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America's public education system is a mess.
The U.S. is by far the richest country in the world, but our education system ranks a pathetic 17th among developed countries. American students, meanwhile, are ranked only 25th in proficiency in math, 17th in science, and 14th in reading.
There are many reasons for this sad state of affairs,* but an important one is this:
We have not yet figured out how to use our world-leading technology and innovation to increase education productivity and improve the learning experience.
Thankfully, a new generation of education entrepreneurs has begun to fix that.
Khan Academy, for example, grew out of founder Salman Khan's penchant for recording lessons on video in his closet and then posting them for free on YouTube. The lessons were wildly popular, and now Khan Academy offers a wide variety of videos that invite people to "learn almost anything for free." Codecademy offers online courses focused on a specific vocational skill--software development. Udacity offers cheap online college courses. Udemy connects freelance "instructors" with students across a wide range of disciplines. And Coursera and edX are partnering with colleges and universities to offer courses for free to millions of students around the world.
The next frontier in technology-assisted education is high school.
And, thankfully, here, too, help is on the way.
Drink Wine, Found Company
A few years ago, a Silicon Valley-based entrepreneur and investor named David Siminoff got bored with running a small hedge fund. In the evenings, as a side project, after downing a couple of glasses of wine, he began writing essays about some of the books he had read and loved in high school. The books were the same books that everyone reads in high school--The Great Gatsby, All Quiet On The Western Front, Ulysses--books that are often made impenetrable or ruined by the pressures of the classroom.
Early in his career, before going to Stanford business school, running several companies, and becoming one of the most plugged-in and successful investors in Silicon Valley, Siminoff had gotten a Master Of Fine Arts at U.S.C. Film School. Writing about books, he found, was a way of putting his long-dormant literary passion to good use.
Siminoff wrote a few dozen literary "guides" and posted them online.
And then, he says, with characteristic breeziness, "a million people just showed up."
By then, with the help of his wife Ellen, Siminoff had turned his evening project into a small non-profit organization, which the Siminoffs' daughter Sophie named "
Shmoop, Siminoff explains, is a Yiddish word that means "to move something along a little bit." Siminoff's grandmother would tell him to "shut up and shmoop me my chocolates." "Shmoop" was also Siminoff's nickname for his daughter as she shmooped along the floor in her diapers as a baby.
The Siminoffs' non-profit Shmoop was going to be dedicated to moving high school English education along a little bit--the "Khan Academy of literature." As soon as "a million people showed up," however, Ellen Siminoff got a better idea.
They would turn Shmoop into a business.
A founding executive at Yahoo, Ellen Siminoff had run several key Yahoo businesses back in the dotcom boom and then gone on to be the CEO of search-engine marketing firm Efficient Frontier, which is now a division of Adobe. Ellen had had plenty of experience in figuring out how to "monetize" online eyeballs.
David Siminoff
The Siminoffs: David, Ellen, Sophie, and Ben.
So while her husband drank wine and wrote about books, Ellen set about generating some revenue.
Figuring that smartphone-carrying high-school students might pay 99 cents for an app that made reading The Great Gatsby fun, she turned her husband's guides into apps. When the apps sold themselves, she hired a tech team to crank out dozens more, and she expanded Shmoop's web site. Then she "cloned" her husband, hiring and managing hundreds of over-educated, under-paid PhDs to write additional literary guides, as well as study guides for other courses and preparation materials for Advanced Placement tests and the ACT college admissions exams.
Eventually, a school system called and asked about buying hundreds of licenses for its students.
Then more school systems called.
Shmoop's guides and test-prep materials, which were priced at about $2-$23 apiece, were vastly cheaper than the traditional alternatives. They didn't displace teachers or force them to do their jobs differently. They just provided the basic background material, which allowed teachers to focus on teaching.
Importantly, the accessible style of David Siminoff's wine-inspired teaching guides also resonated with high-school students--unlike the boring formal-speak found in traditional study aids.
"It's hard for corporations to be intentionally funny and engaging," Siminoff explains, when asked why students like Shmoop. "We love the student. We speak student."
Shmoop
Hiring and paying employees required money, but the Siminoffs were enjoying running Shmoop as a family business, so they funded the company themselves (an option they had after two decades of success in a variety of investments and ventures.) Over the next several years, they invested several million dollars in the company.
Four years later, Shmoop has become a high school education juggernaut.
