Technology education startups are aspiring to be moderately popular in the last couple months. I have the pleasure to be surrounded by couple them. Recent comments by Bill Gates or the Kauffman Foundation stating that "Education is a more than $1 trillion market..." drive the aspiration of hundreds of entrepreneurs to enter into this market in order to make 100 millions of dollars. The most prominent and clearly visible markets they are targeting are the K12, University and Corporate Training/Continuos Education market. The majority of startups will try to get a piece out of these three spaces by offering some kind of incremental improvement. In the consumer facing space the improvements range from better & more learning material, to better methodologies, to more transparency and better learning management. An example for that could be the Kahn Academy with a great variety of tutoring videos or Knewton - they developed an impressive adaptive learning technique or schoology which is yet another learning management system with a little bit more functionality. Its an illusion that the education market will stay in these three markets and that the value chain will or should stay the same. But all the startups named above will certainly not help to change anything - they successfully help repairing the existing flawed system. The closest to being disruptive are startup like the School of Everything or Supercool School. Both of them democratize and decentralize the less rigid continuos education space by creating an entirely new education infrastructure.

The sad truth is that most people do not understand the meaning and mechanics of education at its core. I just recently met an entrepreneur who literally switched from building an ad network to starting a education company. There is nothing wrong with that. But if you see the education market as just another market where you can make hundred millions of dollars using mobile, localization and new funky realtime technologies - then you will literally improve nothing for anyone. The misunderstanding begins with mixing up the real need for education with the needs of our existing education market. Little understand the context of why and how our education system has developed over the last thousands of years to what we have today, what the implicit & explicit values or our current system are and why education generally is crucial for our society. Until you really understand - your perceived innovation will go as far as digitalizing content, fancy lms or using mobile phones and ipads instead of a blackboard. The disruption of education system requires the understanding of how learning really works and the awareness for the actual demand. I will write in more detail in the coming weeks about that. For now ...

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1. Lets kick it off with a definition :)

Education in the largest sense is any act or experience that has a formative effect on the mind, character or physical ability of an individual. In its technical sense, education is the process by which society deliberately transmits its accumulated knowledge, skills and values from one generation to another. Etymologically, the word education is derived from educare (Latin) "bring up", which is related to educere "bring out", "bring forth what is within", "bring out potential" and ducere, "to lead".[1] (Source Wikipedia)

2. Now look at your personal learning curve: When, where and from whom have learned the most in your life?

I personally have learned roughly

- 90% from my friends, family and people I worked with.

- 5% I learned in school, university, trainings, seminars, kindergarten, etc.

- 5% I learned from books, forums, blogs, various communities, wikipedia, ted, etc.

3. Now add five of my assumptions to that

1. content will be abundant and instantly accessible online
(wikipedia, quora, twitter, google, open courseware, itunes u, etc.) 

2. institutional certification will be replaced by community driven reputation
(linkedin, twitter, odesk, github, etc.) 

3. communities will become the core context and driver for learning
(github, hackernews, nexopia, bodybuilding, etc.) 

4. the half life of knowledge is exponentially accelerating 
(the amount of time that has to elapse before half of the knowledge in a particular area is superseded or shown to be untrue) 

5. the borders between learning, innovation and work are rapidly shrinking
(google 20% rule, ideo, etc.) 

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Why I feel our education system is long overdue 

As education has the purpose to prepare you for the labour market - let me start with that. Out of more than 50 people I hired in the last 6 years - I didn't hire one single person because of their university education - some didn't have one. I admit a CS degree from Stanford or MIT is a great indicator but it doesn't help my at all to define wether or not he/she is a talented engineer. Already today a great github profile or "10 five star ratings" for HTML5 projects on Odesk are way more valuable than a CS degree at any University on this planet. For a pr person a 100.000 followers on twitter are not just a way better indicator than any university degree they are also an invaluable asset for any company from the first day. I work with a couple of wonderful people on odesk that I chose based on their ratings, the chemistry and some sample work - one of them turned out to be a Professor from India another one is a young girl from the Ukraine that wants to become an actor. Both are doing the same work. 

