say what theoretically might happen. Actually find out where students are getting harmed and that's where you focus your regulations and then don't make up things saying, well, they have low debt, but let me add somebody else something else just so I can catch something. I think that I would be cautious, I would be less aggressive in how far you advance regulations at each stage so that you can get the data and then you get buy-in and then you can move it forward. Here's the ironic thing. Most people I know, and most people such as myself who are very critical of what the Department of Ed is doing, we actually share the same goals. We would like to see student debt reduced. We would like to see opportunities for multiple students, whether it's schools or whoever.If there is bad behavior, we would like to see that address by regulation and not just let it slip through the cracks. So there's actually a lot of agreement on goals, and I think there's a possibility to get there. Now, here's an ironic mark. It just came out I think today, if not yesterday. There was an OP-ed by one of the executives from Arnold Ventures, who's one of the main sources behind these moves recommending calling. I think it was a real clear politics that was published Kelly Ree. But she was saying, here's the opportunity for the Biden administration to work across the aisle, find the areas where we agree and actually make things happen. And so they called out. So for example, here's an interesting fact. The save act, which is being advanced by Republicans in the house, there is some interesting commonality. They believe in collecting data on programs and making it public and holding colleges accountable for it.Well, there's a huge amount of overlap between that and what we're doing with financial value transparency. So if I were in charge of the Department of Ed, I would actually follow what Kelly Re's op-Ed said today, and I would say, Hey, let's find the overlap of what you're pushing with financial value, transparency. We're not going to, neither side's going to get both things, but let's advance the ball and do it in a way that listens to feedback. When people say watch out, there's unintended consequences. So I would be boring. I would be more cautious of my approach.Michael Horn:I gotcha. So it's more of a let's take measured steps forward, get the research, get the data, iterate, learn, move forward. There's some room for bipartisanship there and sort of this incremental approach as opposed to big foul strokes that may have unintended consequences.Phil Hill:And I agree, they're definitely a poster child or I call them a bellwether if you want to see what's going to hit other companies look at 2U, good and bad. One thing to clarify, their current pain is very much driven by the financial markets. The end of effectively zero interest rates that mark the 2010s, and they amassed way too much debt without the ability to pay for it. I actually have been doing deeper research. I haven't written my next post, but here's the key. They are saying we have enough liquidity to make it through this crisis. It's not a liquidity problem. They have cash, they're operating, it's fine. It's a maturity problem. Their debt matures in January of 2025, and they could not pay for that without refinancing. So the nature of the crisis is the status quo leads to bankruptcy. Now, bankruptcy doesn't mean out of business.We can't support programs. We saw this with Cengage a decade ago when they went bankrupts longer than that, bankruptcy means we're going to restructure, we're going to have to work with debt holders, see how much they get. It's going to be a multi-year legal process, and it's part of a turnaround. Now, what 2U wants to do is say, no, we want to actually refinance that debt fairly soon so that the crisis is over. The problem is it's a very difficult market to do that in because of interest rates and multiple reasons. So they're attempting a turnaround. So what I expect over the next year is either they are able to find a way to refinance their debt, and you'll read all about it. They'll make it very public. They'll pull a rabbit out of the hat, or they'll do an excellent job depending on how you want to describe it, or they're going to go bankrupt.And if they're going to go bankrupt, they will be still operating, but they're going to be restructuring the company in that. Now, I suspect strongly, and I've said in my articles, one of the ways to do this is you sell parts off. And I don't think they can sell the edX. It's too integrated into their strategy of lowering marketing costs as a platform. Yeah, boot camps, what they bought with trilogy boot camps are facing some really hard times, which might mean you can't get much money if you sold that off, but it also means, well, let's stop losing money from them. I don't know. If I were running things, that's the part I would look at, but you are likely to see part of restructuring. It's not just layoffs. It will be, let's sell this part of the business and focus. And so I think that's part of what you're going to see moving forward.But you've got to watch it because if it's going to get dangerous, if they get into the fall time and haven't refinanced yet, because even if they're able to, now schools only have a couple months runway until their partner might go bankrupt, doesn't mean they're going out of business, but there's a risk management and a risk profile that institutions can take. So that's the thing to watch this year, refinance or bankruptcy. And then the big question either way, how does that impact how well they are working with schools? And so the question then wouldn't be for me, it would be go to their university partners and ask them, how's your program doing? Are you getting service? That's going to be the key question this year. Now what's going? But I think it's crucial to note it's that financial market that's driving this chaos, this financial crisis that they're in right now. So there's so much happening in higher ed changing it, and that's another element that's out there. It's not all regulation, it's not all enrollment. It's also the financial markets as well.Thoughts on OPMs Michael Horn:Alright, well before we wrap up here, we have just a couple more minutes. I think let's just finish with some thoughts on OPMs because you've written a lot about 2U and the challenges that they are currently facing. Talk to me about what's going on there with 2U and what do you expect to happen to them?Phil Hill:Yeah, absolutely. Yeah, so there are multiple that gets back to where this company, for better or worse, so often is the poster child or the bellwether. So they might be going through it in a public way this year, and it's interesting to watch, but part of the reason it's interesting to watch is it tells us a lot about what other ed tech companies are going through. So you is so much a bellwether showing how there are multiple mega trends that are impacting higher education right now. It's regulation, it's enrollment, it's financial markets, it's the loss of confidence in higher ed and the real challenges, higher ed universities, colleges, but also the ed tech ecosystem. They've got to deal with all that. So the changes that we're seeing right now, those are sort of the macro trends or mega trends that are driving so much of it. So it keeps your job and my job interesting this year.Michael Horn:Well, Phil, if 2U is a bellwether for OPMs and maybe online education more generally, I think you can be our bellwether for all of this, helping us navigate and figure out these times. So just really appreciate you joining us on the future of education to help us think through a lot of important issues impacting what higher education is going to look like in the future.Phil Hill:Well, thank you. I really enjoyed our talk as usual.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber. Thank you for subscribing. Leave a comment or share this episode.

As mentioned last week, Diane Tavenner, Stacey Childress, and I recorded two episodes reacting to the three-part podcast that a16z venture capitalists Marc Andreseen and Ben Horowitz recorded on higher education. In this second episode, we reacted to the venture capitalists’ proposed solutions for higher education. This was also a juicy conversation, and we look forward to your thoughts!The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Diane Tavenner:Hey, Michael. Hey, Stacey.Stacey Childress:Hello.Diane Tavenner:Well, we are doing something for the first time here on Class Disrupted. We are recording a two-part podcast. And so here we are in part two. We've got the amazing Stacey Childress with us for this experiment, and she's hanging in there. She came back for number two. So, as a reminder, here is what we're up to. The three of us all listen to a very lengthy multi-part podcast by Marc Andreessen and Ben Horowitz, very successful and respected VCs and entrepreneurs. And their podcast broke down the problems with higher education and the solutions as they sort of saw them and proposed them. And then also had a third session on questions from X, Twitter, whatever you want to call that thing. So lots of people told us we had to listen to what they were saying, and we did. And then, quite frankly, we really felt compelled to join in this really important discussion. We were super grateful they were having it. We felt like we could add some things. And so in our last episode, we tackled the problem that they had laid out in their first episode. So we did that in our first and really broke down what they got right, what they missed, what some things we had some quibbles with. And today we want to flip to their solution. So, kind of mirroring their approach.Michael Horn:Yeah. And suffice to say, I think we had a lot we liked in the problems that they identified, some nuance that we tried to add to their conversation to set us up, I think, for a more productive set of solutions. And again, the disclosure that we're all on the board of Minerva University, and we kind of think that we might be an interesting solution to some of the problems that they posed. But with that as sort of prelude, I think let's just jump right in. They offered a bunch of solutions as they went down the bundle of their twelve. They talked a lot about how you could unbundle and rebundle a lot. I thought that was an insightful framing as you think about solutions to these operations and these real valuable functions that places play. So, Diane, where would you like to dive in?The benefits of centering teachingDiane Tavenner:Well, for me, Michael, the solution episode is where things really got spicy. And you know that really isn't a surprise. I often find that people are really good at breaking down and dissecting problems, but they often don't offer very satisfying or promising solutions, especially when you're talking about big, complex systems problems. And so I'm not surprised that I wasn't feeling satisfied in that episode. And in fact, I feel like I've made this complaint about a lot of the books that I've recommended on this podcast. So it's not that there's not value in there, but I definitely have some disappointment with the solutions that Marc and Ben proposed and that lots of other people propose, especially when you get into education. And so I guess where I want to start is, let's just go through some of them, and I pulled a bunch of them out and I'm curious what you all think about them. And so let me just start on the positive, what I agreed with, and we talked a lot about this in the first episode, so don't have to spend a lot of time here. But I actually agreed with their solution, that one of the things that colleges and universities need to do is focus on educating students and refocus, reignite their purpose around that. And in doing so, they should be able to reduce administrative overhead. And so they talked a lot about how in a number of universities, there are reports now that there are literally more administrative people than there are students, which kind of, to any person sounds insane. And I think we know that to actually be true know they have a perception of cost ballooning. Michael, you gave us some real nuance around that in the last episode, so we can take that or leave that. But this ballooning, this lack of focus, contributes to a lack of direct service to students, and we should just literally, dramatically reduce admin and in doing so, reduce cost. And so I'm curious what you guys think. The last thing I will just say quickly before I turn it to you is I do believe this is something we've done at Minerva. Minerva has prioritized student learning, the student experience. The three of us, as trustees know for a fact that the admin is quite lean and that cost structure is significantly leaner as well. So I do think we have at least one proof point that it can be done.Michael Horn:Yeah. Stacey, why don't you jump in first? And this is the format we'll follow for people listening. Diane's going to go through her list. Stacey, and I will react bullet by bullet, so to speak. So go ahead, Stacey.Stacey Childress:Yeah. On this one about refocusing on students, I would say refocusing on the purpose of the time in the program, whether that's two years, three years, four years, because I think you could play with timing as an innovation potentially. But while we're here together, learning much more, focus on purpose and helping young people expand their opportunity set. To me, it can be an early function of a higher ed experience in your first year or two where you're able to get better, clearer insight into a path or multiple paths that you may or may not have come in thinking that's the path you're on. Now. For lots of kids, they just come right in and go, and that's fine, but lots of them don't. And so just like thinking about what's really the purpose of the first year, what's really the purpose of that bridge from first to second year, what are we trying to help make sure students get to the middle of their second year at end of their third semester, kind of knowing about themselves, knowing about what comes next and what needs to happen. Just really kind of think of that backwards mapping. If we're headed here, how would we think about what needs to happen from the beginning to get there? And I just don't think that's happening anymore. So I liked the idea that it might be possible for institutions that want to really focus themselves on student development and acceleration to rethink the way the experience works without having to add a ton of costs and in fact, probably be able to reduce costs if they really streamlined around that purpose, therefore that value prop, therefore that experience that needs to be created and managed over time. So they didn't exactly suggest that. But I do think from a solution standpoint, I think there's real power there. And we said that with Minerva, we've got more of that mindset, but we were able to design it from the beginning that way. Or we weren't. I wasn't. I wasn't there at the very beginning, but not too long after. But that's the purpose at Minerva, and we're organized around it and can constantly get better at it, for sure. But we're organized around it. And I think it's a thing that existing institutions could move to. It doesn't seem impossible. It seems really hard, and it would take some time. But I think we have some examples of the improvement of some credentialing. I'm most familiar with it around master's programs, but I think that actually gives me a little bit of hope that you could think differently about the experience in ways that doesn't require you to blow up everything but does create opportunities to redesign at the kind of major/degree level. I don't know. I think it's possible and desirable.Michael Horn:Yeah, that's super interesting. I like also how you said it, Stacey, which is, regardless of what the universities do, they need to focus around a purpose. And so for some institutions, I will be delighted if they say it's research, because I think that's a very important societal function that's different from the one we've chosen at Minerva, which is fundamentally students. I think doing so on either end, I think, will reduce administrative overhead and cost bloat. I think you need that clarity. I will say the second add to you all that I think maybe, I don't know that it's a disagreement, but it follows from where you were going, Stacey, which is like, I don't think it's quite student centered. I think it's student purpose. And so, meaning, if we're backward mapping from, we want these individuals to go out into the employment world and society and be able to contribute, what does it. And I think it's a slight addendum to the student centered language only in the sense that you could argue that the opulent dining halls and residential palaces and so forth of colleges are very student centered in a weird kind of way. But I think it's because they've treated students as customers as opposed to clients. And my distinction there is simply, like, the customer is always right with a client, you kind of got to nudge them and help them because you're helping develop them. And so that's my one sort of maybe controversial nuance. But I think we should have teaching institutions, they shouldn't try to do research, and we should have far fewer research institutions. But I still want some of them.Diane Tavenner:I love that distinction, Michael. And it's so interesting how I think about this kind of as an insider and then a parent perspective, in that I actually, as a parent, see those sort of, let's call them resort style or luxury resort universities as detrimental to the development of people in the 18 to 25 range. And so I don't ever see that as a positive. But you're right. That's what some, especially elite families want. And that's like driving things. So super interesting. I will just say that Minerva is the opposite of that. As we both know, it really is designed to help develop young emerging adults and their skills. And it's really impressive on this front.Michael Horn:And they've done that backward mapping that Stacey just described in excruciating, incredible, awesome detail.Stacey Childress:Brilliant.Diversification of purpose and opportunitiesThe Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Diane Tavenner:Yep. Okay, so the second solution that I agree with, and here's where I'm really going to practice some grace, because I don't really think they said it the way that I would. But anyway, they seem to believe that it would be really healthy to have different universities and different departments within universities offering really different opportunities and appealing to different people and interests and passions and skills. I think they say that repeatedly, and I believe that that's really something they care about. And I 100% sign on to and agree with that. I'm super excited about that. Right now. We have one flavor and they're all vanilla. And how could we have some really different types of offerings? However, in that conversation, they got all caught up in DEI and politically hot topics. And so their discussion of it was kind of bumbly and in some cases came across as sort of biased and stereotypical. We unpacked that a lot on the last episode, so I'm not going to go back there. So instead, what I'm going to try to do is say what I think they would sign on to, given what I tried to hear through what they were talking about, which is what I would call the Todd Rose approach. And Michael and I have talked to Todd a couple times on the podcast, but basically, he really advocates for the end of average, which in his research and work suggests that what we're promoting in university admissions right now is everyone driving towards being on a very small number of measures, the same as everyone, only better. So it's like, we're all going to be good at these three things, and now I'm just going to try to get better than you versus recognizing that the world needs whatever, hundreds, thousands of different things and that different people bring those different... And we would be so much better served if we were cultivating all that diversity of talent and expertise and interest, and if we had a collective university system that was really enabling and doing that. And so I think they were trying to zoom out to that systems level and say, wouldn't that would be ideal? And I want to throw it to you all, because I do think this concept of like, imagine if students were applying to colleges not because of their ranking in U.S. News and World Reports or wherever we're getting it these days, but because it was really a good fit for them personally. I mean, that's the ideal that I think Ben and Marc would sign on to. I think society would benefit from, and I think it would, gosh, just be so much healthier for our young people and our country.Michael Horn:I love where you just landed, Diane, because to me, it took them a while to get there, which I think is what you're saying. But I think that was the underlying essence, which is that they were saying it's not just Math and English Language Arts that matter. If you're an awesome musician, there should be a way to show that. And then I think it would make it easier, frankly, for colleges to differentiate, which is the art of strategy. Colleges don't like differentiating right now, to your point, the opposite of strategy. That's part of the problem. But they had this, I think, somewhat bizarrely said, SAT should be infinitely scored. I kind of agree with it. Like, if you're really good at math, I'd love to see how high you can get. And I want lots of other performance measures that you could showcase your talents on to show who you are. And you're going to have this jagged profile at the end of the day. And I think that's. Again, I'm not sure that they said it that way, but I think that's what they fundamentally were driving at, and I'd love to see it. If you get out of the SAT as IQ test, I think you can make that leap a lot easier. And then it gets exciting, and I think, Stacey, and I'll throw it to you here, I think it also gets around in the