It is no secret that major changes in our education system must be considered. American students are not keeping up with the rest of the world, especially in math, science and technology fields, and more and more high-level positions are being handed to foreign employees. Technology has helped many businesses improve dramatically, as innovations almost always inspire growth. And according to Sebastian Thrun and his new startup Udacity, tech will be the future of education. Clearly many influential people agree, as Udacity recently announced a $15 million funding raise.
Thrun is no newbie in the field. He is counted as one of the pioneers of robotics and AI. He teaches at Stanford and was one of the inventors of the autonomous car that Google and Toyota are currently testing across the country. The $15 million Udacity just landed brings their total capital raise to more than $21 million in the last year. Current investors in the startup include Charles River Ventures, Andreessen Horowitz and Steve Blank, also a Stanford professor and a well-respected startup entrepreneur.
Although Udacity was launched as a for-profit education and technology company, the goal is to help people all over the world receive a higher education, even if they can’t pay for it. The company created their first online educational programs last year, offering courses in math, computer science and a wide range of other sciences. All courses are free, and more than three quarters of a million people have taken advantage since the beginning of 2012.
Peter Levine, one of the partners in Udacity investor Andreessen Horowitz and a Sanford lecturer as well, addressed this important need in a statement released this week. He referred to the educational disparity around the world as an issue of supply and demand. There’s no question that millions of people want to experience college education, but for most the expense of an American-quality university education is just impossible. Udacity will draw from its deep Stanford roots to inform the quality of the course content that will be made available. And no one will be left out of the loop. Levine will make sure that remains the case, as he will also serve on the Udacity board.
Udacity isn’t the only education and technology startup receiving significant support from the venture capital community. A pair of Stanford computer science lecturers started Coursera with $16 million raised earlier this year. Online tutoring service 2U brought in an additional $26 million this year to expand the degrees they could offer online. And Codecademy brought in $10 million in venture capital in June alone to help people learn computer programming. All told, educational tech startups received more than $450 million in VC financing to date in 2012, already besting the tally from all of 2011.
It’s clear that internet connectivity is the key. There are more than 1 billion smartphones in circulation, and almost 2.5 billion internet users worldwide. So it seems that if you build it, they will come. Whether it’s grade school tutoring or a masters degree in criminal justice, any educational service that offers value online will receive a long look. But how will these companies make money? For Udacity, the key will be employers paying to find talent through its network, or corporations looking to provide their current employees with specialized degrees and skill sets. At the same time, Thrun wants to make the process more fun. Users can expect interactivity and a game-focused style, transforming learning into a more enjoyable experience.