The education market remains inefficient and expensive. In this episode, founder, venture-backed CEO, public company executive and now venture capitalist, Anne Dwane, discusses building a company to empower people to realize their potential.
The education market remains inefficient and expensive. In this episode, founder, venture-backed CEO, public company executive and now venture capitalist, Anne Dwane, discusses building a company to empower people to realize their potential.
Over the years, she led teams in creating services that were loved by consumers and valued by institutions - schools, colleges, universities, employers and government agencies.
She co-founded GSV Acceleration Fund to be a catalyst in the world’s largest, most inefficient capital market: the human capital market. GSV Acceleration Fund backs entrepreneurs leveraging technology to fundamentally improve learning and talent development from K-12 through higher education and career advancement.
Technology is doing for our minds what machines did for our muscles; globalization, automation and artificial intelligence renders much of the $5T spent worldwide on education and training ripe for disruption. While learning has never been more essential, technology is making learning more accessible, affordable and effective than ever before.
Previously, Anne was Chief Business Officer at Chegg (NYSE: CHGG), with leadership responsibility for revenue, company P&L and M&A. During her tenure, Chegg transformed from a private, asset-intensive textbook rental company to a profitable public company with digital revenues of $140M.
Anne joined Chegg through the acquisition of Zinch, where she was CEO. Zinch enabled students globally to showcase themselves as "more than test scores" to be matched with colleges, scholarships and graduate programs. Previously, Anne co-founded Military Advantage ( www.Military.com) to connect service members and veterans to benefits, including GI Bill and career services. Military Advantage was acquired by Monster Worldwide (NYSE: MWW), where she became General Manager, Affinity Networks, leading a portfolio of businesses focused on lifelong learning and career advancement. Prior, Anne was in business development at Paul Allen's Interval Research Corporation and in brand management at Nabisco.
She holds a bachelor's degree in Marketing & International Management from Georgetown University and an MBA from Harvard Business School. Anne is co-author of Getting In: The Zinch Guide to College Admissions & Financial Aid in the Digital Age (Wiley 2011). She was named a Henry Crown Fellow of the Aspen Institute
(00:00) CXOTalk and wow every now and then technology fails us. I’m Michael Krigsman and we’re talking with Anne Dwane, who is a serial entrepreneur an amazing woman and Anne, briefly tell us about your background.
(00:17) Sure so I started my career in market research, which was in retrospect a really great place to start, because you really understand the customer you really have something to say. And then I moved into brand management at Nabisco, for Planter’s Peanuts which was an amazing experience. And I have been to nut school and learnered all about that. And then after that actually did some fun stuff at Nabisco in the very early days of the internet. And that was really my first experience with applying technology to make things better, faster, and cheaper.
(00:49) Then went to business school, came out and my friend from business school had an epiphany about community that could be connected with technology. And that was Christopher Michael who has been on this program and his idea was military dot com. And that was a way to really connect people who had served or serving now to all the benefits of service.
(01:11) And that was a fun opportunity to put technology to work, not just to make things better, faster, and cheaper but to really connect people to opportunities to learn and to succeed which is really a great purpose driven organization and that kind of inspired me for the rest of my career.
(01:30) Military dot com almost went out of business and that was kind of an interesting experience, but we with a great team brought it back from the brink and ended up having the company acquired by Monster, the jobs company and grew some businesses there. And then decided to go back early stage and join young founders who had a great idea to kind of revolutionize the college admissions process and make it a lot more friendly, and that was a company called Zinch and we grew that company and had the chance to work with a bigger company called Chegg.
(02:11) And Chegg is a funny name but it comes to a solution from the chicken and egg problem. And the chicken and egg problem that Chegg was out to solve was how do you afford college without a great job and how do you get a great job without college. And so how do you put those things together. And we were acquired by Chegg, grew that business with a great team. Went public with that process and transformed to a much more digital business from a heavily textbook rental organization. And just in the past couple of months I’ve decided to do the next chapter, which is moving from being an entrepreneur to being an investor. So I’m now a venture investor.