longer run. This point you were raising in the last episode that we're actually not ready to leave the SAT, because when we do, it actually becomes worse and more biased toward people who have lots of wealth to develop essays and projects and go on saving the whales and blah, blah, blah. Like things that we're not sure were about that we're trying to optimize.Stacey Childress:For, as I used to say, not really my issue. I'm glad somebody cares about that. I do like the whales. It's not really my issue. Listen, I am all in on, as, you know, on jagged profiles, both as just a concept and as a common sense approach to how the world actually works. And again, I think that's a lot of what they got right, both in diagnosis and solutioning, or at least feeding into potential solutions, is there aren't enough choices. There are 4,000 institutions, but Diane, to your point, there are a handful or maybe four or five handfuls that are really kind of driving what good is supposed to look like, whether that's right or wrong, and then all the other ones trying to kind of look the best they can against that standard. I actually would be cautious about any one institution, no matter how large or small, how financially healthy or not. I'll be cautious about saying, do more programs, like, proliferate programs. Michael, like, you have spent some time both advising and teaching at the Harvard Graduate School of Ed Education in the last few years. And I think one really smart thing they've done is fewer programs. You know, let's have fewer of these. And so you can make more sense out of what a degree from Harvard Graduate School of Education means at the end of it, because you didn't have, however, I mean, there were literally like 42 paths or something, and it's down in the teens now. It's like a big step forward. And so I wouldn't suggest more. I would suggest more in aggregate. Right. And so to your point, Diane, what opportunity does it create for institutions to find their place in the ecosystem on the few things they can just be world class in, even if they're a smaller institution kind of in the middle of the country, someplace in a charming town, but not a destination spot. But they get really good at a few paths and us developing ways at the system level to let kids know about those young people, know about those options, these different places that you might go. And then the jagged profile, like, if you can have some services emerge for matching jagged profiles to institutions where you don't have to be one particular profile to do well there. But if you kind of fall in these ways, this is a way to continue to develop on these criteria you want to work on or if you want to look, the guys on the podcast saw college as a way out of being a bus boy and doing dishes when they were 17 or 18. Right. And so I don't want my jagged profile to be steady state, mostly filled in with things I'm interested in as a teenager and bus boy. But I do want some sense of where I am at that age and where I might want to push in if I'm interested in some other things. I mean, I want sports. So how does the ecosystem develop in ways that allows for, I'll just call it the supply of opportunities to be there in a very vibrant and differentiated set of options and some way of finding those options with a little bit of intelligence as a student and as a family about my student’s jagged profile. Right. I don't want my jagged profile to be driven by some of my immutable characteristics, like race and gender and presumptions about what I might like or not like based on that. But, yeah, I'm different from you, Diane, and from you, Michael. We've had a lot of things in common and a lot of things that are different from one another. And we always have. Everyone does.Certifying competence and personalizing through curriculumMichael Horn:Diane, can I, can I just one quick build off of that because it reminded me of two things. One, I loved it how the implication of what Stacey just said would solve the administrative overhead problem that you started with. Diane. I disagreed with their solution of just slash half the administration. You can't, as long as the bundle is what it is. And it's not a go back to operating like how you were in year 2000 because the world has changed. It's incredibly naive. And so that part of it, I think, where you just went with that, Stacey, is right. The other piece of this that just occurred to me is if you truly get good at the jagged profile piece, then a part I was in total agreement with Ben on was one of the biggest solutions, I think was starting the credentialing thing, if you will. That was actually certifying competence. And I think my conclusion, I've written a whole paper about this, about how we're never going to get to competency-based education unless there are these independent entities that are there to verify competency and mastery. And in practice, it's really hard to do. Like, we have all these one offs, right? Google, Microsoft, they don't stand in for the bundle. Once you get into the less rules based stuff, we get worse and worse at it. And so I guess I would just say if we solved it on the front end. Diane, I'm curious what you think, but we actually might build into something that could solve it on the back end. And that would actually lower the price, I think, of higher ed.Diane Tavenner:Yeah. Like, I'm bursting with things right now. So I'm going to do three things all here at once. One, I want to just add on to this, I think, this is a really important conversation. So here's what I would offer as a counterintuitive solution to what we've just been talking about that I know is true in the K-12 sector. So people think that in order to offer more choice and more personalization, that you have to do it in big structural ways. You have to add, like, a new major. You have to add a new school of something. You have to add, add, add. It's not true. The way you actually do it and reduce at the same time is in how you're designing those programs to be significantly more personalized, significantly more differentiated. So you're actually solving the problem of the horrible pedagogy.Stacey Childress:Right.Diane Tavenner:And you're not expanding the structure of the university. Now, this is so nerdy. Like, if you don't design education and whatnot, you would never know that this is how you do this. But Minerva is a perfect example. They literally have five majors, five degrees. That's it. Name me another university that only has five degrees. They've just exploded. But within those degrees, the experience is so hands-on, so project based, so differentiated that you can. People are really matching up. And so I think, actually, the path forward on that.Stacey Childress:It's super fascinating. And it is counterintuitive, because you're solving the scale system problem at the unit level. Right. At the unit of the learner and the learner experience. And it actually doesn't add overhead. It helps trim. It's fascinating.Diane Tavenner:It's my favorite kind of solution, which is, I call the kitchen tool solution. I have a small kitchen. I'm a big cook. I can't have that many tools. They have to do multiple jobs. So I love it as a kitchen tool solution. Michael, you also took us. So there's some other things we agree with which we might get back to, but I'm going to take us into the disagree, because you sort of led us there to this fixing the outgoing credential problem, which, look, I think we all agree there's a lot of disruption happening in society right now about these credentials. Right. And it's really unclear where they are, because last time I checked, all the elite employers are still hiring people from Stanford and Harvard. So that's super real. But you led us into their solution, and this might have been one of the most mind boggling proposals. And it falls into a category that's very natural for people, is when they don't know what to do, they think you need to do something different. They go back to something versus forward. And what Ben and Marc did was go back to the concept that in order to fix the credentialing problem and the lack of, we should start grading on a curve again. And I almost lost it, you guys. I had to take a break at that moment because that is the dumbest idea I've heard in a really long time. It's a horrible idea.Michael Horn:Nice of you to bring the nuance, Diane.Diane Tavenner:Quite frankly, they broke it down why it was a horrible idea. So I'll leave that to them. What is a good idea, and that's what we all talk about and what the three of us are driving for is competency, mastery based assessment and learning. And it's what you're pointing to, Michael. First of all, I just want people to understand this is a real thing. It's true. It's possible. There are competency based assessments that are valid and are reliable. More and more coming available every day. And in fact, one of the big problems is a lot of institutions don't use them. So we would have way more of these in the market if people were actually using them. And I say this because I built a whole system that does competency based learning and assessments. And now we had Tim Knowles on the podcast earlier this year, like, this is Carnegie Foundation for Advancement of Teaching and Learning and their partnership with ETS is all about this. So let us not believe that these things aren't possible and don't exist. They are and they do. And we as consumers have to start demanding them, buying them, using them, making them better.Michael Horn:Yeah, I mean, here was the big irony, right, which was, I totally agree with everything you just said, Diane, and I agree with them that the incentives currently suck, right. In terms of why there's great inflation and their credentialing idea. That's where you can go, right? Like we're going to have a way to prove mastery and we're going to say, yes, you got it. No, you got to keep working. Or you as an individual can say, maybe this isn't my bag. And that's okay. At this level, I think to learn what you really want and you're not going to make claims of, I got a C on this because I showed up and I turned it in and what, 30% all those…I'm totally 1000%... I thought the irony was that the credentialing idea that Ben wants to invest in, I think is an answer to this. I will add, I do not think that existing institutions, I know that many hundreds of them, are saying that they are launching competency based programs. I do not believe that most of them are going to be competency based. I do not believe that they are able to untether from the credit hour and move fundamentally to learning for the reason you just said, Diane, they're not using these assessments. They're not fundamentally able to move to a world in which learning is the currency rather than time. And I think this is where you have to have a third party credentialer and a new ecosystem of the Western Governor's Universities, the Southern New Hampshire Universities, et cetera, filled around them. Stacey?Stacey Childress:Yeah. Yes. I'm not going to yet take the bait on the discrete grading curve thing. I'll come back to that. I'm going to stay right here.Michael Horn:You were at the Harvard Business School where you had to.The role of employers in advancing competency-based gradingStacey Childress:I'm coming back to it. I'm coming back. I'm going to come back to it because I love this conversation or this thread. Supply can't continue to develop, proliferate, deepen, innovate without sufficient demand for the type of thing Is what you're saying, Diane. And so this assessment problem, it's more than an assessment problem, but it's an assessment infrastructure that supports a new learning model. That gets us to mastery based, competency based, enables us to do personalization more meaningfully. And this is where I think there was a miss on the solutions part, not about a specific solution, because I love the credentialing idea. We need a few of those. I think Ben and Marc pushing the onus of, or not the onus, but the point of leverage over to others to drive these reforms, I think, is short sighted because they have more power than maybe they acknowledged, and certainly as part of a business ecosystem in the country, have an enormous amount of power as employers to require something different of existing institutions and therefore open up opportunities for new institutions to emerge. New models to emerge. And they can do that, by the way they will and won't hire. And I know that's challenging because they need this flux of new talent every year, and they plan for it to be able to operate their models. But unless employers, it's a hypothesis, but I think unless employers really pressure the institutions that are currently credentialing students to do something different, it's not going to happen. Like, even the third party credentialer has a hard time taking off if the educational models actually don't prepare students well to demonstrate competency in the third party credentialing protocols. I think because it's a market challenge. Even though we're talking about higher ed and big chunk of it is nonprofit, it's still a market. And the output of the system is talent. There's a market for talent. Who's driving that market for talent? On the consumer, the buyer side is companies, and they're going to have to exert way more organized pressure than they do now. And I think it's absolutely doable. And look, there's a lot of one, I think I appreciate about just the podcast in general was they didn't really take the bait on super woke versus woke versus non woke. There were some allusions to it and stuff like that, which were fine. But there are employers making noises right now about who they will and won't hire based on current attitudes, behaviors, speech. And I don't love that, but I don't hate it. Okay. Employers can do that. Well, if they can do that, they can do this. They can do what we're talking about, which is a much longer term, more systemic way to really increase quality, overall quality of learning, quality of the signaling, quality of the incoming talent pool. And so like, yeah, businesses, let's get organized around hiring and not hiring based on some things that actually really matter fundamentally for the health of the economy, for human flourishing, et cetera, et cetera.Unbundling the role of the professor Diane Tavenner:This point about the power of the employers is in the section in my mind of what they sort of overlooked or their blind spot. And I think it comes to people, we often forget the power that we have. I'd love to come back to that a little bit on another example, but I want to stick here because one of their other solutions was to fix grade inflation. And this was like a solution that was so that they could make the credential more valuable and the value proposition. So it was sort of this adjacent solution to what we've been talking about. I will say they got into this whole conversation about adjunct professors versus tenure professors and all of this stuff about whatever. It was a little bit confusing. Here's what I would say about…I feel like fixing great inflation kind of misses the point here. I think the actual solution that they would be looking for and want is unbundle the role of the professor in higher ed, because that's actually the problem that's at the root of the issue. We see this in K-12 teachers have too many hats they have to wear. They're supposed to teach the kids, they're supposed to coach them, they're supposed to mentor them, they're supposed to counsel them, and they have to evaluate their work performance, and they have to recommend those. Mackle and I have talked about this for years. Those roles are in conflict. There's an inherent conflict in there. We're asking these people to play these two roles and then getting mad at them when they are trying to promote kids that they are deeply invested in and care about. And so I would say for that and many, many reasons, they love unbundling. I think they should drop down a level and say, like, how do we unbundle the role of the professor in higher ed? We've sort of failed miserably so far at doing this in K-12, but maybe it's more possible at higher ed. And I think this speaks to your idea of Michael, like, disaggregating the research piece. I just think there's so much opportunity on unbundling the role of professors.Michael Horn:Well, and I won't ding them for not knowing this, but this is exactly what Western Governor's University has done. They have unbundled the role of the faculty member. They have five different roles for faculty members. Life coach, course coach, instructional designer, I’m missing one, and assessment. And they're all separate. And it's one of the reasons I wonder, Western Governor's University has set up WGU labs. Might all of the expertise that they have developed in assessing competency, because they are a competency based institution, be something that they can spin out so other people can start building toward it and start to do this even more? Diane, I think it's a great. I'm totally with you.Stacey Childress:Totally.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Evaluating tutoring as an alternativeDiane Tavenner:Let me grab another one that I disagreed with, because once I get this one off my chest, then I think I'll feel okay. Which is one of their solutions was, and they sort of said it a little bit, like off the cuff, tongue in cheek a little. But we're pretty serious about it was like, look, if universities are charging $70,000 a year in tuition, if that's the price tag of a university, you could literally hire a full-time tutor. It would tutor your young person, know Socrates and Aristotle and sort of in that old one to one tutoring model. And they spent a lot of time talking about a study that we all know very, very well, a study done by Ben Bloom that showed the power of one to one tutoring. It's true. It's a real study we all care about. And I think they really lost a lot of nuance around that study and what it actually showed. And for me, a couple of things that were problematic on just the very technical side. You can't hire a tutor for $70,000 a year that is going to be Aristotle like, that is insane. And as business people, that's crazy. Please. So that business model doesn't work. And the second thing that really baffled me in the solution was their complete failure to think about scale here. We can't even find enough teachers in America. How in the world do we think we're going to scale one to one tutoring, even if we had the resources to do that? It makes no sense now. They were talking about, like, combos of AI, et cetera. Fine. I would say tutoring is not a solution to the problem of higher ed. It's certainly something we should be thinking about working on using as a tool in our tool belt, but it's not a solution.Michael Horn:I'll just say plus one. Go ahead, Stacey.Stacey Childress:Listen, I literally thought I'd gotten in a time machine and gone back to 2010 when we all started kind of professionally, really moving in the same direction when Bloom's study was the hot topic and kind of the talisman. This is the model for personalized learning. The two sigma problem is Bloom showed it's possible with mastery based one to one tutoring, which is a thing. Mastery based tutoring, like, it's a very specific model of pedagogy, which is a thing they miss, I think missed. So the two sigma problem is, how do we do this at scale? And they made a very good point. We all know what it's like. We all know the impact that one great teacher can have. And it's just a devilish problem to try to make a million great teachers, right? That's the challenge on the human front. And Michael, I know you and I share a perspective on this, like, Bloom's methodology, like, overstates effect size by. It took me a while to get there on my path over the last 14 or 15 years, but effect size is overstated. Algorithmic approaches to trying to get the technology to mimic that type of tutoring just really hasn't panned out. Lots have tried again. Hundreds and hundreds of millions of dollars of philanthropy and venture capital into that problem or goal. AI might put us on different footing there. You could really imagine something more akin in some domains to a mastery based model of individual support for young people that could approximate maybe some of the results. I don't know about you, Michael, but I'm skeptical of the two sigma, the 98th percentile result, moving kids at the 50th percentile reliably to the 98th percentile at scale. I think I'd take half that. If I could get 50% to 75th percentile in a reliable and affordable way, I think I'd be all in on that. What I don't think is that it is a single solution. It's always been my problem with this conversation about tutoring, which is it a thing that we're going to do on the side because other things aren't working. And so therefore, let's do one on one tutoring and that works for some kids and not others. And yeah, now we need 15 million great mastery based tutors who can each support three kids instead of just 3 million teachers that we already don't know how to do. So it starts to get at that challenge. But what I will say is what always continues to motivate me about the Bloom insight, whatever the effect size is, whatever the model is, whatever the scalability challenges are, it's twofold. One is isn't that really what we want education to be, regardless of how we actually operationalize it, whether it's Aristotle and Socrates today, but really some version of ChatGPT probably not going to happen, maybe not even all that desirable or through some other I'll just use the word bundle, even though I don't mean it in the way they were talking about some other basket of experiences that allow for the personalization you were talking about earlier, Diane, which technology can help and support, but isn't a point solution for it. I guess that's the thing to break out of, like when you see, well, one to one tutoring, and no matter what, it reliably shows this. And if we could just do that. I did think that listen, it was a cheeky aside that they made kind of as a joke, and it did make me