I personally have learned all about how to build an internet business by following hacker news and living & working in the Silicon Valley for the last year. I doubt within the next 5 years there will be one university course that will even partially incorporate my learnings. But I am sure the learnings will be accessible to entrepreneurs in even in the most remote areas of Kasachstan through communities and online resources.

A good friend & one of the most talented and creative engineers I have ever worked with is a high school dropout. In fact from my experience good grades at a university generally tend to be more of a negative indicator than a positive. Top students were typical people who created massive social friction in my teams, under delivered and were very slow in adapting to change.
Long term studies have shown that almost 50% of the children that attend a school for retarded children in Germany are actually genius. All of you reading this know how painful & destructive school is for a free mind. Its great news that Peter Thiel  - a  respected Silicon Valley investor - decided to pay students under 20 up to 100.000$ to drop out of school and work on their own projects.  

Now - just for a moment close your eyes and imagine a world without an education system - no High School, no Harvard.
Imagine you would have to invent education for your children - how would it look like?

The frightening suspicion that may arise inside of you is that our traditional education system in fact already lost its entire fundament. Subsequently our traditional education markets are in fact really large bubbles that will not just burst within the next 10 years - they will burst, implode and shrink to a bare nothing of what they were before.

Of course this hypothesis sounds incredibly arrogant today and 99.999% of all mothers out there will not take their children out of school and to have them watch TED videos, work at odesk and socialize on irc and github. Although I would bet my life that the kids personal development would accelerate 10 fold being "home schooled" + they would be happier :) 

The illusion of the trillion dollar education market is unfortunately based on assuming that the existing market-size would simply transform and be taken over by new, more innovative companies. In fact the new education market will be deeply engrained into the evolving social ecosystem of massive knowledge sharing, collaborative work & online communities. Step by step the education market will become less and less distinguishable from everyday and work communication. If you want to empower and accelerate this process then you need to anticipate a completely new education ecosystem and value chain. For example there will be no market for monetizing educational content - all content will be digitalized in realtime and will be accessible or free. Education is inherently social and based on action - thats why watching educational TV is not an education but little more than a visual drug that keeps your brain busy. Content that is not embedded in social context is useless. There is also no value in optimizing the process of making people reproduce content if they can actually become content creators and build a valuable online reputation. 
Instead people are already today more than willing to pay to be part of "global learning community". The majority of the Schools on Supercool School are monetizing with member fees instead of charging for content. More prominent life long learning communities are Palomar5, TED or Singularity University that provide not only an intense learning experience through personal interaction & prototyping but also massive recognition. 

Finally - I guess the message of this is that you should think "out of the box" of the existing education market - if you really want to contribute to redefine our education ecosystem of tomorrow. If you are just in it for the money go ahead and contribute to keep status quo alive.

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Listen to Zizek explaining the hippocratism of charity.

He is elaborating the difference between proactive change and reactive relief. 

What do you think?

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"Social entrepreneurship is nothing new - it always existed and was most likely the major type of entrepreneurship before the industrial revolution since there were little incentive systems in place that suggested anything else than solving real problems in society."

Of course thats easy to say and it doesn't explicitly answer the question: "What the hell is social entrepreneurship?" Let me elaborate crabwise :)  

After the rebuilding of the second world war and the first massive economic upturn in western society we stumbled into a major identity crises that resulted in the 69' movement and also acted as the breeding ground of the growing perceived split between business entrepreneurship and social entrepreneurship. 

A social entrepreneur is someone who recognizes a social problem and uses entrepreneurial principles to organize, create, and manage a venture to make social change (a social venture). Whereas a business entrepreneur typically measures performance in profit and return, a social entrepreneur focuses on creating social capital. (Source: Wikipedia)

Michael Young amongst others was somebody who coined the term social entrepreneurship in politics to inspire and reward the "non business entrepreneurs".  In the 80ties and 90ties the brand "social entrepreneurship" became an uniting flag that led to a global movement to tackle substantial social problems in a sustainable way. Great!