The company now has:
- 10+ million readers
- ~1 million paid customers
- ~50 employees and 450 contributors
- Single-digit millions of dollars of revenue, growing rapidly
- Courses and study guides for literature, history, science, math, writing, careers, Advanced Placement tests, ACT tests, and many other subjects
- Positive cash flow
There are about 13 million high-school students in the United States and a lot more internationally. So there's still plenty of room for growth in Shmoop's existing business. And a new crop of ~4 million high-school students (potential customers) enroll in school each fall, and the books, math, science, history, and other topics that they study don't change much. So Shmoop's growing library of guides and lessons--all of which it owns outright--should remain fresh and relevant for decades.
Government Regulation Spawns A Huge New Opportunity
And now, thanks to the combination of a growing acceptance of web-based learning tools as well as a new government initiative to standardize high-school course curricula, a new opportunity for Shmoop has emerged.
In an effort to make sure all American students have the chance to learn the same basic skills and information, the United States has established a new "Common Core Curriculum" initiative that will apply to most schools in the country.
This "core curriculum" sets standards for grade levels and course material, and it is highly standardized. Many states have already signed up and said their schools will comply with the initiative.
This hanging curricula--and offering hundreds of different and new courses--creates an administrative challenge for many schools.
And that's where Shmoop comes in.
The company is now developing 187 courses that conform with the Common Core Curriculum standards in each subject. And it is using the "MOOC" concept--Massive Online Open Courses--to allow schools to subscribe to and "teach" these courses cheaply and efficiently. (Shmoop's MOOC, not surprisingly, is called "SHMOOC." It's a nice complement to the company's SHMOOPSTERPIECE Theatre video productions.)
By partnering with Shmoop, high schools can comply with the new standards and be able to offer more courses than they would if they had to plan and teach the courses themselves. Again, the Shmoop courses won't displace each school's teachers: They will simply allow the teachers to focus on the most interesting material in class, and, in the case of niche courses, serve more as consultants and education counselors.
Siminoff offers the example of a high school that wanted to offer a course in, say, Victorian Literature. There might be limited interest in this course, and having a traditional teacher prepare and teach it would be expensive. But using Shmoop's course, a single teacher could supervise the few students taking the course--without having to dedicate a huge amount of time to the background preparation, teaching, and grading.)
"We can take any public school with six to seven English courses and give them eighty," Siminoff says. "We can provide our entire curriculum to every school at a fraction of the cost. If only 3 students want to take a course on Great Women Writers Of The 18th Century, we can allow the school to offer that. The goal is to offer a world-class education at the high school level, for students who are willing to make an extra effort."
Siminoff also emphasizes another key reason for Shmoop's success: The company partners with schools and teachers--it doesn't displace them.
"We apply technology to help schools do it better. They can offer more courses. Kids come to class having done the work. Teachers can focus on engaging discussion. Teachers can ask, 'what if?,' instead of just hounding the kids to do their homework. We handle the background. They do the interesting stuff. When a student has used our Gatsby guide, the teacher doesn't have to explain the book. The teacher can ask, 'why was Gatsby great?'"
As for tests--making sure kids do the homework and write their papers and understand the material--Shmoop's courses handle that, too. Students take multiple-choice quizzes online. If they don't achieve a certain score, they take them again.
Shmoop is launching its first Common Core Curriculum course, American History, in beta this month. Then it plans to roll out 2 to 10 courses a month starting in August until it has built all 187 that it has currently planned. After that, Siminoff says, the company will have planned another hundred or so.
So Help Is On The Way...
As many education entrepreneurs point out, our schools have been teaching kids the same way for centuries. Because the process is so labor-intensive, educators have resisted change, and the technology industry has never figured out how to crack the code, the education business has seen little of the technology-driven productivity improvements that have transformed other industries.
With luck, thanks to the new breed of digital education startups like Shmoop, that is finally about to change.
Disclosure: I have known David and Ellen Siminoff personally for two decades. I have followed Shmoop's progress over the past four years, from evening project to thriving business, and I think it's very cool. Because I think Shmoop is very cool, I was eager to learn more about it and write this story. If I had not thought Shmoop was very cool, however, I would not have written this story, for two reasons: First, because I don't like bashing startups (it's hard enough to succeed without some blowhard critic telling everyone why he thinks you're going to fail), and, second, because the Siminoffs are good friends of mine, and I would not have wanted them to be mad at me.
* America spends less on public education as a percent of total government expenditures than 17 other countries. Americans also don't hold teachers in the same esteem that other countries do (In Finland and Japan, for example, people honor teachers; Americans see teachers as civil-service bureaucrats who don't even deserve the meager salaries and pensions that they get.)