laugh. But here's I mean, I do think this is a good push when we do get to the moment that there are as many administrators and faculty as there are students. And this is true in some institutions that the three of us know, love and give a lot of credit for helping us accelerate toward the wonderful lives we're leading. Now you start to say, can we really not afford it? Yeah, because maybe we can afford it. We're just not spending on it. And maybe the model isn't really one to one, but maybe it is one to one in terms of headcount. And then you've got this unbundling idea, Diane, that you were proposing and that I know Michael has talked a lot about unbundling the role of the instructor, the professor. So then you still have the same number of people, and maybe the cost model stays similar, but it's worth it. It's way more effective. It's way more productive because for the same amount of money, you're getting a 75th percentile result instead of a 50th percentile result. If we could just use the inspiration of the blue model, not say, let's try to replicate it exactly, but what might it push us to re-examine about the current structure and what might be possible if we weren't so wedded to the operational model that we have.Diane Tavenner:We could go.Michael Horn:I'm just nodding. I think this is a good point. I will say the irony I thought was they said nothing in education scales except for the Benjamin Bloom thing. And it was like, anyway, I've gone through my list.Stacey Childress:The problem is that it doesn't scale.Startup competitors in higher edDiane Tavenner:Let me just say quickly, because I think we're going to all be in agreement on this. As VCs, it was interesting that they were surprisingly skeptical of startup competitors. So competitors in the space that could be universities, if you will, new startup competitors. And they cited their major skepticism around what they call the accreditation cartel, which is not surprising because VCs kind of don't like regulated industries. For good reason, I think. I just would say quickly, I think they missed Minerva here. Minerva is literally a startup against the space that they're talking about. So we should just say that out loud. I would also say that…Stacey Childress:They did mention it.Diane Tavenner:They did mention it.Stacey Childress:Yeah. They didn't talk…Diane Tavenner:In a separate place. I just want us to know there are some really key people doing some work on accreditation that, if it's successful, I think will matter a lot. So we should just know that that's happening. And if folks are interested in that, I think there's people doing that, number one. Number two, who knows if it will pass in our federal legislation. But there's some work around enabling Pell grants. So these are grants for low income students to do shorter term credentials, which could get really interesting around different types of competitors.Michael Horn:Yeah, but I would agree with them here because I think as it stands right now, to launch Minerva took like $100 million to launch UATX took some godly sum of money. College, Unbound, Reach University, Quantic School of Business and Technology. They're almost the exceptions that prove the rule at present. And I think supply is so limited that that partially explains why costs have gone up writ large over the last many decades. And it is really hard to start something outside the system like the short term Pell you just referenced that is locked to accredited institutions. It is like a whole set of institutions aren't going to be able to use it. And so it is really hard to start something outside the system because you're competing with something that does get a subsidy and you don't. We at Minerva were accredited, but we've chosen not to accept that subsidy to this point. I think that's been the right decision, but I'm just saying it's created barriers to entry such that I think all the coding boot camps and apprenticeships and other promising sort of stabs at this have struggled. And so I actually thought their point was right. And I'll just name it like if Stig Lesley, our friend, colleague, his postsecondary commission accreditor does get through, I do think it changes the game. And that's probably where you're going with this, Diane. But I think at status quo, Ben and Marc nailed this I would say.Diane Tavenner:Don't disagree. And certainly my experience for 20 years in the K-12 environment as a charter school operator and is consistent with the rightful fears there. And as I look about at what sort of, even if initially wasn't blocked, what's kind of washed away over the time, it's a real fear.Stacey Childress:Yeah. I wonder, just kind of on this startup as kind of some version of a bundle, which is, I think what they're saying, right. It's like a competitive institution that has some version of the bundle. I wonder, Michael, is there some pseudo non consumption at a big enough scale happening in the Marketplace? So some of these kids we talked about, or some of these types of student profiles that we talked about earlier, that the current setup just does not work for and creates this enormous debt load and stuff. Maybe if you're not, Minerva's charter is to compete with elite institutions, as are some of these others we've referenced. But maybe there's more opportunity, if you really got clear about a student profile or two that is currently not being served at all or being served so badly that it puts them as worse than underserved, like negatively served, that there may be some opening for. Because maybe that kind of place, I guess the finances are still an issue, but what kind of credential does it need if it's got good partnerships with some set of employers or a couple of industries, for instance.Michael Horn:Maybe this is a cool place for us to wrap because I think to that point, Stacey, this goes back to the quote at the very beginning of the first episode that Ben led with on the quote unquote scam. What I might say is you got sort of two options here. One, you have an employer driven model, which looks a lot like apprenticeships, which Diane and I have gotten very excited about as an alternative. And it's learner centered, but it's actually employer centered as well. And that to me is the two things that actually I would anchor on in the new system, and I think it would get those incentives right, to your point. And number two, I think the other option is we're seeing players fill the non consumption. They're the Western Governor's Universities. They are the Southern New Hampshire Universities.Stacey Childress:Good point.Michael Horn:And then my co-host on my other podcast, Future U, says, well, why aren't more people pouring into this ginormous adult learning opportunity? And I think the reason is because we've said for profit, you can't play. And capital, as you know, likes to go where there will be a return. But number two, the incentives really suck for for-profit right now because they're incentivized to enroll. And we've seen that movie play out. And so that's the other piece of this, which is I would love to see the accredited players have skin in the game so that if your students don't get good paying jobs and are going to default on debt, that they have some penalty for that. Then you could open up the capital markets and then start to scale some different looking players against this because we'd be focused on the outcomes at the end of the day.Media recommendations Diane Tavenner:I love that, Michael. I agree. It's a really good place to wrap. We could continue talking about this for a really long time. I suspect 3 hours were offline. Maybe we should turn to, we didn't do this on the first episode, but we should do it here because we were listening to that podcast, Stacey. We always do what are you watching, listening to, reading, hopefully outside of, quote, business.Stacey Childress:Well, one thing I'm watching and listening to is spring training. So baseball's back. We're in full swing of spring training in Florida and Arizona, and so I'm drawing attention to there. But then I'm also listening to a novel called the Covenant of Water by Abraham Varghese, which I had not…I know it's been around a while, but I am totally into... It's like one of those multigenerational stories that I love. It spans 70 years, from 1900 to 1977. The author is actually the Vice Chair of Medicine at Stanford Medical School. So he's a doctor and writes fiction. And so there's like a ton of amazing stuff about the evolution of medical practice during those years. I'm loving. I'm on like chapter 19 of 87, and I'm so glad that there's that much left of it. That's how much I'm loving it. Yeah. So I totally recommend it. If you haven't read it, that's awesome.Michael Horn:Diane, what about you?Diane Tavenner:Well, I have read it and love, love it. So that's an awesome one. So folks who've been listening know that I'm on my way to visit my son in Scotland here pretty soon, and we've got an upcoming trip. And so in my quest to continue to learn about that area, I'm actually reading Adam Smith's the Wealth of Nations and David Hume's A Treaty on Human Nature. Please do not laugh at me. Sometimes it's important to read the primary sources I tried to mean. So when we were talking Aristotle and Socrates and stuff, I had to laugh a little and the human nature and the growth mindset. But I think what's more interesting is at the same time, I'm playing with a new AI application, like I know we all are, that supports sort of learning journeys for people like me who aren't trying to get a credential but are trying to learn. And I'm having a conversation with it about these readings, and it's giving me projects and quizzes and all sorts of ways to learn and interact with the material. It's pretty fascinating. How about you, Michael?Michael Horn:That's awesome. I have a few different directions I could go because I'm still on the tennis kick to parallel Stacey's baseball, but that's not where I'm going. Last night...So this is someone could figure out when we're recording these episodes. But last night we went to the Somerville movie theater, which is one of these old-fashioned movie theaters, to hear an author speak. Her name is Kelly Yang. She lives in the LA area. She's originally from China. She immigrated here when she was like five or six or something like that. And she's written many children's books, and my kids had read them, one or two of them. We left with like eight of them. She has a YA novel as well, but the one that I was reading was finally seen, which was what they had read. I'm literally like every chapter, I'm like sobbing. Now, that was not their reaction, but it works on many levels, I guess, is the point. And then her new book that she is launching, and that's why everyone filled a theater last night is called finally heard, which is the sequel to finally seen. And evidently it's about the perils of social media through the story of an immigrant family. And so it's all about how to be happy and extraordinary, which, as she said last night, can often compete against each other in our lives. I've been reading so much John Haidt that I was so thrilled that a children's book author would tackle this topic in a really fun, enjoyable narrative. I'm excited to read it once I finish the first book. But with that said, a huge thank you to our friend Stacey. Thank you for joining us, Stacey.Stacey Childress:Thanks for having me.Michael Horn:I will add a huge thank you to Marc and Ben for devoting so much time and thought to the challenges in higher ed, sparking our two reactions. And I hope that they'll listen to this, and I hope that they will take it in the spirit in which we are offered, which is really building on the foundation that they have laid for a really critical conversation for society, because, as they said, universities have all these warts, and they do all these important things at the same time. And we can hold both of that in our head at the same time. And just a last thank you to all of our listeners for staying with us on this longer journey than usual. But we hope we'll see you next time on Class Disrupted. The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber. 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At the beginning of the year, venture capitalists Marc Andreseen and Ben Horowitz of a16z published three episodes diagnosing the problems with higher education, offering solutions, and then answering questions. Six hours of audio on higher education is no small undertaking! Diane Tavenner and I were intrigued with the takes and wanted to react to them, deepen some of the analysis, and suggest some places where we felt they didn’t get things quite right. To help us, we welcomed Stacey Childress, Senior Advisor on Education at McKinsey, to the podcast for two episodes. In this first episode, we reacted to Marc and Ben’s diagnosis of the problems with higher education. Can’t wait to hear your reactions!The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Diane Tavenner:Hey, Michael.Michael Horn:Hey, Diane. Introducing the two-part seriesDiane Tavenner:Michael, we've both been listening to another podcast, and it's causing us all sorts of emotions. I have to admit, I laughed out loud at a few of the texts you sent me because we were both on a bit of a roller coaster while listening to the three-part, six-hour series of the Ben and Marc show on the topic of higher education. For those who don't know, we suspect it might be a lot of people who listen to class disrupted and are kind of from our education world, Ben Horowitz and Marc Andreessen are currently very successful venture capitalists at a firm called a16z. They founded that firm and lead it. They were both really successful entrepreneurs, they each come from software and technology backgrounds. Their firm has a really successful podcast, and then the two of them get together and chat about hot topics on this other Ben and Marc show. From what we can tell, this is a really popular show, especially among young entrepreneurs and folks in Silicon Valley. So they recorded these episodes about higher ed in January, almost immediately, we both started hearing from all sorts of people that we had to listen. And so we did. Things haven't been the same since. No, in all seriousness, there are at least two big opportunities that I think their conversation presents. Michael, I think you have some perspectives here as well. The first one is, for me at least, to practice what we've been trying to promote on our podcast for five seasons, and what I think we both deeply believe in, which is third-way solutions. Which implies that we don't fall victim to polarized positions and taking sides, but rather we really mine for nuance and extend grace to people in an effort to find win versus win-lose solutions. Especially to problems that we really care about. So that's the first one, and that's a thing I want to practice today. And then the second is simply to bring things we care about to a much larger audience and a more diverse audience. We can fall victim to only talking to ourselves in education. And I think we are both just honestly thrilled that Marc and Ben are talking about something we care very deeply about, and that tons of people who follow them are really engaged with the topic and thinking about how to rethink higher ed to better serve students in society. So that's just a huge opportunity.Michael Horn:Yeah. Look, I think you framed this well, Diane. I like the approach and the excitement that we have and that anyone would dedicate 6 hours to higher education, to education in general, coming from the backgrounds that they both do. I think that's a net-net positive. So, taking all that, we're going to do a response, in effect, to these 6 hours, and we're going to do it in two parts. So today's episode is going to focus on the first part of the podcast that Marc Andreessen and Ben Horowitz, Marc and Ben, if we may, released.  They dissected the problems facing higher education from what they called a systems point of view, and we'll talk more about what that means. We're going to now try to stay away from what they got into in the second podcast, which is when they started to go deep into solutions to what they saw as the problems. And yes, if you're listening, you're probably guessing it. We're going to do this in two parts. So the second episode for us will be mirroring their second episode, where they started to get into solutions. I don't think we'll get into the Q&A third episode that they did too much ourselves. We're going to do our best to be systematic. But I'll also say up front, they had nearly 4 hours of content in just these two shows. We are not trying to replicate that part of the performance, but we will try to bring the same level of nuance at least that we attempt to do in all of our other shows.Welcoming Stacey Diane Tavenner:Michael, I really appreciate the caveat, because they covered a lot of ground, and so we'll do our best to make our conversation accessible and meaningful, even if you haven't listened to Marc and Ben. At the same time, we also want to build on what they laid down if you have heard them. So hopefully, for those of us nerds in education, we're going to try to differentiate as best we can here. It's a pretty big task, and so we decided we needed some expert help. Michael and fortunately we have a very good friend who's the perfect person to help us think critically about the problems that higher ed today and the way its present form presents and to unpack solutions. So I personally am so excited to introduce our guest, Stacey Childress. Many of you will know Stacey, but for those who don't, Stacey has a very long list of experiences and accomplishments. So I won't go into all of them, but I will share a few that are relevant to the discussion today.So let's start with the fact that early in her career, Stacey was a classroom teacher. She's also spent about a decade as a software entrepreneur, founder, and leader. So right there, she's bridging two worlds that are critical today. She then became a faculty member at the Harvard Business School, where she studied entrepreneurial activity in public education. She wrote three books, tons of case studies, and articles. She was a very popular teacher who won awards from her students and the dean. If any of you have ever run into one of her students, you know how popular she is. She's followed that up as the CEO of the New Schools Venture Fund and Eridaf, which is a whole new research entity that they help to incubate and spin out. And just more importantly, Stacey's one of the smartest people I know, period and in education. She sees the big picture and can break it down like no one else. Everything I told you takes a backseat to the fact that, in my view, she does what she does because she cares so deeply about kids, and that's what drives everything. I’ve had the privilege of working with Stacey on lots of things for many years and have experienced firsthand how her heart drives her work to make things better for young people. So welcome, my friend. We are so grateful that you've joined us for this, what we think is a really important conversation.Stacey Childress:Yeah. Thank you so much, Diana and Michael, for inviting me. It's great to be here and really looking forward to the conversation.Michael Horn:Never say that till you're done with us, Stacey. Stacey Childress:Thank you?Michael Horn:Well I should say I was one of those students, so I'll add that. In addition to having known each other for years, and being friends, we should also just disclose, I suppose is the right word, that we all serve on the board of directors with each other. It's not just any board of directors. It's the board of directors of a new university, Minerva University, that I suspect we may end up concluding in the second episode tackles some of the problems that Marc and Ben outlined in their podcasts. I just want that to be transparent front and center, because we're not only going to come to this conversation as three individuals with expertise in education but also as three trustees who are wearing that hat, and are trying to rethink some of the fundamental tenets of higher education. So with that outline, with that out of the way, if you will let's dive in. In the first question, which I think is a pretty fundamental one, because in the first podcast, and Diane you helped pull this out. They lead in with Ben saying a very provocative line, and the quote is this. “We as a society are running a scam and ripping off a huge percentage of our young people with the clear expectation that they are going to get a higher quality job and being able to pay for college. But that is absolutely not the case.” So that sort of sets the tone for how they are tackling the problems facing higher ed. Diane, maybe I'll have you kick us off here rather than throw Stacey into the deep end. I'd love your take on Ben's first hot take if you will, but then maybe also frame it as a general gut reaction, perhaps, to their first show, where they delve into and diagnose the problems as they see it with higher ed.Reactions to Ben and Marc’s framing of higher ed’s problems Diane Tavenner:Michael, I think it's a really interesting place to start. It's literally where they start, and it's like a fascinating place for us to enter the conversation. Let me start by saying I wouldn't use the word scam because it implies ill intent. Being one of the people who's sort of in the system that is behind that comment, I know that I don't have ill intent. I know that most of the people I know don't have ill intent. So I wouldn't use the word scam. And at the very same time, I do think the evidence points to the truth of Ben's statement. Honestly, for me, that sums up the tension I feel in this opening teaser statement and throughout the entire 6 hours of the podcast.So this quote really does a good job representing it. I directionally agree with so much of what they talk about. I think they really capture so much of the feeling and the thinking and the conversation. I'm really challenged by how they say a lot of things because they can seem, and