Still, some may wonder doesn't a successful venture have to solve a social problem to be successful? Why else would anybody pay for the respective product or service? Tesla Motors for example ... they introduced a new electric car for the mass market - revolutionary! Would that be considered as social entrepreneurship, business entrepreneurship or maybe environmental entrepreneurship or technology entrepreneurship or everything at once - just to add some more confusion. I couldn't tell based on the definition provided by Wikipedia! 

Lets take a more "empirical" approach then. Based on the amount of mentions in the mainstream media  Tom's shoes could be considered a poster child of social entrepreneurship. They give kids in Argentina a pair of $1 shoes through local partners every-time you buy the same pair of $1 shoes for 50$. This way the kids do not have run barefoot anymore. The rate of kids getting hurt from broken coke bottels has dropped significantly since then. That makes Tom's shoes one of the top social innovator of this decade. Bravo! It may also revolutionize the global shoe business forever. Lets extrapolate from this example - it appears that social entrepreneurship seems to be a new name for a sustainable charity. Everyone at Tom's shoes does not just do good & can feel good but they can also pay the Stanford tuition for their kids - what a dream job.

Another wide spread definition of social entrepreneur is represented by this sentence:

“Give a man a fish; you have fed him for today. Teach a man to fish; and you have fed him for a lifetime”.

That of course doesn't fit with Tom's shoes anymore. Very confusing! 

Just for the hell of it - let me rephrase the fish quote based on another strong belief that people US & Europe seem to have: "Social entrepreneurship is about the rich helping the poor to become rich." That makes a lot of sense, doesn't it?! It also fits with our declared UN Millenium goal is to eradicate poverty by giving 0.7 of our GNI to the poor countries. By the way this would make Donald Trump the pope of global social entrepreneurship or at least the US welfare system. You may read his Bible on "How to get Rich" or this on how to become of "social entrepreneur". (Disclaimer: Donald Trump's real phrase would probably rather be "How to sell something that looks like a super duper fishing rod but actually isn't one and get rich while doing it.")

But lets get back to being serious: What is social entrepreneurship? Following a definition that I think may give more clarity on what social entrepreneurship really is. (Source: Skoll and FSG Report from 2005)

"We’re not giving people fish. We’re not teaching people how to fish. We’re trying to change the whole market of how we deliver fish to people."

(...) Social Entrepreneurs is the ambition to create systemic change by introducing a new idea and persuading others to adopt it. The Social Entrepreneur reconceptualizes the problem, seeing ways to prevent or cure it that have not previously been tried. Inherent in the definition of a Social Entrepreneur is this idea of finding a new way of doing things – viewing the world through a different lens, and working to change the attitudes and behavior of others to her way of thinking. This emphasis on a novel approach differs from ordinary nonprofits and non-governmental organizations, which usually work within existing approaches and conventions. (read more)

What is social entrepreneurship not ...

The preceding definition of social entrepreneurship would exclude algorithmic trading companies & social games on facebook. Both of these business categories are a beautiful example for the creation of perceived value vs. real value - or in other words monetary value vs. social value. It is really interessting to see how our society created a complexity around us that create incentives that are absolutely unrelated to the "real world". My hypothesis is with almost complete certainty that there is an inverse correlation between the rise of Zynga (a social gaming company) and the social value created. Feel free to convince me of the opposite! Algorithmic trading companies are more tricky at first sight. But even there - the numbers prove that the overwhelming majority of funds don't beat the index/benchmark - as you can read in this polite article. This basically means that no matter how sophisticated the algorithm and magical the intuition of your fund manager is - it is very unlikely that he actually contributes to the value increase of your personal investments on the stock market. Still he and everyone else who is part of this ecosystem earn enough money to potentially exchange their Maybach for a private Jet. Don't understand me wrong - I agree that trading, investing and gambling is a fun game to play - but I am not sure how valuable it really is. Maybe the frequency of financial crisis in the coming years could be a good metric to measure the great impact of the financial industry. 