(02:55) Okay, so the common thread throughout all of this is the notion of community. When you were at Monster you said you we’re head of an affinity group, another way of say community. So what is the connection between learning technology and community, what has that thread been for you and what are you now investing in relation to this as well.
(03:26) Well so there’s a lot of things happening. So in one sense with technology like fast networks, and globalization, and automation, and artificial intelligence really knowing is obsolete. It’s all about learning. Constant change is here to stay. And technology is doing for our minds what machines did for our muscle. So it’s never been more essential to be learning, and a the same time technology is really making new things possible and it’s more possible than ever for learning to be accessible, you know affordable, personal, measurable right, and affective right, because if you want to improve something measure it.
(04:11) So technology I think can just make things fundamentally better. You know more convenient, more effective at a fraction of the cost. And I think that community elements and sometimes community I’d say affinity is important because affinity is about a couple of things.
(04:29) One is it’s not about being labelled by other people. Affinity is how you self-identify, and sometimes when we talk about affinity we say, well people show their affinity by what bumper stickers they put on their car. So it’s a cause, it’s their children’s school, it’s a college, it’s the US Marine corps or whatever it is. And I think that’s increasingly important that people choose to self-identify. And then also affinity is about shared purpose and interest which is a big motivator.
(05:03) And I think finally I think affinity is about relationships not transactions. And all of those things I think are important. And the other thing is there’s nothing in the world like a great teacher, right. A teacher can inspire, can ignite a kind of passion for learning. He tricky part is great teachers are not always available to us. And community can fill a bit of a gap in some ways of discovering what’s possible for you and also giving you a pathway to go and do it and the ability to ask questions. So I think that’s the intersection and it’s a pretty exciting time.
(05:45) There’s about $5 trillion that’s spent around the world on education and training today from K-12 education, through higher education and life-long learning and you know workforce training. And the context of all that new technology there are really a lot of opportunities for disruption and to make the skills that we’re building for or helping people build is just more relevant and at a fraction of the price.
(06:14) So when you talk about knowledge versus learning what exactly do you mean?
(06:22) So I think that you can know something and that can help you be affective and that is absolutely important. But what’s happening today is that knowledge often gets dated very quickly. And then the other thing is just because you know something doesn’t mean that you necessarily know how to apply it in a new situation. So then I think a couple of examples would be say technology coding examples, right, you constantly need to do that. but even ting sin communication right, social media didn’t exist 10 or 15 years ago, and if you’re not using social media you might not be making the most of the opportunities available to you and you may not be as relevant in the labor market.
(07:12) What about MOOCs and Coursera and EdX, where do they fit into this new universe and this notion of community and affinity group.
(07:26) Yeah so I think that the exiting thing is there are so many more choices for people around the world about how they learn and it can be based on how they like to learn, what they’re trying to learn etcetera. The beauty of MOOCs really is the Massively Open Online Courses is that fabulous teachers can be accessible to all. And Coursera has a really fascinating model among many other things, but some of the learning is generally free. And the credential if you choose to get it that validates that you took the course and have the competence is what you pay for. And that is a game changer for humanity in the sense that it levels the playing field and gives people everywhere that access to learning.
(08:19) We have a question from Twitter, Arsalan Khan asks can you provide examples of skills that have become obsolete and what are we being taught that is relevant.
(08:34) Okay great, good question, so I would say that some manufacturing skills are being changed by automation right and I think that idea that you would go into one company and stay there for your entire career and really not have to do a lot of training and workforce development over time is just not right anymore. The model has to be one that’s perpetually changing and learning.
(09:12) Things like creative or critical thinking are very applicable today. Communication skills, the ability to articulate a point of view and communicate that is really important. Another one is collaboration and increasingly especially in the workforce it’s a team sport, right. It’s synchronized swimming. Even when people are independent contractors right, they’re fitting into a larger human system and some of those skills are really important and they call them sometimes 21st Century skills.