I don't think I'm being overly sensitive here. I think they can seem at times careless with their language and what they're saying and biased. We're all biased, obviously, but I think that really comes through. And so they're kind of how challenges me. What I would say is they get a few really important things very wrong. Given how many people listen and learn from them, that feels like, in the best case scenario, a missed opportunity and in the worst case, a setback for addressing a problem that I think we agree on and it seems like we all want to fix. So I'm thrilled that we're having this conversation and so many people are engaged because we need the entire country to feel compelled to transform education in America. And hopefully that gives a sense of like when we talked about a roller coaster in the opening. That's the feeling of the roller coaster of emotion I had while I was listening. Then I would just note one other really important element of their conversation, which is for the vast majority of the podcast, they're talking about elite universities and elite students and learners. While they don't say it explicitly, well they do a couple of times, but for the most part they don't. It's really important to note that what they're describing is really about highly selective schools. It's not a surprise. It's what they know. It's what they've been through. It's the people they know. But I think we all have to hold on and remember that there are 4,000 ish colleges and universities in America, and only a very small number of them are highly selective or even selective. So this focus on the elites is important because it's indicative of how our country thinks about higher ed and talks about higher ed. It's one of the big problems we have, because what ends up happening is a small number of elite institutions end up driving much of what happens in K-12 all the way through higher ed. It's really the tail wagging the dog and I think they embodied that in their conversation. So it's very real, but it's also something we need to be aware of.Michael Horn:Great way to set the table. We're not always going to agree on this, but I think this is like framing a lot of the mood of this. Stacey, let me invite you in here and sort of your reactions to the podcast. Also on Diane’s thoughts and that quote that they lead off with.Stacey Childress:Yeah, well, let me say I enjoyed all 6 hours of the podcast. I had a little less of the roller coaster feeling you guys are describing, but maybe because I wasn't in a text thread with friends who were listening at the same time. Like you guys, I did have areas I really agreed with and areas I was puzzled by and agreed with less. But listen, I liked it so much, I stretched it into 8 hours. I mean, talk about nerd because I went back and listened to the second episode twice. Here's why. I have enormous respect for what Marc and Ben have created in the world, both as entrepreneurs. I mean, the way we experience the web today is in large part because of the foundation they laid back with mosaic and then Netscape. And just the hundreds and hundreds and hundreds of entrepreneurs that they've helped create new things through their venture capital firm. So I was super jazzed to listen to their ideas for solutions and entrepreneurial opportunities that kind of match the problem statements they came up with. And you know me, that's what gets me excited. What can we do? What are those opportunities, especially entrepreneurial opportunities? I agreed with a lot of what they said in both of those episodes, first and second, and liked a lot of it. But I think they had some misses. Diane, you mentioned you felt like there were some things they missed. As I thought about it, I came to this idea that some of the misses might have a common cause or problem, which is, not surprisingly, they were often painting with a very broad brush. So a very broad, correct, but broad problem statement. So when you jump to solutions from that, it can be hard. So I thought their conversation would have benefited from some more, I'll just call it granularity. So I'll give you my big example of that, which is this value prop idea, Michael, that you started us with here. Ben's quote, which is value prop's broken. College is more expensive than ever. Students are taking on more debt than ever because it's widely available and super cheap. And then all the other bad things that happen. Value props broken, okay, that's in the popular consciousness right now. There's kind of general agreement on that. Also the value prop is actually not broken for some students. It's actually still working for a pretty significant segment of students, and it's not working for lots of different segments of students. So I think the more interesting question is who is it not working for and why? And therefore, what? So one example of who it's not working for. Students who aren't quite sure what they want to do, they go to the college that they match with, overmatch, under match, or it's just right. Then they end up in some degree plan that they didn't really think through and didn't get a lot of help with. They rack up all the debt for all the semesters, and then they end up with this degree. They may have learned some stuff, but the degree doesn't have any value in the job Marcet or not much value. So they end up wandering around underemployed, not earning what they should. That is a problem. It's a pretty significant segment of students for whom that's true. Well, that's a problem that kind of suggests all kinds of interesting potential solutions and entrepreneurial opportunities or institutional reforms, however you want to look at it. That doesn't really work in broad strokes, but would work for that segment. Another segment is students who go to college for a semester or three or five, they're taking on debt all along the way, and then life happens. For whatever set of reasons, and it's different for different kids, they don't finish. So they've got 20% of the debt, or 50% of the debt, or maybe 80% of the debt of the whole thing, and they've got nothing. In fact, they might have less than nothing, because at a very critical moment in their transition from adolescence to adulthood, they didn't make the most of a very significant opportunity. They started something and didn't finish. And maybe it's not fair, but life's not fair, and that's now something that has happened. So that's a different set of problems. You could start to think about solutions… So to say, value props are broken, let's think of solutions. Provocative, interesting, whatever. But if we really want to make progress, we really want to get traction and have some actual product Marcet fit for things we might create, having a better understanding is, I think, super important. I think that was a bit of a miss. Let me say one more quick thing, because we may or may not come back to this. There was this thing that kept building for me through the first couple of episodes, and again, I was loving it. I was driving through most of it. I had a couple of long car trips. So if I make steering wheel motions while I'm telling these stories, that's why. I got the sense maybe halfway through the second episode, it kind of crystallized for me. I wasn't sure if Ben and Marc have a developmental view of human beings. In particular young people, or more of a fixed view of well, they are as we find them so now what. Versus, especially for kids, there was a stretch where they, I'm going to paraphrase, it was kind of like, all right, people are different. Yeah, that's true. Young people are different from one another and that difference is largely shaped by when you're 16, 17, 18 it's largely shaped by your experiences up to that point. Kind of your family, your community, the culture you're part of and I mean that's just who you are. So now that you're coming to college, why would we make you be an engineer if what you're really immersed in is music? I was really all in with kids are different, they're coming from different places, they have different interests and skills when they approach the doorway, the threshold of college. So now what do we do with that and how might we make things better? Then it was like, don't make musicians engineers. I mean, again, I'm being provocative myself here but it made me wonder. I think there was plenty of evidence throughout, that they actually do take a developmental view of people and of themselves. There was just enough of these comments and anecdotes and that really matters. It's an assumption worth examining. Maybe you don't really hold it, but if there's some version of it that you're used to operating on and then you start entering solutions and potential entrepreneurial opportunities, boy, that could go sideways pretty quickly. So I think that showed up a few times but that's my example of it.Michael Horn:Those are great, Stacey. I think already you’re bringing some nuance to the conversation. It's interesting. I think I'm probably closer to you than Diane, maybe on my reactions to this. We're going to try to hold on to the solutions one. That was where I had more of a struggle and I started texting Diane more. There's some errors that I want to get into. I felt like I was more on the bandwagon with the growth developmental view versus a sort of fixed view. I agree that is something that sits there throughout the couple episodes. I felt like Diane's right that some of the things that they expressed, and we're going to get into this more, were not the best way to express it. They had this underlying view of human difference and leaning into your unique value that is very Todd Rose that I liked. And I think this is what Diane's speaking about, is that it spoke against, all the value of college is maybe in who gets admitted which is more about the elite schools and not the rest of it. So I guess where I came in… That gets into the nuance you just painted, Stacey, about different schools get different outcomes. Different students get different outcomes and so forth. I guess from my perspective, starting with Ben's quote, I heard the frustration in his voice. I think it's indicative of the mood of the country. I think there's a lot of reasons to be upset at it because the incentives fundamentally underlying federal policy and spending have not been around the outcomes. They've been around just getting the students in the seats. I think you hear so much anger and frustration, like, why are we spending so much effort to forgive student debt. Why didn't it work? But I think the other side of this is, If you still graduate from college, on average, not for everyone but on average, this is a good value proposition. Like it's all for most individuals. So that's sort of point 1. Point 2 is roughly 38% of students don't graduate from college within six years. You take on debt and you don't graduate. That is a very crummy value proposition.They don't get the value. As we're recording this, there was just a big spread in the Wall Street Journal about this over the weekend. There's a huge number who are underemployed when they graduate from college. What they mean by that is they take a job that does not require the degree that they just earned. There's considerable evidence that if your first job is one that does not require the degree, by job number five, you're still in a track that does not. That's not, okay. So that is where I think Ben's quote is right on. And we don't want to confuse the point that if you're a low income student and you get into an elite college or university, you better go. I will say the other one, and this is a sympathy one from me for them.I think it's really freaking hard to talk about higher ed in a coherent way. Look, I'm the disruptive guy, you know? Your office was next to Clay Christensen, Stacey. He got painted with this brush all the time. Everyone thinks that we have decided that all colleges and universities are going to disappear five years ago, and it didn't, therefore, we were wrong. As you all know, I don't think Harvard and Yale and Stanford are going anywhere. I do think a lot of schools are going somewhere. We're recording this on a day where Cambridge College just announced it's merging with Bay Path University in Massachusetts. It's just the latest, frankly, in England. So both of these things can be true.It is really hard though. In my writing about higher ed, I struggle with this all the time. To talk about which segment am I talking about right now. So I'm empathetic to that. I'll just throw out a few stats because I think it might be interesting to folks. 59 colleges in the country out of roughly 4000 admit fewer than 25% of students. That's it. When we're talking about selective schools, that's it. I will defend Marc and Ben on this a little bit. I don't think they're only talking about elite higher ed because Marc’s alma mater, University of Illinois, I think is like 59% selectivity. So it's a little bit broader. But I think what they are fundamentally talking about is the roughly slightly under 30% of students today who we would have called traditional back in the day. What I mean by that is that they're residential, they're full time, they're aged 18 to 24, they're not holding a job while they're in college. That's a shrinking part of the pie. And they sort of make that point, but then they don't fully wrestle, I think, with what that means. So it's not just elite exclusive, but really more that residential, quote unquote traditional experience. I'll say the other thing is, and we'll get more into this, I do think they're also talking largely about research based universities. We talk about how that's important. They're not really talking about community colleges or online schools or schools that focus over teaching. I think you nailed it, Stacey. This is why it's important to get below the average because your solutions will be very different depending on what segment you're talking about. Maybe I'll pause there for a second before I ask the next question I have in case you all want to… alright no.Diane Tavenner:No, Diane's like, okay, I think we should get into it. It's great. I actually think collectively everything the three of us have said really sets the experience that I was having in listening. And I'm excited to talk about how they framed the problem, which I think is really interesting.The roles of higher education institutionsThe Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Michael Horn:Yeah. So let's do that. Because at the outset of the show, and to frame that problem or problems, Marc posits that there are twelve core functions of a university. And I want to list them here because this was the framing for their diagnosis. And I thought there were some novel parts of this from my perspective. Number one, he had credentialing agency. So the degrees. Number two, the courses, the education that you take. Number three, they called it the research bureau. Number four, the policy think tank. Five, moral instruction. We'll talk more about that, I suspect. Six, they had the social reformer, which I don't think actually would have been something that maybe people would have pointed to a decade ago. But with the current news around Deni and a lot of the fervor over that topic at the moment, this is very big. I think right now, the 7th one they had was immigration agency. And so just to explain it for folks, basically the notion that higher ed is an attractor of international students, many of whom pay full freight and help make the business models work for these places. Number eight, they had sports league. Number nine, they had the hedge fund, which referred to the endowments. And I'm just going to caveat this up front, very few institutions have big endowments. Okay.Diane Tavenner:And they did acknowledge that later on.Michael Horn:But, yeah, number ten, they had adult daycare, which points to the residential point that they were talking about, that segment. Number eleven, they had the dating site, which also points to the residential piece of this. And then twelve, they had the lobbying firm, which I think referred to the fact that government funding actually sits underneath a lot of the higher ed business model in ways that I don't think are widely appreciated. And so it was an interesting set of points. So I think the question here is, in your view, if those are the twelve areas that they outlined, what would you have taken out? What would you add? What nuance would you add? What they get right. And for this one, Stacey, let's start with you.Stacey Childress:Yeah, well, listen, I like that they took a systemic approach like that, and that they took an operational approach. They call those operational areas or areas of operation. And I do think it helped in a good way, kind of categorize the complexity of these institutions. And I'll give them a little bit of praise for that because that doesn't just stay at the surface level and treat everything as kind of a black box. Like, let's break it out. What are these different roles or operational functions that happen in universities? And you asked what would we may take out or add to the twelve. Surprisingly, I wouldn't take out any of them. People who know me know I hate long lists. Like, I make fun of them. If a top ten list is good. Some people think a top 72 list is good, and so then you just say everything you can think of. And so I can be really hard on long lists, but I actually tried to break this one and felt like it was pretty good. You might be able to consolidate a couple of them, but in general it's a good list. But what I found myself doing, especially during the first episode, the problem identification and analysis was twelve is still a lot. So how might we prioritize these? And if we were to prioritize them based on what, to what end? And so I was like hungry for a pull up that was about purpose or maybe purposes, creating what value for whom? And then can you kind of bundle into some prioritization groupings, the different functions, but in general, I liked them all a lot. I know we'll get into this purpose question and whether you prioritize the student or some other actors, and can you design around that? But before we started thinking about how to talk about it, my in the moment reaction to the list was, I think this is good. Also. I think this is good, but I don't know which one would I put on the top three, because you cannot prioritize at the same level of attention and resources. Twelve things. And so I was thinking about that in terms of what I, well, before I say what I might add, you kind of called out the moral instruction and social reformer, Michael, and my reaction to those good. When they was listing them off. Oh, good, yes, let's talk about those. And then when we got to their discussion of them in the first episode, I felt like their categorization was super thin, maybe is the right word to describe it, like moral instruction. Just again, from a developmental standpoint, the years of 14 or 15 through age, 25 or 26, is like prime time for developing moral reasoning. And we can like that or not like that, but it's actually true. So if you've got tens of thousands of young people being adult, babysat on college campuses and you're not attending to moral reasoning, at least I think that's a big miss and quite frankly, kind of impossible. So if you're not doing it on purpose, it's happening. And so I heard their critique of what is happening and agree with it. I think random professors trying to impose their personal moral framework on young people. So advocacy disguised as teaching, I don't like it. I worked hard not to do it in any context, especially in the university context. It's hard to never do it, but I worked hard at not doing it. And so as an alternative to wild, wild west and what seems to be sort of what a default dogma and groupthink that ends up emerging. I'd rather a purposeful consideration of what might moral instruction mean if it weren't imposing a set of values, if it were instead attending to what we know kind of our inputs into healthy moral reasoning as we enter kind of mid adulthood. And then social reformer, we will talk about the DEI. I thought it was, again, shallow, or I don't mean shallow like dumb or craven, but like thin to only talk about DEI in that category. Because I do think. I think we have pretty some. We have agreement on this call. I think we have pretty broad agreement in society that education, including higher education, can be a real engine for social mobility for young people. And in that way it is engaging in a type of social reform which is the class structures as we have them, or it's at least possible for them to be permeable, right? And that education, like, it's the story of my life. None of my grandparents finished high school. None of them. My parents finished high school, but they did not go to college. But they made sure my sisters and I all could and kind of the rest is history. There are clear, accelerant benefit to the higher education I and my sisters and now my nieces are receiving. And that's kind of a social reform of sorts. And I think it's important to think through where that's working and not working. And as a design question, what might we do similar and different to what we're doing? And we got mired in the DEI conversation, which I do hope we talk about, because I do want to unpack it. But anyway, so thin categories, I would add major regional employer. I think sometimes we miss or forget that for a lot of these institutions, including the large and not so large state systems and other kinds of private colleges, just because of where they end up locating, they end up being one of the largest sources of middle and working class jobs in geographic regions, like they're a hub of the local economy. And when you start to talk about we're cutting at 20% or 50% and we're going after administrative costs, it's probably not the director level people that are getting cut. It's like the assistance, the administrative assistants and folks who work in the operations plant and that kind of thing. And so it doesn't necessarily mean you shouldn't take on administrative costs. I agree