Kno's Brilliant Strategy For Transforming Education And Beating Apple

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The company started out making its own tablets, then changed to focus on software as the iPad and other competitors emerged. And though it began only focusing on college textbooks, it's made a major expansion into the K-12 market.

And now, the company's software includes analytics that let students see how they study, or, with permission, mimic another successful student in their class.

The company offers more than 200,000 interactive titles and its textbooks and education software are available all over the world.

The e-textbook business looks so promising that Apple jumped in a bit more than a year ago with iBooks textbooks.

We spoke to Rashid about why he decided to take on such a big challenge, Kno's decision to stop making their own tablets, his advice for entrepreneurs trying to change the world, and how his smaller company can take on a giant like Apple.

Edited excerpts of our conversation follow.

BUSINESS INSIDER: How'd you get started in the education business?

OSMAN RASHID: It's actually a very personal story. I was walking down the stairs of my house one day and I saw my two daughters doing homework on the dining room table and I had a flashback that I used to study exactly the same way almost four decades ago. Nothing had changed in the way that technology was impacting education. My motivation was to do something that would change the way my own daughters would learn.

But before I'd founded Kno, I was also the co-founder and CEO of Chegg which was in the college textbook space and we had come up with a new model to help students rent their textbooks so we could decrease the cost. It was a transition from just being a software company to coming into higher education then eventually into the K-12 space and changing how kids can learn, so it's been a transition over time.

BI: What's been your biggest challenge in taking on such an entrenched business?

OR: Two years ago I would have said that technology just did not deliver a good enough user experience that educators would feel comfortable using it in the classroom. But with the advent of tablets, smartphones, cloud computing, great user experiences, and really innovative content, the mix is now finally at the place where things are rapidly changing all around us.

The issue today isn't that educators or schools or students don't want to embrace it; they do want to embrace it. Now the question people ask is, "How the heck I'm going to (transition)?" The problem has shifted from "keep this away from me" to "I really want to do this but I don't know how." So we fought through the cycle of trying to convince people of where this could go. And we're really excited now that there are pilots happening across the United States and across the world. Change is here for education, there's no doubt about it.

BI: What's your value proposition to publishers?

OR: Today we actually have every major publisher as a content partner. So we've been able to make a great value proposition to them. At our company, we fundamentally think about the user experience from the student perspective. When you break it down, the student wants all of their content in one place and a consistent user experience, rather than going to every individual publisher's website. So the fact that we took the technology and we made a great user experience really helped the publishers see that this is a product students like.

Second we made sure that the burden of the transition was on us rather than the publishers themselves. Anytime you're in a big organization, and these are big companies, there are committees, there are processes and it's hard for them to react fast. So the publishers saw the value. It's a combination of technology, user experience, ease of use, working with the publishers. If the publisher has 10,000 books, trying to digitize and trying to do all of these things by themselves could take years to do. If they give it to Kno within a few days it's all done because of the technology we put together. That's where the value proposition comes in.

BI: What's the response been to your efforts to bring analytics to education?

OR: The response has been really positive from students, they love the fact that for the first time they actually can see their own study patterns. We are able to share almost hundreds of learning parameters with the students. But we sat down with them and asked, "What is it that you really want to know at this stage?" And they said they really wanted five important ones for them to get started on. And in many cases, this is up to the students and they say "Wow, I can see how I'm studying." And they love the fact that they can follow, obviously with permission from the person, somebody else from their classroom who they may admire for being a good student. The fact that they could mimic them and figure out how other kids are studying created an extremely positive response.

Analytics are so important to the future of students and educators that eventually when you think of technology and you have a student touching a screen and taking action: it could be to highlight, could be to do a problem, could be to make a bookmark, could be to take a picture, do a video, or do an animation. All individual analytics eventually lead to a great engagement experience for the student where content will begin to flow based on their own personal choices. We'll be able to tell in the future, "This student learns much better when he look at video versus reading content." With every touch you have a data point. Analytics, which is the future, will reach a point where it can really personalize education for every individual.

BI: You guys started out making your own tablet, right?

OR: Initially when we launched the company even the iPad wasn't announced and we believed that you needed tablets for education. And we were ecstatic that we were proven right. The good news for us was that we figured out that we didn't actually have to be in the hardware business, because the iPad and so many other tablets were coming out.

We said, look, the magic of our product was how to interact with a tablet, that was the ultimate goal, how do you change that? So we refocused on the content and how to change the user experience and how to make it multi-platform.

BI: Was it a difficult transition or did it happen quickly?

OR: You know, two months after we made the decision to shut down the hardware side and launched our app on iPad, we became the number one app in education. We had a lot of software already, an application, and we were always mobile focused, so our transition was very seamless.

BI: What advice do you give to people trying to found a startup or change an industry?

OR: I think the core thing that we all focus on is, if you close your eyes, can you see see your user using your product clearly? When we think of it like that, we see the student sitting in their room with a tablet, trying to study. What kind of experience have we given them? Only then can you build a company around the core use case. This is exactly what we want to do. So my advice is, do you really know the what is the one thing you want to deliver? For us it's a great user experience on education content.

The second thing is that you have to break borders down. I find that people do not ask enough questions of themselves and their coworkers.

And the third thing is, you have to really focus on something that you can influence. If you really focus on what it is that you want to change and really go after it, your ability to make a bigger change will come automatically.

BI: How'd you respond to Apple's decision to enter the market?

OR: It was a fantastic thing when Apple came into the market because it brought so much attention to digital content and digital textbooks. Today people in our company don't have to go and explain "What do mean by a digital textbook?" But what really matters is how much content can you make available to the students and the schools and what kind of user experience can you give to them? We are maniacally focused on education, even the small things that we do we keep the students in mind. If you take a standard app that you use for reading novels, and say you can also use it for reading text books as well, that's not going to work, because students study very differently.

There was an article out a few months ago where the the CEO of McGraw Hill had mentioned that they have yet to sell an iTextbook to a school because you have to redo all of the books from scratch.

And if you take a look at the catalog that's available in many of these dot coms, they have like 25 books available which are targeted at K-12. And with regards to education in general we have 200,000 titles, so we have the broad content. So I think Apple has done well in education. They did an awesome job on iPads. I think iPhones are going to make a big impact on education as well. But a maniacal focus on user experience for the purpose of education is what is needed. And that's what we do.

BI: As a serial entrepreneur, what have you learned about leading a company over time?

OR: So the biggest thing is: you have to maintain the same behavior whether the company is 10 people or 100 people. If you're scaling you need to figure out a way to cultivate a team of people who can help build the organization along with you. Can you cultivate a loyal group of people that you can trust to make good decisions. It obviously takes time to get there. If you hire B level people, they will hire C players. And if you don't have the right people making the right decisions then the company begins to lose over time. People say all the time that you have to hire the right people. You do need to hire the right people but also you need to let them grow with the organization and take some responsibility

Essentially you have to be aware of a crisis happening: "Can the company go on if I get hit by a bus?" That's I think how you build a great company and something that can scale.