(09:58) So I think at the core there’s lots of skills that are enduring right, and infact sometimes the liberal arts gets a bad reputation because they say it’s all about coding. But I don’t agree because if you actually think about the liberal arts as they were constructed, critical thinking, rhetoric right, which is communication those core fundamentals are good but all of us are challenged now to keep up with relevant ways in applying them to new situations. Good question.
(10:28) Yeah, so I’m particularly interested in Military dot com for two reasons. Number one, once you sold it to Monster dot com and now you’re in charge of affinity group what exactly does that mean and what did you learn. And then separately from the startup perspective Military dot com went through a very dark period, and you’ve written about this so I’m not airing some secret dirty laundry here and I’d like to know what you did to fix it.
(11:10) Okay good, well maybe we’ll take that one first because it’s a kind of fun adventure story. And you know it’s actually very relevant now because it was in 2001 when the economy really changed, and the dot com boom of the ’99 – 2000 eras abruptly stopped. And there wasn’t funding, follow on funding for startups, and just overall the economy constricted. And we had clients who weren’t paying us. We had clients who didn’t want to continue doing business with us. We had primarily an ad supported model and it was ugly. And I think that we were optimizing for some metrics like unique visitors and certain things that didn’t actually correlate to profitability or being cash flow break even. And you know in retrospect if you want to build a great business you have to be focused on the fundamentals, and at least have in your control the ability to turn the dials at any time so that you’re not reliant on external capital.
(12:24) So we had to learn a very tough lesson. We had to you know reduce our workforce which was very painful to do and we had a great team and it wasn’t reflection on them it was on reflection that we needed to trench, and then we needed to go and sell our socks off and make sure that there was revenue coming in. and that’s always a tricky thing because literally we would go out to sales calls and the advertisers were folks like AT&T or USAA or you know car companies and things like that, and you really couldn’t let on and if they did fine that we couldn’t make payroll.
(13:06) And I think you kind of have to dig deep inside yourself and the confidence to do those meetings comes from not suppress or anything like that. it comes from kind of the conviction that this was a good idea and it should exist in the world and it was providing a valuable service, both to the service members of the veterans that we served and for the advertisers.
(13:31) So I think that’s the secret and you know we had to be really disciplined in our approach and that really is an important lesson for an entrepreneur is that a lot of things is nice to do but you’ve got to figure out what’s essential and what’s the right sequence.
(13:51) So you made a very interesting point. You said you were focused on metric such as visitors. So you were in this situation, what was the metric that you shifted to and how were you then when you went off on the selling effort, how were you then able to convince sponsors or advertisers and what was your model. How did you convince them to sign up because before then you obviously hadn’t?
(14:22) So I think that the big deal is in today’s world it’s not about awareness. It’s much more about engagement and I think we were able to focus on who is coming and using our resources, online resources to actually inform not just decisions right about which car to buy or which insurance might be a good fit for their family or something like that.
(14:47) So I think it was really returning to the fundamentals and then really thinking less about just a media company where you aggregate a bunch of eyeballs and then you have some random ads and more like a marketplace where you have people really trying to actively research things and then service providers trying to compete for their business.
(15:11) So that was a thing that enabled you to get people to sign up.
(15:16) Yeah that’s right, it was a good place. It was a place that provided, you know really we used to say the inside scoop or in the Navy they call it the gouge, and in order to discover opportunities and products and services that might be a good fit.
(15:35) And so you mentioned that awareness is not sufficient but you need engagement, what do you mean by that?
(15:41) Well we wanted a depth of a relationship with people coming to use our services. So are they coming, are they staying for a long time, are they coming back, are they actually transacting through us.
(15:54) So these days in customer service and customer relationship management, engagement is the hot topic. Although engagement is almost being superseded by the notion of experience, does that come into play?
(16:09) Yeah, no I think it does and then one lesson we learned at Military dot com for sure was there’s a difference between what I’ll call client service and client success. And client service is like we’ll answer your phone in a timely manner, your phone call and your timely manner will be responsive to you, we’ll kind of live up to the letter of the law of what we’re going to provide to you.