you should, but I think not acknowledging that in addition to all the other roles it plays in most communities where these institutions exist, they are a major, if not the largest employer. So that was the thing. I would probably add and think through the implications of great set of points.Michael Horn:Diane, why don't you jump in?Diane Tavenner:Yeah, I love that last point. And reminder about the regional employer. I didn't think about it until Stacey brought it up, and it's profound in terms of communities that these institutions are in. I just want to underline, highlight, exclamation point, what Stacey said about the moral instructor piece being fairly limited or thin. I think that maybe came because they drew on the universities, as many of them being originally founded as religious institutions, which seems really sort of somewhat disconnected from where we are today. It feels like there were some big gaps there in historical development and yes, about human development, the age range, et cetera. I was thinking about the language choice of social reform, and another way you could frame that whole category is just like, are we promoting and supporting the american dream? And that's going to appeal to some people in our polarized society, like social reform, some like the american dream. It's two sides of the same coin, in my view. In terms of my thoughts about the list, similar to Stacey, well, I had never thought about those particular buckets. And so it was provocative in a really thoughtful way. I was doing this side by side comparison of how I would think about k twelve institutions and higher ed and what's the difference? And do those buckets line up or not? That's probably a different episode, but it helped me kind of think through them. Plus, I was layering in our experience at Minerva, which is really interesting because Minerva is a modern university, very young, designed to address a lot of what Marc and Ben are talking about. And so many of these buckets are really absent from Minerva's operations. And the focus truly is on students, and I will know to steal sort of their punchline. I do think Marc and Ben make a compelling case that universities should, they believe universities should be focusing first and foremost on students, which I think is at least totally aligned with how I think we see the world anyway. So I was using those sort of experiences as I was thinking about their list, and again, couldn't poke a lot of holes in it and didn't really want to leave anything out. I did think adult daycare was interesting because we talk a lot about it in k twelve. We call it custodial care, but I hadn't made the direct connection to higher Ed, and maybe it's their sort of provocative title or naming of it that really makes us think that way. But it made me realize and think about the dramatically different experiences 18 year olds are having in our country when they go to a residential, sort of country club style four year college experience versus those who are literally going directly into work. Many of them will meet at home with families taking on huge responsibilities. And so there's just these really polar, disparate experiences, which is fascinating to me and connects back, I think, to what Stacey's talking about of like, we really need to segment and think about who's not being served more than this broad brush approach. And then I would know. They didn't spend a lot of time on the dating site element of it. I didn't get the sense that they personally dated a lot. So maybe that was it. But I will just say, and sadly, I think my experience is not that different from a lot of people, but I was raised to go to college by my mother to find a husband. And I'm old, but I'm not that old. And so that's just, I think, very real and prevalent. Yeah, interesting category. The one I would think about adding is what about something along the lines of like, Marceting, brand management and development, winning elite ranks and awards? It seems to me that universities are spending an extraordinary amount of time and resource on.Stacey Childress:So that's the only thing like reputation building and management. Yeah. That's interesting.Michael Horn:Yeah. Super provocative one, Diane, because when I think about that, I think of it as an outgrowth of some of these functions, but you're right, it's taken on its own life. Indeed, the story of northeastern university becoming a top 25 university is manipulating the US news world rankings like an outward, cynical, completely straightforward way to become a top 25 university.Diane Tavenner:Well, and my alma mater, University of Southern California, is maybe one of the first that really did employed enrollment management to this end, et cetera.Michael Horn:Yeah, it's a really good point. I will say, stacy, also, to your point about how there was sort of a lack of prioritization of the twelve, I think to some degree it actually wove into Marc and Ben's point, which is that there's so many different stakeholders here that that's why it's really hard to manage these institutions. I do happen to think that there is one of these that sort of rises above the others on these campuses, but we'll get into that in a moment. I will say, overall, I like how they pulled this apart. I've always thought and written about it somewhat differently. Mine has been that colleges and universities are essentially running three incompatible business models. And I suspect I'll get into the implications of that later. But the three I've always listed in the bundle are, number one, research, which I would view is what I call a solution shop business. Basically, we throw a bunch of stuff at a problem. We have lots of experts working on it. We don't know if there's going to be an outcome here or not. Some of it pays off, some of it doesn't. Right? But we hope so. Okay. The second is what I call the teaching. And they treat, colleges and universities treat this as a value adding process business. We ship in this class of students, I deliver the content, I ship them out the other side. And yeah, I'll leave it there for the moment. And then the third is what I call the social network, which is really a facilitated network business. It's people who participate in the network not for its own sake, but because they're getting some other value out of it. And my sense is that this is the one that Marc and Ben missed the biggest because, and I think it's a huge one because yes, they have the dating site and the credentialing function, but those emerge from the college's role in building social capital. And colleges are the original social network. I mean, Facebook started out by replacing the print Facebook on the Harvard college campus. And to me, a lot of these things, it's not just the social capital in your class or with the four years that are co living with you at that point. It's really across years. It's really why elite higher ed, in my judgment, the value is their exclusivity because you're part of the tribe. Human beings as social, we like tribes, we like comparisons. And so I think that's the big one that I would say I felt was missing from the list, even if it glimmers of, it sort of appeared.Stacey Childress:Yeah, I think that makes sense, Michael? Yeah. We can unpack some of the aspects of that social network that might come into play as you're thinking about solutioning towards better outcomes on some of these other dimensions, I think is really interesting idea. And I like your three buckets a lot. They're a little more manageable for me.Michael Horn:I think in threes, right. Is that better or worse?Stacey Childress:Right.Where they got it rightMichael Horn:But broadly, it sounds like we don't hate their list. We think that they got with some nuance that broadly speaking, it's pretty provocative and makes some sense. And I guess of that they diagnosed problems in each of those twelve. What in your views did they get right? And before we do the wrong, let's start with the right. Stacey, what would you give them the check Marc on.Stacey Childress:Yeah, I mean, I've alluded to probably most of these already, so I'll just tick them off. Like the value prop analysis that we talked about. Like, I'm not sure they're 100% right on all of the components of what's driving the problem there, but that actually doesn't matter. I think that they're right that for many segments of students, way too many. It's just not working. The promise doesn't live. The outcome doesn't live up to the know. I think they got right know just kind of appreciated both their take. Know some of your take, Michael, on the structural, like the economic structure of the field that's driving so many of these problems and how interdependent the different variables are and how difficult they are to disentangle and address independently. And I think they got that right. And of course that drives part of the value prop problem, but is a problem of its own. And I felt like they just kind of nailed that analysis as it relates to relatively well resourced schools. I think they missed, as we were talking about already some this other big segment of schools, the credentialing signaling function. Like, I'm glad they spent some time on that. There's some signaling about attending, as I referred to earlier, most of the signaling is on getting in and then also finishing. Unless you're Marc Zuckerberg, right? Unless you're Bill Gates or Marc Zuckerberg, where quitting is sort of your badge, like for everybody else, it's the getting in signal. And then I got through it. Signal that's so important. And Michael, as you I think so, pointed out so well a couple seconds ago, it's the first job, and more like it matters a lot for first job and second job, third job, fifth job. But it matters for a lot of other things that the signal is not just about fitness or readiness for a particular entry level position. It's also about who you belong with. And I think in that sense, there's enormous power and huge challenge that we ascribe so much signal or so much value to that signal. And it's real, it's shorthand for lots of stuff. And I have personally benefited from it. I am aware of the benefits of this signal, of where I got my graduate degree right, and it's enormous. While there were some things I disagreed with or a couple of things I disagreed with and some things that made me wonder and think hard about, which is good, I actually agreed with a lot of their DEI analysis, which may be a surprise to you guys and maybe a surprise to some listeners. So let me say why? What I think they got really right, and I think Ben really carried the ball, know, carried the torch here. The discussion about diversity, equity and inclusion needs to be grounded in some sort of purpose and outcome that we are aiming toward. And in this domain, our organizations, any organization, and in higher ed institutions, it's got to be anchored in talent. What is the talent we're trying to track to pursue? What opportunity or what opportunity sets? And how do we think about our channels into pools of talent that might not be naturally historically or naturally connected to us already? And how do we dig those channels, cultivate them, maintain them and make them matter? How do we create a climate and a culture of learning and community and dissent and learning where people want to be, people from different backgrounds that get to the threshold can find their way to thriving in our community? It doesn't happen by accident. And I think, as they well pointed out, that sometimes if you're only going for the box, checking in terms of characteristics and you're not doing the hard work of what happens when everybody gets together, that's a real problem. And I think we find ourselves in a moment where that's happening in many places. You got to do the hard work of removing any implicit or explicit bias that might, your admissions processes for students and your hiring processes for faculty might be laden with these biases that you just are unexamined and can be tweaked to make it more possible if you've got the great pipeline to see what you want on the other end of it without having to engineer quotas, right? I just think they're absolutely right about that. So let me just kind of sum it up and say when DEI programs, most of them are probably started with. I think we're starting with good intentions, maybe not all. I think most of them probably are. But when the design process makes its way into a self perpetuating bureaucracy that's in charge of it, that then has as its main function, because it's what bureaucracies are good at, compliance and control box checking, policing. That's where it goes wrong. And I think too many places are demonstrating what it looks like when it goes wrong. Not every place. I think Ben gave a great example of how they thought about a DEI strategy. They didn't call it that, but a talent strategy that prioritized diversity, equity and inclusion, even if they didn't use those terms to build the firm they've built. And that's a great example. Three of us have examples, too that we could name, and I won't. But it can go very wrong and in many places has, and I do not fault them in any way for being, I'll just say what courageous enough to actually have that conversation and say, here's what they see happening in some places. Now, again, I have some disagreements with the way they approached some of the conversation and where they ended up on a couple of things. We can talk about that later. But I thought that analysis of not in general Nadei program is inevitably going to get there. But, man, it sure can get there if you're not really clear about what you're doing and why. So I'll stop preaching.Michael Horn:No, that's a great set of thoughts, Diane.Diane Tavenner:Well, I will just say I really like Stacey's points and wish to be associated with them. I will just add to what I thought were big and important points that they made again and again that I really think are at the heart of the problem, the first being, and you alluded to this, Stacey, but the purpose focus of universities is currently so many of them not, I mean, really the rule versus the exception, quite frankly, is to not be focused on educating young adults and preparing them to launch into successful careers. And we talk constantly about the importance of k twelve having institutions having clear purpose. And our bias is that they must be educating young people to successfully prepare and launch into an early adulthood. And here's the next level. And they're not focused on that. And so I think that they just really hammered this point over and over and over again. And I really think it was at the foundation of what they were talking about and doing that feels really key to me and I really appreciate them for it. I think what they got to is universities have far too many competing purposes and they have far too many constituents in a very elaborate bundle of what they're doing that's evolved over time. And so to me, that was the big macro takeaway there in terms of the problem definition. I agree with it at the high. Well, let me just say, as you know, Michael, this season I've been reflecting a lot on the simplicity of running a company versus the school system. And I would say this is the perspective, obviously, that Ben and Marc bring. That is their experience and their expertise. And it really is very true to know businesses are more focused, they have fewer priorities, they focus their constituents, and we do not do that in education for good reasons and lots of things. But there's a real contrast there.Michael Horn:So those are my key that all lands for me. Stacey. I'll just quickly say maybe you're surprised. The de nine points you just made all lands with me as well. And I was largely sympathetic on the way that, again, there's some places where you want to set it that way. But I was largely feeling like, yeah, you got the big headlines and currents. Right. This is what I've been experiencing on the Harvard campus the last semester and a half. As a faculty member, I'll say, as a jewish faculty. So I think that was right. And, Diane, I also agree with you. They, I think, correctly say student ain't the central focus. Right. And that there's many stakeholders and the right one isn't being prioritized. I'll have a hot take of how to frame that. That'll be a little bit different from student centered later. So you all can yell at me then. But at the moment, I would argue it's largely the media. Sorry, the faculty, which I think is consistent with their view. And then they have some head nods to the media driving that a little bit as well. I'll quickly run down them research. They talk deeply about the replication crisis and that it's probably worse than we realize with a lot of fraud going on. That's consistent with what I'm hearing as well. Most of the research that gets produced isn't read. Much of it isn't useful. That's consistent with what I see. I agree with them. The incentives, I think, are really bad in the academy around this at the moment, around the publisher, parish incentives and tenure, and the federal government role in all this is stuff that I'd heard a little bit about. But actually, what they brought to it was somewhat new to me and made some sense. It was interesting, in any event, credentialing and know again the value of the admissions for lead, higher ed. And the piece of paper saying you graduate. Yeah, I agree with what you said there, Stacey. Sports league. This isn't true for every institution, obviously, but I do agree with Ben that for those places that are running big sports operations, it is corrupt and immoral at this point. And I have a major problem with it as well. And I like college sports, but I think we got to make some changes. Hedge fund. I appreciated the nuance that they brought to this one. It wasn't one of these, but look at the endowments. They should be able to afford everything. They were properly nuanced. The operating budgets of these places are huge. If you were allowed to spend every single dollar, you would wind through that endowment really quickly. Number one. Number two, most of the dollars are dedicated to certain causes or faculty positions or whatever else, and you can't just sort of spend it on area of greatest need. Immigration agency. I never, ever would have phrased it the way that they did, but I don't think that they were wrong on it. And then just last one, the growth of costs because of the bundle and the administrative overhead, being a big driver of it, in my judgment, they got this fundamentally right as well. Obviously, DEI is a portion of that. But I think fundamentally, when you run such a complex operation with pieces that don't necessarily go together to manage those pieces and be successful, administrative overhead rises. That's not just in colleges and universities.Stacey Childress:Right.Points of disagreementMichael Horn:That's everywhere. Right. The more product lines you have, administrative overhead rises. And so I think that's driving a lot of this. I thought it resonated. I might have been, well, we can talk about solutions later to that. Okay. But I'll leave it there and say if that's what they got right, let's get to the juicy stuff of maybe the important nuance that perhaps got lost or what they got wrong. We've already alluded to some of this, so we don't. But where would you want to take this?Stacey Childress:Yeah, let me name a couple of things. Michael, like you said, we've already sort of referenced, or at least I have. I think we all have some of the things. You know, Diane, you said a few minutes ago this thing about what we would love for the purpose of universities to be right is getting kids that next phase of launching towards successful adulthood, human flourishing. Right. Young people who are ready to thrive throughout their lives, live a good life, take care of their families, all of that. And they got that right. But there was this weird, maybe that's too. For Jordan, there was a strange thing, again, breadcrumbs throughout the first episode, a little bit in the second, where the assumptions seem to be that all too often, colleges are forcing kids into career and life paths that they don't want to be on. And I just don't think there's nearly enough forethought and. And structure and focus on helping kids pick anything totally. Well, let's be clear.Diane Tavenner:I'm starting a new company because we're just not doing this.Stacey Childress:Right anywhere. Right. There's like this side trip about Russia or Soviet Union create leading, kind of getting to gender parity in. Scientists and engineers were both same number or same proportion of men and women, which solved a problem that we still struggle with for people who care about that. And I was like, oh, this is interesting. Let's see where they go with this and where they ended up going with it was. It probably kept a lot of women from doing the things they would have preferred to be doing rather than being a scientist or an engineer. And I was like, I mean, maybe, I don't know.It could be. I kind of laughed and felt weird and all of that. But I guess the general point is, even though they did say got right, should be more focused on centered around students. What I felt they got wrong, sometimes explicitly and often implicitly, was over crediting the institutions for having some mechanism for helping kids move across paths that they might be interested in, so much so that they might be forcing them into pick ones that they were going to make a lot of money and hate.Diane Tavenner:I totally agree with you. I mean, higher Ed is, in my view, highly disconnected from careers and employment. And so it was very bizarre. Similarly interesting to me. And I think one place that they got wrong and one place that I was feeling a lot of emotion as they were talking was they seem to really like IQ tests, and they seem to think that the SAT is essentially an IQ test. And they find the move away from such tests really problematic in terms of the admissions process for colleges and universities, which we established at the top of that episode, is actually a very few number of them