Absurdly enough "social entrepreneurs" in the Silicon Valley will advocate gaming mechanics as an innovative method to solve our social problems. They might not know that gaming mechanics are not innovate at all. One of my favorite exemplars of a famous "social entrepreneur" who used gaming mechanics to do social good is Johann Tetzel. He started this game called Indulgentia in 1517 and became the most successful fundraiser of his century. He alone made the reconstruction of St. Peter's Basilica possible. Since then this house of god provided physical and mental shelter for millions of christians - how great. The secret to his success was a game that in a simplified version you could call: "Pay me or you will go to hell". Sounds like fun - he?! Actually it wasn't - it subtly destroyed the life of millions of people and it turned out to be one of the major reasons for the protestant reformation. I wonder if we could learn from the reformation as one of the biggest "back to the roots movement" the Western society has every experienced.

I think you might see where I am going with this slightly chaotic story. Lets do a test. Tell me if the following example is social entrepreneurship:

Imagine you would start a company today and use recycled paper to produce recycled toilet paper. You would sell the toilet paper for a premium price in the US and promise the customer to donate 50% of my profits to a charity in Africa that builds toilets. By doing this we will solve the problem of the overwhelming lack of toilets in Africa. (Please respond in the comment section. I am really curious to hear your opinion.)

Before ending I want to quickly digress into another comparison ... 

Just like in social entrepreneurship - the organic & bio movement has also led to a lot of literal visual mimicry. (Please read this if you don't know what mimicry is - nature can teach us a lot about ourselves). Whole foods is an example for a company that used the popularity of organic food to build a successful grocery chain. Up until now however I have not found any proof for the actual organic quality they claim to have neither in independent quality tests nor in a difference in taste. I do trust my tongue.

I am not criticizing any of the companies that are facilitating mimicry. At the very least "social/organic/bio marketing" could have a better social impact than most of the marketing money spent. I myself have been facilitating a number of rebrandings for small and large companies in Europe/Russia where suggestive charity as a marketing tool played a major rule. I don't have any moral issue with that as long as people understand that these "donations" are highly ineffective and are not guided properly. Also, they don't provide any sustainable change which is a basic premise of social entrepreneurship. Sometimes their effects may even be negative considering the local particularities of each economic ecosystem. Local business can be destroyed through unequal competition or local brain drain to the charities. (Disclaimer: I must admit that having experienced the absurdity of charities in Bangladesh I may be biassed and not totally objective.)

The best example of all for mimicry however is Corporate Social Responsibility. Following a quote from the CSR dean John Elkington:

On the limits of corporate social responsibility (CSR): “CSR for many companies has been framed as, 'We've got to be seen to be good [and nice], we've got to protect ourselves as part of risk management.' The increasing criticism of CSR flows from a recognition that even the best corporate social responsibility work is still peripheral and largely defensive. People are also beginning to realize that sustainable development is about creating new business and economic models which have the capacity to sustain a world population of 9 billion by, say, 2050. That's a much bigger and more disruptive agenda than most CSR experts are prepared (or able) to sign their companies on for.”  (Source: Drowser.org)    

Finally my plea ... 

Please be a more conscious consumer and help challenging mimicry by your choices.
If you want to start a new venture - do a social one that really has a fundamental impact on society - one that you deeply believe in. Doing something because it will make you look good - is not social entrepreneurship. To give you an example - no real social entrepreneurs will ever start his/her pitch with "... and then I saw all the suffering of these poor people and I decided to rescue them ..." and they will also not live in a nice house in the US while the problem they supposedly want to solve is in the sub sahara. 

We all have the unique opportunity of creating massive, fundamental and sustainable socioeconomic change from the bottom up in areas like education, work, finance, politics and of course most importantly water, energy and food. There is wide variety of technologies at our fingertips ranging from the web to biotech, ai & nano tech that make it not just possible but feasible. (cc. emergent transformation)

I want to end with a link to "The Top Moments of the Decade in Social Entrepreneurship" by Nathaniel Whittemore - who is a great social entrepreneur himself.

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