(16:30) But client success is different. Client success is where the team really takes ownership for the success metrics for the client, right. And really becomes an extension of that team and delivers for that team. And if you can – as an organization, do that that’s a huge C change right, and that creates interdependence or real dependence on you which is you know, something that we were able to do over time.
(17:00) And what are the levers that drive engagement? So at Military dot com for example just to be specific, what were some of the levers that you figured out that would drive engagement and not just eyeballs.
(17:14) Yeah, so we were operating in, you know started in 2000 and the term social network didn’t really exist at the time. But we did know that when people were connected with other people on site their engagement went up. So again, I think that rather than being a media company we were a place to connect with other people. And so we kind of got out of the way and became a place where you connected with individuals, with services, with jobs, with all of that kind of stuff. So I think it’s the trust that came from providing a really good service.
(17:55) Okay, so you brought Military dot com back from the brink and then you sold it to monster dot com, at at monster dot com you were responsible for ‘affinity groups’ is that the name.
(18:14) Yeah networks.
(18:15) Affinity networks, okay, so how did that build on what you had done in this as you were just describing in this period of time, where suddenly you were very successful.
(18:30) Well so I think we learned a lot of ways to engage a community. And what Monster had realized and they had created this online, job matching category, but it was very transactional. People would come to Monster when they were looking for a job. And the reality is that many employers are looking for people who aren’t actively looking for a job. So as you walk around the planet there aren’t many unemployed nurses that are sitting around you know looking for a job. There aren’t many unemployed engineers or other sought after professions.
(19:06) So how would Monster engage a community over time, have a relationship that’s maybe professional development or other ways that helped them stay engaged, and really, Monster would have the opportunity to present new career opportunities to those of that we call passive seekers right, people who are gainfully employed, but might want to consider their next move.
(19:30) And that affinity network was really about taking those learnings from the military community and trying to apply them to other communities. And Christopher Michael was really you know a thought leader in this. And actually went out after selling Military dot com to Monster and started a company, really focused on engaging those communities and sure enough, very quickly I think it was a year or two after starting at Monster acquired it because it was such a unique capability.
(20:30) That’s right Affinity Labs, which I never made the connection. So in today’s world you know we hear about things like content, marketing, and influencer marketing and all of this. And at its heart it is very very closely tied to what you’re talking about. So that raises the question then how can a startup founder or somebody working inside a large company who’s in marketing for example, how do you build that community? How do you establish that affinity? What do you do?
(20:45) So I think it’s about a couple of things. So one thing is just really hitting the nail on the head right in terms of the questions that people have in their mind, and one way to do it is to make sure is that if people ask a question that you have quality answers. And that might be really supporting and answering community right, or maybe it’s technology that gets you the right answer to a question in the case of search engines or something like that.
(21:17) But then I think it’s using increasingly what you know about people, what they had volunteered to you in order to serve up the right stuff at the right time. And that’s why I think that technology has just continued to evolve. Because I think we used to be in an era where technology was a tool. Okay, you can go and you can look this stuff up.
(24:41) But where we want technology to evolve is technology to serve us right, and to be again with our permission about our willingness to share our preferences and interests and behaviors and whatever, so that the technology can be prompting us, ’oh, looks like you need this, looks like you need you know, don’t forget to do this’, or help you discover a product or service or a person that could be helpful to you at that time. And I mean I think that’s really exciting and that’s where were heading.
(21:15) And you know we talked about artificial intelligence a little bit earlier, and you know there’s a lot of people in the world that are very negative on the labor displacement that could happen with some of these things. And that is non-trivial. We have to think that through and there certainly will be people that whose careers are impacted by technology.
(22:33) But I also think on the flipside there are tremendous new possibilities created by technology. And technology that becomes easier to use, and effectively it lets people on ramp to a network economy where they can actually have more access to opportunity and prosperity which is pretty exciting.
(22:56) You know, on some level what you were describing the technology, the system giving people the answers that they want at a time that they want it and so forth. It sounds like you’re an ad technology dream come true. And I know that’s not your intention, but you’ve just described personalization and ads.