that are using those things to select. But here's what I would say. I just think there was a ton of nuance that was lost in their conversation. So let me just share a couple of things. For starters, the SAT isn't equivalent to an IQ test, at least in its current form, and just even at a superficial level, because you can study for it and you can literally raise and improve your scores with practice. And so by definition, it's not an IQ test for that reason. And this is a really critical nuance for folks like us, because we see very clearly how much the financial status of your parents gets conflated with the intelligence or giftedness. When people fail to recognize that this is a test, it's not a pure identifier of the smart kids, which it felt like Ben and Marc really seemed to want and think it is and was in this kind of nostalgic way, like identifying these unidentified, brilliant people out there. And not to say that we haven't all heard a story of that. Right? So they exist. I just don't think it's a systematic thing. I would also just add that the creators of the IQ tests, as I understand their positions and whatnot, and those who work on them, and honestly we just finished talking with Scott Barry Kaufman recently about this. They express real danger in using it as a screener for employment opportunities and things like that. And in fact, this is exactly what SBK was talking about. He's like, I went in to study these tests because I thought they were evil and discovered that they're not evil because there are real correlations and things that he didn't expect. But you have to be so thoughtful of how you're using them and take real care with them. And I felt like that was lost in kind of how they were sort of wistfully wanting to use them. And I will also just add that Marc and Ben seemed to be less than impressed with the actual education happening in universities. And so they talked a lot about the value being the selection on the front end, and then employers four years later using the signaling credential. I forget, what was the word that Marc kept like, that you completed? It wasn't persistence, but it was something like that.Stacey Childress:Conscientiousness, maybe.Diane Tavenner:It's true. It's true. But I was misty, like, wait, what's.Stacey Childress:Happening for in between adult daycare?Diane Tavenner:Right? And then they said this funny thing where they're like, we really need the colleges to do this. Or they implied this because we, as employers, can't give IQ tests because it's illegal. And so we need you to sort of screen for us. I was like, that was bizarre. I just feel like there was a lot wrong and confusing in that entire line of the conversation, which took up more space than I would have thought it would have taken up. And this is where I'm going to loop back to the points you all were making earlier about what I would call growth mindset. And do they believe that humans developed or is intelligence fixed? We're actually going back to some of the early philosophers that they've cited, and at some point, we'll get into one to one tutoring and how they were thinking we should be like Aristotle and Socrates. But I think it's a perfect example of.I don't know exactly where they stand on growth mindset. It wasn't clear to me, because a lot of the things they said sort of represented a fixed mindset view of humans. But then they have these real growth mindset parts. And so that's probably very know. Humans are. We're not one or the other. We flow in and out of those two states. Yeah, let me just leave that there.Michael Horn:Let's pause on the sat thing for a moment. Stacey, I think you have some thoughts on that. And then, Diane, maybe let's circle back rest of your.Stacey Childress:Like, I'm conflicted in this SAT conversation. Not like formally conflicted, but I feel conflicted. Not just in this conversation, like in any conversation about SAT or ACT or standardized tests of any kind, when we talk about them as a threshold marker of readiness. Look, I don't think those tests are perfect. In fact, they're way not perfect. Right. They're far from it. For all the reasons you said, Diane, and I won't repeat them all.I'm also a big fan of all the new forms of assessment that are coming into being and use. We can call modern forms of assessment that are more focused on what you're learning, like how you're progressing along a set of competencies, maybe from novice to mastery, or however you think about it, and kind of embedded in a learning environment rather than stop and take a test. I'm a big fan, as you guys know, of all of those. I have invested in lots of them that didn't pan out and some that are still in the works. And so I might be about to lose my badge of personalized, competency based forward thinking, but I just think we have to be realistic about what we're asking, what we're hoping for. When we ask a constituency like top tier employers like Marc and Ben are, and they represent lots of them, right, in their companies and in their colleagues at other venture capital firms and similar professional services firms, they have long seen those kinds of instruments as an indicator of something. Now, to your point, Diane, kind of agree they're not quite getting the nuance sense of what they do and don't tell you, but at least it was something that seemed independent in third party. And if we're saying you're wrong about those, don't even use those.We don't really have the thing to replace it with yet. Let me say it differently. We don't have the ecosystem to replace it with yet. We've got a lot of really interesting things happening, some things that are actually way far along, but none of which are totally market ready for broad, scalable, valid use that are also already adopted at scale. And so the alternative to don't use this thing that's wildly imperfect, but that you like, instead use nothing for a while while we figure this other stuff out. I actually think that's what they're really. Maybe I'm giving them too much credit. I think that's what they're really expressing as a frustration, not, I have to have an IQ test or give me the SAT because it does all the things it does and it's an IQ test.I think they're saying, I need something like, if you're taking those away, you got to give me something that validates what the threshold level of skills, abilities, competencies, ability to learn, ability to grow are, which I think is a little ironic since we're wondering about their growth mindset, belief. But so that's like, I'm not for or against standardized testing in the broadest sense. I have real challenges with them. And I also just from a change management standpoint, especially at the sector level or at the societal level, we can't just say, those don't work, stop using them. We'll get back to you in five or ten years and tens of billions of dollars later in investment when we have the things that replace it. So I think that my sense is that's part of what we were hearing from them. I don't know. Yeah.Diane Tavenner:What do you think about this, Michael? And I'm just going to say that they've had an impact on us because we're over the hour, Marc. I don't think we've ever recorded an episode that's over an hour.Michael Horn:No, I know. I've been watching that. So for those who are listening when.Stacey Childress:We keep this, if you're still listening.Michael Horn:You'Re still listening, we apologize. But on the SAT point, I don't want to get into the solution piece of it because I think there's an interesting strand here you could follow. But I will say my biggest frustration with the problems episode was where Diane was as well on the IQ point. But I will say what I found interesting about it and why I was so excited to keep listening is I think it's a very interesting window into how employers and companies are thinking. Totally is one of those places where interpretation can become reality. Right. If this is how they interpret the world, it could be right or wrong. But if they walk away from it because it doesn't matter now, I think they would argue back at us and say, well, high school grades are not helping people distinguish anyone because of grade inflation and et cetera, et cetera, I think they're right on that. I think there needs to be some objective measure to Stacey's point, third party measure. And I don't think the reason companies are dropping degree requirements has anything at all to do with the fact that colleges are walking away from the SAT. Those are totally independent phenomenon. And as we'll talk about, yes, employers are turning away from degrees on the front end, but they are still actually, in fact, hiring based on them, because HR managers are different from ceos. And they never got fired hiring IBM, and they never got fired for hiring someone with a. Like, the PR release on the companies is very different from the reality how people are still. I guess that's the other piece about it that I'd say. One other thing I'd love to point out before we start to wrap on this episode, which is they talked a lot about the increase in tuition, well, outpacing inflation. I don't actually think that's the story, because if you look at the last 15 years, if you look at list tuition, they're right. But if you look at net tuition, meaning after discounts and scholarships, it's not correct. Like, it's actually relatively flat over the last 15 years. And what I think is really going on is that spending, so, like, the cost structure of these places that is going up and up and up. It's why there was a whole decade of launching overpriced online master's degrees that made huge profit to basically hold up the other parts of the bundle. And then everyone of my higher ed friends say, michael, online is not lower cost. You're wrong on disruption. I'm like, no, because it's in a business model that's failing. Right. I think that was a very big thing that they missed, is that it's not tuition, it's the costs. And the reason the costs are going under is because of the are going up. Like this is one, the bundle, but two, it's because they're also trying to improve the. So, you know, when Stanford adds the high class dining facility, or actually I should say it the other way, right? Stacey, when Harvard Business School adds Spangler, Stanford Business School better respond, right? And so when one place adds the student success function or the DEI support or whatever, it is like, hey, the diversification of students, we got to support them. You better bet other places better respond. So it's the fact that these places have negative economies of scale. The administrative overhead keeps going up because of the bundle, it's expensive to manage and that they are trying to improve in their current paradigm of improvement, which we've all say we're not sure that they're improving against the right things, but that's sort of what's driving the fundamental cost structure that I think is out of whack is what I would say.Diane Tavenner:Yeah, makes sense. That makes sense a lot. I think we've covered a lot of ground, maybe as we do our listeners a favor and start to wrap here. I think one thing that really I spent a lot of time thinking about afterwards is with my, you know, educational systems leader hat on. One of the, my, one of my very first early board members, like Silicon Valley person said to me was like, look, if you are not as an organization or company or an entity growing, you're dying. Like there's only two states. You're growing or you're dying. And so one of the questions I kept thinking about is, what does it mean to grow as a university if you aren't increasing the number of students you serve? And maybe their argument is that all the universities should constantly be increasing the number of students they serve. And I think we would all engage around a conversation like that potentially. But if that's not real and true, how do you stay in growth mode without growing the number of kids you're serving? And so I wonder is that what has happened over universities, which are some of the oldest institutions in our society, fairly young society, but nonetheless, some of the oldest ones. And is that why they are such complex bundles with so many constituents, is because that was how they were growing, so they wouldn't.Michael Horn:No, I think that's really interesting. I think it points Diane to, again, a bunch of the colleges, elite colleges over the last 15 years have added to their class. Yale added 200 students per class. It cost half a billion dollars to do in capex.Diane Tavenner:Wow.Michael Horn:These places have negative economies of scale. And so I think you're right. That pours over into administration. It pours into research. I'll make the provocative statement. I'm glad that there's some institutions that are research first, but I think they should advertise themselves as such and not try to be all things to all people on the other part of the spectrum.Diane Tavenner:That's probably a good lead into because you've led us towards solutions. So let's wrap here and then.Michael Horn:Perfect place to stop anyone with what we've been reading or watching because you know what we've been listening to. And so we're going to stop there. And Stacey, thank you for joining us on this first.Diane Tavenner:Absolutely.Michael Horn:Stay tuned. Don't go far. We're going to have you back on our next episode. Thank you all for bearing with us and engaging with us on this episode of Class Disrupted. The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber. Thank you for subscribing. Leave a comment or share this episode.

I’ll admit it. This was a pinch-me moment. Getting to interview Guy Raz—host of the top podcasts “How I Built This” and “Wow in the World” and one of the pioneers of podcasting? Count me in.This conversation went in a bunch of unexpected directions. And that’s what’s so fun about it. After all, podcasting is all about bringing audio back and turning learning into leisure. And the question Guy and his partner Mindy Thomas asked a while back was: Why not bring kids in on the fun? Guy shared how his studio, Tinkercast, is leveraging the medium to inspire and educate the next generation of problem solvers. We discussed the power of audio to capture curiosities and foster imagination, how Tinkercast is doing that in and out of the classroom, and how it can help re-engage students in building needed skills at a critical time. Enjoy!The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Michael Horn:Welcome to The Future of Education, where we are dedicated to building a world in which all individuals can build their passions, fulfill their human potential, and live a life of purpose. To help us think about those topics today, I'm really thrilled we have Guy Raz, who is widely considered one of the pioneers of podcasting. Many of you are, I'm sure, familiar with his podcasts, whether it's, How I Built This, the kids science podcast, Wow in the World, TED Radio Hour, many more, we're going to get into all of that. Guy's also a bestselling author, and he's the co-founder of two media companies, including Built It Productions and the kids and family studio, Tinkercast, which we're going to talk about today on the show. Guy, just thank you so much for being here. I confess I'm fanboy-ing a little bit at the moment, but I'm just thrilled that you're here.Guy Raz:Michael, thank you for having me on and for being a fan. That's why I do what I do because, and we can talk about this a bit later, but every show, whether it's How I Built This, or Wow in the World, or The Great Creators, is I make it in the hopes that people get joy from it and value from it. So, when I meet somebody who says they're a fan, by all means, please. I mean, it means a lot to me, and I really love it and appreciate it, because most of the time, most of the week I am in this studio behind this microphone isolated from the world. I don't actually physically interact with people who are fans very often. So, thank you for saying that. Guy’s Journey to Podcasting Michael Horn:You generally get to ask the questions, so this is a little bit of a role reversal. But I want to start there on the personal side, where you just gave us that quick entry into... Because as I said, you host a lot of podcasts. I don't think I can keep count, I don't know if you can. But I'd love you just to tell your story, because I actually don't think a lot of people hear that around how you got your start in podcasting, the shows that you're hosting now, and selfishly how you stay on top of all the work it takes to do these podcasts so well with this level of excellence.Guy Raz:Yeah. I started in podcasting when it was a backwater, back in 2011. At the time, I was at NPR, I had been at NPR since the beginning of my career as a reporter at NPR. I was a reporter at CNN. Most of my early career I was a war correspondent. I covered the Iraq War, I covered Israel, Palestine. I was in Gaza, I was in the West Bank, I was in Tel Aviv, I was all over the Middle East. I covered the Iraq War and Macedonia and Pakistan. I mean, that was my life. I was in and out of war zones for most of my career. I covered the military and the Pentagon, which is for many people who know How I Built This and don't know my background would be strange to imagine, but that really was my life. I was living in hotels wearing bulletproof vests, I still have them, dodging bullets and explosions, and that was my life before I had a family.Eventually, I was a host on All Things Considered at NPR for a few years. I would say around 2011, I started to get a little bit disillusioned with news. It felt to me like the thing that I wanted to do with my life, which was to have an impact in some way, I didn't feel like I was having the right kind of impact. I didn't feel like... By going out in the world and trying to tell stories, the hope is that you will give people information that will help them build a more nuanced view of the world. But what I discovered, and it was a very naive perspective, what I discovered is that we humans generally don't operate that way. So, I wanted to figure out a different way to have an impact.What I landed on was that news wasn't the thing that I wanted to do anymore. So, around 2011, I started to transition out, and I ended up connecting with people at TED, the TED Talks people, and they were looking to build a podcast, build on a podcast that they had started but didn't really land in the way that they had hoped. So, they asked me to basically build a show, rebuild a show, and it was called the TED Radio Hour, and I launched that in 2012. This was a backwater era in podcasting. I mean, there were relatively few podcasts, comparatively few people listening. I had gone from being in All Things Considered, with an audience of five million people to a show with a few thousand.Fast-forward, about a year, two years in, there was a podcast called Serial, and that exploded in our culture. All of a sudden, a lot of people started to discover podcasts, including TED Radio Hour, at the time which was a show about big ideas. I would interview TED... People who gave TED talks. The shows were arranged thematically, so we would talk about creativity or curiosity or how we organize our lives or the vastness of outer space. It was this interdisciplinary show where you would have, in one episode, you would literally have Sting, like a rock star, Sting, and then a neuroscientist from Johns Hopkins, and then a former prisoner and an Arctic explorer in the same episode, talking about a broadly connected theme. That show gave me an opportunity to really explore ideas.What I realized having done that, doing that show, was that it was connecting with people in a different way. So, when I was a news reporter in Iraq or Afghanistan or the West Bank or wherever I was, I didn't get the sense that I was connecting with people in a way that was making their lives better. But all of a sudden making this show, that changed all of that, because the feedback that I was getting from listeners was, "Wow. This has changed my day," or, "It's given me a different perspective on the world." Or, "Now when I look up at the stars, I realize I'm looking at the past in real time." So, that experience really launched my career in podcasting. I eventually started my own production company, called Built It Productions, and started another show called, How I Built This, which I continue to do today, which is about entrepreneurs, founders of companies.Then around the same time, with a very good friend, Mindy Thomas, started a podcast called, Wow in the World, which we launched in 2017. Along with another friend, Meredith Halpern-Ranzer, we started a kids production company. So, that was really the beginning of my career. Since that time, I continue to do, How I Built This. I no longer do TED Radio Hour. That was an NPR TED show, so eventually I stopped doing that. But it was a wonderful experience. Today I host, How I Built This and Wow in the World. I do a show called The Great Creators, where I interview celebrities, musicians and actors, Tom Hanks, Stephen Colbert, Jason Sudeikis, Jeff Tweedy, Bjork, a long list of people, about their lives, about their creative process, about their failures. I try and create a space for them to show a more relatable side of who they are. Because whether you're an actor or the founder of Starbucks or me or you, we are all characters at certain points of the day or the week or the month.What I try to do on all of my shows, my interview shows, is to show a more stripped down side of people, the side of people that people might... The part of us that we might see in the mirror. I try and show that to my listeners so they understand that, many of the people they listen to and admire are like them in very many ways. So, my hope is that when somebody hears a founder on How I Built This talk about how they built Instagram or Starbucks or Tate's Cookies or whatever brand that we do, that they can see that there's a possibility there. That if it's something that they want to do, if there's an aspiration they have, they can hear and feel that through the shows that I'm part of, that I make, in the hopes that they walk away from it feeling empowered and inspired and maybe even changed a little bit.Creating Podcasts for KidsMichael Horn:It's fascinating to hear you say that, because inspired is the word that I wrote down as you were talking. It seems like you really help lift people up to believe that they could go chase that dream. In fact, as I said, I first got to know your podcast through, How I Built This. My wife, when she was starting her company, she made all the employees in the kitchen listen to it during food prep and things of that nature. But then obviously you really got into my radar with, Wow in the World, with Mindy. I, for a while was like, "Are you sure it's the same person doing both of these things? Are you really sure?" But I guess that's one thing that you were doing in both cases, which is inspiring and lifting us up to realize what is possible. But how did you see the through line from this podcast world that's largely for adults, entrepreneurs, to kids? Those on the surface feel like very different audiences and very different shticks.Guy Raz:Like any business, Mindy and I were trying to solve a problem that we had. I met Mindy in 2014, I was listening to her show on Sirius XM. She continues to have a wonderful morning show on Sirius XM. It's a kids program, that just blew my mind when I first heard it, because I had never heard somebody communicate with kids in such a funny, respectful, quirky way, in the way that she did. I mean, I was completely blown away when I first heard it. I, one day, Tweeted about it and she saw my Tweet and she freaked out. She was a fan of the shows I was doing at the time. Eventually we met and became really good friends, and she would ask me to come on her show to talk about news events with kids. Eventually, after a year or so of doing it, we were on a hike. I said to her, I said, "Mindy," I used to live in Washington DC and we were on a hike together. I said, "Why don't we make a podcast? I make podcasts. Why don't we make our own podcast for kids?"That was really the genesis of Wow in the World. What it was was we had kids, we both have kids. Now they're teenagers, but at the time they were little. We were really concerned about how much our kids were just staring at screens all the time. We were very careful not to give them access, but the iPad or whatever it was around, they were just like... It was like a magnet. So, we started to think, could we create an alternative, a screen alternative for kids that will be as good as a video, as funny, as compelling, as entertaining as a cartoon, except it lives entirely in that kid's brain?We knew we could do that, because both of us came from audio. So, that was really the genesis of the show. The through line between How I Built This or The Great Creators, or at the time, the TED Radio Hour and other shows I've done, and Wow in the World, was very simple. It was, if you give me 20 minutes, 30 minutes, an hour of your time, I am going to respect that time so much that I promise you I won't waste it. I will work so hard to give you something in return for your time. Whether it's really great, important information, really compelling entertainment, an inspiring idea, a thought that might change your perspective or trigger your creativity. Now, I don't hit it out of the park every time. I think it's impossible. But that's our North Star. So, whatever show I do, whether it's Wow in the World or How I Built This or Great Creators, that's our goal. That's where we recalibrate all the time.Are we giving people something to take with them? We're not asking for anything except your time, which is asking a lot. But if I'm asking for your time, I have to give you something additive. I don't want to make extractive content. There's a lot of extractive content out there, especially for kids. Unboxing videos or prank videos that really just needs those eyeballs to click up the advertising revenue. That's not what we wanted to do. We wanted to make something that was so funny and so compelling that kids would ask their parents for it, but wasn't just good enough to win over the kid but it had to win over the parent. We wanted something like Pixar, where you watch a Pixar movie with your kid and you get a bunch of jokes that they don't get. We wanted to make a show that spoke to kids and parents at different levels, and that was the genesis of Wow in the World, which we started in 2016 and then launched in 2017. The rest is history. You listened with your kids, which hopefully, I think, was entertaining for you as well as for your kids.The Magic of AudioMichael Horn:You bet. It kept me awake while I drove. We successfully got to the destinations, as I like to say. But I want to jump to where you picked up on this piece of the magic of audio specifically. I'd love you to just double click on that, because I think honestly, since at least as far as I can tell, since Sesame Street, people have seen video as the way to capture kids' imaginations, tell stories for learning, because Wow in the World is fundamentally about learning at its heart after you get through and learning in the best possible way, through stories, a compelling story that captures imagination. But I think it's fair to say you were one of the first to realize, hey, we can jump away from video into audio for children again. I'd love you just to talk more about the magic of audio. You've already explained how you saw the opportunity there, but just double click on that because I think that's a very important strand.Guy Raz:So, the thing about audio is it's like... Imagine, and you'll know this Michael, because when you were a kid there weren't any cell phones and there was no Snapchat, and the only way to communicate with your friends was over a landline. I remember when I was a kid, I'd get a phone call and I would take that phone and we had a long cord, long curly cord, and I'd take that cord down the corridor as far as it would go, and I'd find a closet door and I'd get in there and I'd have a conversation in the dark with another friend, so nobody could hear me. Those were some of the most intimate and powerful. Now, of course, you're a kid, but still memorable conversations. I can still smell the smell of the kitchen, the corridor. I could see the color of that yellowed cord, that curly cord.The reason why those were so powerful is because voice transmits, human voice transmits an infinite number of cues, emotions, feelings, that we don't normally take in because our brains are so wired to process visual imagery. But if you talk to somebody who cannot see, somebody who is blind, they experience the world sometimes in a richer way because they're focused on sounds and voice, and they hear the nuance of those sounds. Now, jump to Wow in the World. Essentially, what it does and what we wanted to do from the very beginning, was to create in a black box, which is, we'll call it whatever you want, a studio, the ether, a world in which anything could happen. You don't need CGI technology, you don't need multimillion dollar editing equipment. You can create the theater of the mind.You just need a microphone and some good writing and some good sound effects, and you can build any world you want. You can go in a submarine to the core of the Earth. You can go into distant space, you can go into a black hole, you can go back in time, you can go forward in time. You can ride a giant pigeon, which we do on the show. You can do all of these things because the visual platform is inside of a kid's brain. Every kid experiences Wow in the World differently. We know, I mean, this is not our research, this is published research, that audio, it triggers certain neurological reactions in the brain, essentially builds creativity because every kid's brain is imagining the story differently. Everybody sees me differently, Mindy differently, Reggie, Dennis, the whole world on Wow in the World. Yet every single episode of that podcast is rooted in a peer reviewed scientific journal article.We go through peer reviewed scientific journal articles, New England Journal of Medicine, science, you name it, and we find stories that we believe we can make accessible to children. We literally take high science peer reviewed science, and turn it into a cartoon for the ear. So, you will learn about why the vertebrae of a thresher shark is so incredibly complex, why it's one of the only sea creatures that can flip its tail entirely over its head to attack its prey. We take this research and we make a cartoon out of it with characters, with funny storylines. So, the hunch we had and what's been proved out, is that kids really learn science when they're taken into the story with humor, with fun, with this fantasy world, and they don't even know that they're learning. They don't even know that it's a lesson in real science. So, that was our theory and our hope. Then eight years later, it's been proved. Not just from the reaction of parents, but from even some of the research we've done with teachers and some of the classroom programs we've done.Michael Horn:Very cool. It strikes me that you're building on some of the best known pieces of cognitive science research around the power of storytelling on the one hand, and then frankly from my perspective, not overloading people's sensory. When you absorb information through a visual and auditory channel, they often can work against each other. You're just saying, no. We're going to ride one of these channels to make sure it really penetrates and that it is a much deeper impression and memory, which is really what learning ultimately is, is these building of memories. How (and Why) Guy & Co. Built This: TinkerCastMichael Horn: Then you've taken those insights and you've done it inside of a company Tinkercast, which is where I want to segue to. Tell us about the company and the range of activities it does, because this is then going to transition into some of the work you're actually doing, not just in this informal learning space where we all are learning constantly, but also in the formal learning space of schools and so forth.Guy Raz:So, from the very beginning, when Meredith and Mindy and I founded the company, we wanted this to be not just a sustainable company, but a full range kids and family entertainment and educational company brand. We started with podcasts and now we make several different podcasts. Who When Wow, Wow in the World, Two What's and a Wow. We've got other shows that we are working on. We've done, How to Be An Earthling, and several other shows under the Tinkercast banner. But we've also done live events. We create hundreds and hundreds of educational lesson plans every single week, based on every episode of our shows. That's available at our website. We have done partnerships with museums. We had a van that went around the United States, a Wow museum with hands-on activities. One of the things from the very beginning that we wanted to do was a create an educational technology platform that would enable kids to really hone in and really dive into this idea of audio learning, oral learning, in a way that we believed could be really, really beneficial to virtually all kids.This is a bit of an aside, and it's not... I qualify this because I don't have the peer reviewed data to back it. But anecdotally, from the very beginning when we started Wow in the World, we would hear from parents who would say, and I mean we have heard this now thousands of times, "I have a child who has attention challenges," or, "I have a child who has some learning disabilities," or, "I have a child who will not sit still, except for Wow in the World." There's something about... We would hear this, and we do hear this all the time. At our live shows, we sometimes meet these children, where the parents will say, "My kid won't sit still for anything, but this show captures something. There's something that keeps them listening and attentive." I don't know exactly what that is, but I do know that, and there is research that shows, that when kids learn through audio content and platforms, oftentimes they can comprehend things two to three grade levels above.Now, that makes a lot of sense to me because Wow in the World essentially is speaking to kids from age three to 12. Now, when Mindy and I started the show, we didn't really exactly know, but I think in our minds we thought we were talking to eight or nine or 10 year olds. But it turns out we're talking to three to 12 year olds, sometimes 13 year olds. So, a three year old might not get all the science, but you'd be really surprised how much they actually pick up, because there is sophisticated science in the show. So, some of these findings that we know about audio learning in the classroom or however, whenever kids listen to storybooks, we know that they have a higher comprehension level than they might if they're watching or reading something. That's really been proved out. I mean, we have seen that in just the range of kids who listen to what we do.So, as I say, from the beginning of the company, we wanted be where kids are, we wanted to be everywhere where kids are, and we wanted to reach them in every way and create content that was available to every kid, wherever they are, and their parents. We didn't want it to be good for you content, but it is, it actually is additive. It is educational, it is informative, but we didn't want kids to think of us that way. We wanted kids to think of us as something really fun and funny and exciting, and something that fires their imagination. Science was like the secret thing, the secret thing that was hidden inside of it.Tinkercast in the ClassroomMichael Horn:Very cool. So, you all have taken these podcasts, or I think what you're calling pod-jects, if I'm not mistaken. So, for those who didn't follow projects but pod-jects, into schools now with the launch of TinkerClass. I'd just love to know, I mean, you have this rich and formal learning world. You have the podcasts, you have all the events that you talked about, the van around the country, this listen, wonder, tinker, make ethos that could fit into design thinking in Silicon Valley, or it can fit in this platform you've created. Now you're going into schools with TinkerClass. I'd love you to tell us what this work is going to look like, and frankly, for interested educators, we get a lot of them tuning into the show, how can they start to connect and work with you all?Guy Raz:So, TinkerClass is the result of this journey that we took from the very beginning to build an educational technology platform. It is free for educators, and you mentioned design thinking. I mean, we essentially, inspired by places like Idio, we've created this project based, but pod-ject we say because based on podcasts, learning platform. Essentially what it is is, and you can find it at TinkerClass.com or go to Tinkercast.com and there's links to it. Essentially, it enables kids to listen to an episode of our show. So, you listen and then kids begin to wonder, they work in groups, they're incentivized to work in groups, and they're incentivized to succeed as a group. So, then they begin to talk about their wonders, then they begin to tinker. So, they'll use critical thinking skills to identify questions that they want to explore. Then they'll choose one big wonder to investigate, and then they will make. So, they'll collaborate, they'll investigate, they'll plan, and then they will present their findings on this platform.An amazing result of this long journey, we got a very wonderful grant from the National Science Foundation a few years ago, to build this platform out. Now, of course, we've got hundreds and hundreds and hundreds of real science-based episodes of Wow in the World and our other programs, to populate these lesson plans with. So, it essentially enables kids to build these 21st century project-based learning skills that are so critical. We've known for a long time that if we can grow kids into adults that know how to collaborate, they are much more likely to be successful adults. Rather than kids who don't know how to work in teams and don't understand the power of success as collaborators. Success in a collaborative form is what we reward in TinkerClass.So, we've now had several thousand teachers who have signed up. We have spent a few years doing some very intensive research around how kids respond to it. We have found that it has been incredibly impactful, particularly for striving leaders. Going back to something I said earlier, we found that kids can understand things two to three grade levels above when they are using the platform, because it integrates with audio. So, it's been a really, really amazing experiment, and now it's out there in the world available for free to teachers and educators. We hope they'll take advantage of it.The Power of Podcasts to Re-engage StudentsMichael Horn:It's incredibly cool to watch the evolution of Wow in the World and everything else, from these standalone things to now connective tissue, if you will, into the schools. I'd love to hear you reflect, I'm not a big fan of the phrase, learning loss, but obviously the disengagement of youth since COVID has been a real thing. Whether it's chronic absenteeism, struggling to learn, struggling to get engaged. Interestingly enough, I suspect you probably saw, we certainly saw it in our household and other places, that kids engaged more with these... Whether it was Wow in the World, or for my kids also, Mo Willems doing his drawing during COVID and things of that nature. All these informal things really bubbled, so they were still learning. But I'm curious, as you now plug into schools that are struggling to get that engagement again and to get that learning back up, how do you think that's going to help? How do you see that helping educators and helping students either get back on track or really plug in and get excited again?Guy Raz:Look, we are facing a future where we are going to need the greatest scientists, the greatest mathematicians, the greatest thinkers, to solve the biggest challenges that we will face as a species. Probably the biggest challenge we have ever faced as a species, climate change. Our hope and our goal here is to inspire kids to think in a big way. It doesn't mean that every kid's going to become a scientist or a physicist or mathematician, and that's not necessarily our goal. But we want to inspire kids to think critically about problems, how to solve them, how to talk about them in a collaborative way. Is this going to be the magic answer to the question? I don't know. But I think that based on what we've seen in the classroom and what we've observed with kids, we think it's really possible.We think that there's a real possibility and likelihood that this kind of approach, audio first with images too, we have websites and there are some really cool images on the screen, but an audio first approach that's funny, that's accessible, that doesn't talk down to kids, that gets them excited about science in ways that is mind blowing when you see it in action. I think there's a real possibility that this could have an impact. The question is, will teachers be interested in adopting it? I hope they are. It's free, it's available, it's out there. We're not asking for anything in return except making the promise that we hope... Promise, but trying to promise, that this will inspire kids and will get them engaged around some of the big questions that one day they're going to have to answer.What’s Next for GuyMichael Horn:Driving questions is obviously another great way to get people interested in learning to build solutions. As we just wrap up here, I'm curious. You do so much inspiring of people at different stages of their lives clearly, what's next on your horizon? We've barely scratched the surface of the books, live events, games we could talk about. But as you think about your own journey, what are you excited to do next and how can listeners and viewers stay tuned, so to speak?Guy Raz:I'm really excited to grow Wow in the World, and we have some other programs, new shows that we're working on. We've got some really cool toys and games that will be coming out over the next year. We are doing some really exciting things on my grown-up show, How I Built This. One of the things that I have not done and that I will be doing more of is video, is really talking about the lessons that I have learned over many years of interviewing founders of businesses. I have over 600 of these interviews. I think many business school professors would love to have the database and the data set that I'm lucky enough to have. While all of those interviews are available for free for anybody to listen to forever, I think that many of the lessons can be shared in different ways. So, over the next year or so, I hope to really start sharing many of the lessons I've learned as an interviewer, and as somebody who studies businesses, and also kids and even celebrities, to share some of those ideas with my listeners, and hopefully viewers.Michael Horn:Love it. We will stay tuned. Guy, thank you for continuing to inspire us all. Really appreciate it.Guy Raz:Thank you so much for having me.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber. Thank you for subscribing. Leave a comment or share this episode.

There are new solutions for work and learning, but are we, as a society, open to shifting from the familiar to seize these opportunities? I sat down with Ryan Stowers, Executive Director of the Charles Koch Foundation, to discuss openness in the sector. We lay down a definition for openness, look at shining examples of learning innovation, and consider the risk of holding to the status quo.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Michael Horn:Welcome to the Future of Education. I'm Michael Horn, and you are joining us at the place where we are dedicated to building a world in which all individuals can build their passions, fulfill their human potential, and live a life of purpose. There are very few people that I know who exemplify that more than the Executive Director of the Charles Koch Foundation, Ryan Stowers. He's a man who's a friend and has offered a lot of wise advice over this journey for individuals of many organizations over the years. So, Ryan, great to see you. Thanks for being here on the Future of Education.Ryan Stowers:Thanks for having me, Michael, and thanks for all that you do.Defining Openness as a Key Principle Michael Horn:No, you bet. I've been looking forward to this conversation for a while for many reasons. You all at the foundation have been working with so many entrepreneurs, educators, and employers, helping rethink, how we develop talent in this country so that all individuals can live into those ideals that I espoused up front. You know like purpose, and that businesses will also benefit in the process. So as a result, you get this bird's eye seat on all these cool journeys about how people are doing things differently from the way they've always done it. This will be the first of a series of conversations we'll get to have. I'll set the table because, over the past couple of months, I've gotten to explore a few of these principles with your grantees. The concept of mutual benefit with Scott Pulsifer of Western Governors University. And what I think you would call the broader dimensions of talents with Kathleen St. Louis Caliento of Cara Collective. I'm looking at your book that the Koch Foundation and Charles Koch Industries put out Principle Based Management. You have this other one in there called Openness - key principle. I'd love you to define what openness means to you and why it matters because it's one of those that I think on the surface, the word could mean lots of different things to lots of different people. And so it requires a little explanation.Ryan Stowers:Yeah, thanks, Michael. When I think about openness, I think the best way to define it is the free movement of ideas, resources, and people, and that generates knowledge, innovation, and opportunity. We think that's been critical to fueling progress in society, and we think it's going to continue to be important moving forward. So I think that's the best way to define it.Michael Horn:No, that's a good definition, and you couch it in that larger narrative of progress. In the context of learning and education and the workforce, what does openness sort of look like?Ryan Stowers:Yeah. And you and I have spent a lot of time on this. If you think of a system that right now, from my perspective, needs thoughtful consideration of openness, it's the work and learning ecosystem as we think of it. For so long, the focus has been on things like credit hours, seat time, and degrees, and it's not working. It's helping a select few get to the point where they can reach their potential, find purpose and meaning, and produce value for themselves and others in society. But for the most part, it's leaving millions behind, and it's setting a lot of people up for failure. So in this context, openness means, and you said this, you use the term rethink. Openness would lead us to consider that we haven't figured this out and that we should consider changing the way we think and act about work and learning to bring about better outcomes for all people with a recognition that we know how to do this. We've seen it work in other industries, we've seen it work in other spaces. We should put that kind of openness and innovation and a willingness to rethink or think outside the box to help us find better solutions for people. From our perspective, the answers are there. If we engage in this kind of openness and backing up a bit, you see it work at a societal level. A more open society is going to be one where new ideas are welcomed, where those new ideas are applied, and where progress is made. In the physical world, you see it like closed systems, they inherently stagnate and eventually fail. If you apply that to the world in which we're working, you can see how in the work and learning ecosystem, you've got more than three stakeholders, but I'm thinking of three in particular. The learner, the solution or educator, or the solution provider, and then the employer. Because so much learning occurs through work in our lives, getting all three of those stakeholders to think and act differently about how they engage in the work and learning ecosystem, I think, can bring about incredible results. So it's in that context that openness, I think, applies very much.Michael Horn:Yeah, I'm just thinking of so many things as you're talking that through, Ryan, because two of the things that hit me, I think of Glasnost in the Soviet Union, Gorbachev being like, we got to open up. We have to have new ideas. Then I think of the American entrepreneurial system over the last many decades compared to say a place like Japan. Our friend Clay Christensen would always say Japan disrupted the US economy. They played the game once, but then they had no mechanism of venture capital or laying employees off to create new companies that would come create that next wave of growth. As a society, it was relatively closed, whereas, in the US, we have some painful moments, but we keep having entrants come in and rethink and bring new ideas.Ryan Stowers:That's right.This episode is sponsored byOrganizing for OpennessMichael Horn:So it's an open society that keeps rejuvenating us over time. I guess the question is, so is it the existing organizations rethinking, or is it being open to new organizations maybe coming in and reinventing the DNA of a sector?Ryan Stowers:Yeah, I mean, I think it's going to require both. If you think of just the education system. Look at post-secondary ed right now. There are attempts. A lot of these attempts are well intended. I mean, a lot of these people are trying to help others reach their potential. Universities are, I think fundamentally they are. But if you look at the competition that new alternatives face in the post-secondary ed market, for instance, universities are getting $250,000,000,000 in subsidies to run their business. The anti-competitive forces that create an alternative to be relevant and provide a solution that will empower people are extreme. That's an example of where if we don't rethink what we're doing in the student finance and funding question, we could inadvertently create a more closed system than a more open system that would allow innovation. That would allow, to your point, new entities, new individuals, and new entrepreneurs to come into the space and try to make things better. And to have incumbents and people in the traditional space not view that as a threat, but view that as an opportunity to learn and adjust as well. So that's just one example. I think it's got to be a combination of both. The current actors being willing and open to changing the way they think and act, and then new entrepreneurs coming up with new ideas and driving and spurring that kind of innovation with the intent of creating a marketplace that reaches all learners in a highly individualized way to help them reach their potential. I think we can do this. Openness in ActionMichael Horn:So let's talk about your portfolio because you guys support so many interesting organizations. It's a compelling point you just made that both/and have to be part of this openness. Who's doing this? Well, who's doing this right, right now, that's really bringing in new ideas into the sector, exhibits that openness.Ryan Stowers:So just a couple of groups that are maybe on the side of the traditional approach. These are folks that you and I know well. We talk to a lot of these folks a lot. If you look at what Michael. Crowe's done at ASU, he's been open to considering culture change in a space that's been fairly resistant to that kind of culture change over time. Rethinking the role that the university plays in society in order to help more learners gain access to knowledge and skills they need in order to be successful. More open to bucking the one-size-fits-all kind of standardized approach to one that's more. You know, Michael would say this. I don't think Michael's figured it all out, but he's made some huge strides in doing so. Another one that comes to mind, you've interviewed him, Scott Pulsifer at Western Governors University. The fact that they take a competency-based approach to them, from figuring out where they can meet students and empower them to close the gap. To getting the knowledge and skills they need for in-demand jobs, that competency-based approach is highly innovative relative to where higher ed's been in the past. I think you're seeing the outcomes through the results that Western Governors is producing. Another couple that comes to mind that are maybe smaller and less well known but equally impactful is Reach University where they've gone in, and this is where you can bring the employer in, but they've gone into different sectors directly with groups that need to hire people, and they're not able to find people with the right skills, knowledge or aptitudes to meet the demand. So they started with K-12 teachers going into school districts and saying, hey, if we can identify dormant talent either through teaching assistants or substitute teachers who have… Some of them have 20-30 years of classroom experience, but they don't have any way to take that to the market and say it's worth anything other than giving them another role as an assistant or as a substitute. So Reach is going in and saying, how can we help that substitute teacher close the gap in a low-cost way to get them the credentials they need and then have the district recognize them as a fully trained teacher, able to run a classroom and teach students? And now they're going to nursing and manufacturing jobs. Reach University is a great example of what can happen when we take an approach based on openness and in this space coming up with a highly innovative idea that has the potential to unlock things in ways that otherwise wouldn't happen.Michael Horn:I love all three of those examples and for different reasons. I mean, the way Michael at Arizona State redefined excellence away from who you effectively exclude to how you can take anyone regardless of their starting point. How far can you take them? And then, Scott, obviously I'm a big fan of what Western Governors does with competency-based learning and fundamentally changing the measure of learning from time to actually what you've mastered. Then Reach, Mallory's,  longtime fan club of what they've created. It's interesting about the last one with Reach that required… and I guess they all do to some degree. It's certainly true for Scott and Western Governors as well. But that's an explicitly big change in terms of the connection with the businesses, the employers in this case. Her’s is school districts, but it could be companies. I guess the question is what's the downside for businesses if they don't embrace openness? Because I'm sure it can feel scary. It's upending the rules of how you have operated. Obviously, there are some great upsides in terms of dynamism and sort of innovating the future. But I can imagine a lot of the colleges or employers that maybe have hired the way that they have historically. They're like, yeah, but it's working for me.Ryan Stowers:Right.The Risks of Closing Off Michael Horn:What's the downside if they don't make the changes?Ryan Stowers:At a general level, we've seen examples of companies when they're unwilling to make changes that anyone looking at the landscape would say, hey, you need to change. So think of just out of the work and learning context for a minute. Look at Kodak, and remember, Kodak was the leader in their industry. At a time when they should have probably seen the writing on the wall, understood the landscape, and been willing to open themselves up to new ideas, new concepts, and new technologies. They shifted away from digital photography because they didn't want to threaten their profits from their film photography. And you think of the consequences of that decision. They were cataclysmic. For Kodak, they meant stagnation and eventually, ultimately failure. I think we're at a point where if you look at the US economy, you look at the number of jobs that are available and necessary in order to keep these companies moving, in order to help them produce products and services that make the world a better place, make people's lives better. Based on our current approach to talent, who and how we hire, and how we develop our people as employers. We've got a more closed system than would suggest is necessary in order to be successful in the long run. There are a lot of companies that are looking at changing the way they hire and changing how they develop their employees from a social impact standpoint. But I think what you and I are talking about is that they ought to be thinking about it from a business standpoint. For far too long, companies have relied on the proxy of degrees as telling them, for instance, what person they're finding in the marketplace and how that person is going to add value to their enterprise, their company. An over-reliance on something, sticking with the degree, in the long run, to help employers understand who they're hiring and what that person will be able to do in the company. This could be the Kodak moment for a lot of these companies because things are shifting. People are valuing things in different ways. There's so much fluctuation in the education market, the credentialing market. People are looking at skills now more than just degrees. From my perspective, they're not going far enough. How do we use technology and identify solutions that can empower employers to know exactly what they're getting when they hire somebody? Because there's a way to understand aptitudes and mindsets and gain skills and knowledge. To me, that has the ability to give a company a competitive edge in industries, especially where other companies are slower to respond in that way. To me, the answer for a lot of these companies, if they want to continue to be relevant, they'll change the way they think and act, and they'll approach all of their talent practices in a very different way. Understanding that their human capital, their talent, and their employees are the most important assets they have. Investing in them in ways that matter more to the individual, I think, is not just the right thing to do, it's going to be the competitive and smart thing to do as a business.Michael Horn:It's so interesting hearing you sort of develop that out. I get new things every time we talk about these principles. The one right there I got was actually openness, the opposite of it isn't just closed, it's a risk aversion. Right. In some ways, you often think of the HR function in a company as being very risk-averse. It's sort of the, no one got fired for hiring IBM back in the day.Ryan Stowers:That's right.Michael Horn:I like that Kodak moment language. You can almost imagine, I think, what you're arguing is you can stay with the same practices. You may have heard the Andreessen Horowitz podcast recently on Higher Ed where they were saying their companies don't just recruit from Stanford anymore because it turns out it's not a good predictor of success in the companies. So they're having to get more creative and look at different measures and assessments themselves on point because, in many ways, the degree is itself discriminatory and not very helpful to the companies. So as an HR leader, breaking out of those tried and true, quote, unquote, mindsets is important, perhaps to staying ahead of the curve, if I'm understanding you right.Ryan Stowers:Yeah, exactly. Look at some of the other problems they're facing. In addition to not being able to find enough people to fill roles, they're having a hard time retaining talent. In reality, the answer is the same. If companies will invest in people in ways where they're empowering them, where they're meeting them, where they are, we're seeing the data. I mean, paycheck and compensation matters, the commute matters, but so does purpose. So does meaning in one's career, even to the point where this younger generation seems to be willing to trade off some levels of compensation in order to find that purpose and meaning. A smart employer would tune into that aspect of the landscape and recognize that in order to stay ahead of the game, they've got to change their talent practices in order to hire the people that are going to want to contribute, to have that contribution mindset to achieving what the business wants to achieve. And I think that tweak is huge, Michael. I think it's going to matter a lot.Michael Horn:Yeah, I couldn't agree more. We're seeing the same data. As you know,  I’ve got this book that I've been working on, and the data we see on individuals trying to make progress as they switch jobs is that the paycheck, it stands in as a proxy for something.  It's a proxy for I want more respect or I have to pay daycare bills. So it's a proxy. It's not the root cause. We really need to get root causes and understand people's purpose and progress underneath it. To your point, as a whole individual, not just you at work. David Brooks had this piece recently on marriage being much more important than work for happiness. The Effect of Openness on IndividualsLet's end our conversation here with individuals. What's the upside and downside for individuals if they are or are not in places that actually support openness? What should individuals be looking for and thinking about?Ryan Stowers:Yeah, there are a couple of different ways you could talk about this. If you step back and think about openness in the workplace, think about the difference between working for a company where not just your input from day to day, whether it's making devices or transferring information or whatever your role looks like. Think about the difference between you just kind of plugging in and doing your thing, versus an environment where your supervisor or the people on your team or your employer generally respects you for what you have to bring to the table and is open to your ideas. Given your local knowledge about what you do from day to day versus anyone else in your organization, the possibility of you coming up with ways to make that better, or make that more efficient, or make it more impactful or effective, and that kind of empowerment approach internal to a company, or that kind of openness to the possibility that a leader doesn't always know everything that's best about what's going on in the company. The learner worker in this case is learning through experimentation, learning through trial and error. He or she is respected and given the chance to share his or her ideas and thoughts and know that they're impactful. That kind of empowerment and openness in the workplace creates a much better environment and one that people want to be a part of. They go to work because they find purpose.It connects up with what we were talking about a minute ago. It connects with their ability to make something bigger than themselves better and move forward. They've got a sense of ownership in that improvement. They've got a sense of ownership in that innovation. So I think it has a ton of potential to unleash things in people that, frankly, we just haven't seen in the past in ways that are much more empowering and much more effective for both the employer and the employee. This gets back to a different level of mutual benefit than I think we've seen in the past. There are employers figuring this out. There are employers doing things differently right now. I think Walmart's taken a huge step in this direction, focusing on lifelong learning, focusing on the merits of understanding who the individual employee is, what their aptitudes are, recognizing that if they invest in people in these individualized ways, they're going to be empowered and want to contribute in ways that are much more meaningful and important to the company than otherwise. I think you're going to see companies that take that approach gain a competitive edge. I met with an employer last week, Martin Ritter, who's the CEO of a Swiss-based company that makes passenger train cars. And his US operations here in Salt Lake City. He came to the US and recognized this challenge. They weren't finding talent at the level they needed to, with the right aptitudes or skills, through the traditional system. So he approached a local community college and built a program that allows juniors and seniors to come into the company, and get credentialed for what they're doing in conjunction with what they're learning through the community college, as well as what they're learning through this apprenticeship program. They're hiring people because the people are more connected to what the company is trying to do.They're more motivated to be a part of it. They were met in a way that the traditional system wouldn't have met with them. In fact, in a lot of cases, there would have been barriers preventing this level of access. So in this instance, it's an employer fundamentally being open to more risk and fundamentally changing the way he thought and acted about work and learning. That's leading to improved outcomes for hundreds of young people in the Intermountain West mostly in Salt Lake City, Utah. So it's just an example. And you're seeing this. You're seeing employers start to step up and change. And, you know, the reason they're doing that is they know that it's going to give them a competitive edge and let them be more effective. In turn, it's going to help unleash the potential in their employees and workers in people.Michael Horn:I love that case study, and it's a great place to end because it really is the win-win.  It's the positive sum as opposed to too often I think in society we sit there thinking, who's the loser in this? No, the individual benefits. The schools are certainly benefiting, and of course, the employer is in that example. Ryan, thanks for doing the work you continue to do and for joining us. We're going to find time in a few more months to catch up on what you're learning from the portfolio and continued evolution but just really appreciate it.The Future of Education is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber. 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