(23:19) Yeah, well I guess ads is – it’s funny because I wrote a study a long time ago that’s people don’t mind advertising that’s really relevant to them. If advertising is really discovery of products, and services, and information that’s good that is true. I think it has broader than commercial application right. If you find information that lets you be healthier and actually contribute to your happiness or longevity, that doesn’t have a clear economic benefit but it creates value for you.
(23:52) And I think so many companies today have the opportunity to create a lot more value than they capture. And again that’s the beauty of technology. It kind of lets you cheat the laws of the universe which used to be better, faster, cheaper pick any two. But now you know there really are cases where technology lets us be better, faster, and cheaper.
(24:19) That’s especially true in the case of discovering opportunities. You know there’s a great quote out there that says, ‘talent is widely distributed but opportunity is not’. And the network lets people really engage with what’s out there and see what’s possible for them.
(24:38) Get the learning for example that they need to close the skills gap and then to participate in that economy and again it’s not perfect by any means, but it is I think frankly better than it’s ever been.
(24:51) Now, apply it to education.
(24:55) Well I think there just is an opportunity now to think about personalizing opportunities and making learning fun, and those two dimensions are really new. So much of education and training around the world is highly standardized. There’s standardized tests and all that kind of stuff.
(25:30) But now with technology I think we have opportunities for personalized and adaptive learning. That’s huge. And I think the whole notion of fun is also big and it’s also less to do with technology than just of a kind of change in mindset. And somewhere along the way – and maybe it was the Prussian influence on education or something like that. It’s kind of like we decided that learning was too important to be fun. And schools became a fun vacuum and the training we have to do as part of corporate America isn’t generally very fun.
(26:05) But the reality is learning happens best when people are having fun. And infact in gaming, computer gaming learning is the fun. I mean think about the time people spend on games and again whether they’re offline games or online games, you know athletics or whatever, think about the time and effort people put into practicing and mastering.
(26:28) And could we create those same kind of healthy addictions in other areas. And I think that we’re going to be seeing more of that kind of engagement. And so it’s going to be learning that’s a lot more effective and a lot more fun, literally fun.
(26:50) So learning and personalization, what about applying this to the corporate market because you’ve been talking so far about higher ed or secondary school.
(27:08) Yeah the whole thing and I think that you know the thought that we would go to school from the time we’re about five years old to 18 or 22 or something, and then we fill the knowledge tank and then we’d be done for the rest of our lives is just a fallacy right. We need to continue this learning. So I think we’re seeing a lot of innovation, and certainly as venture capitalist’s we’re looking at some of those companies. Whether its companies like Degreed or Pluralsight or some of these others that are really emerging to help people build their skills. It’s really important and especially as more of the world moves to be freelancers or flexible workers right. it’s incumbent upon each of us to build our own skill and think of ourselves as athletes right that are trying to increasingly be able to have the you know kind of life style we desire to have by investing in ourselves.
(28:12) And is that your focus right now, is this what you’re seeking out as you transition from being a public company executive and entrepreneur to investor.
(28:23) Yep, so we’re really thinking about backing entrepreneurs who have an epiphany about learning in talent development, and the company’s that we think about are technology enabled but are human centered, right. They’re not just machine learning. They might involve machine learning but they would involve leveraging a person and helping that person be more effective. And so that’s one aspect and we look of course for big market, but it really comes back to the entrepreneur and we say that you know, entrepreneurs have these epiphanies.
(29:01) And I would think sometimes entrepreneurs are like comedians. Comedians don’t live in a different world than we do. They just have a different lens on the world that lets them see the humor in it, and entrepreneurs are the same way. I mean so many times we are struck by that the entrepreneur has looked at a situation that so many of us has seen as intractable or we just take it as granted and they identify a simple idea that changes our mind.
(29:36) That epiphany is important because if that entrepreneur is able to explain that in a way that inspires others, they have the kernel of you know the ability to really be a catalyst and then hopefully they’re really convicted about that. they’re really, we might say really hell bent on this because that resilience is needed as an entrepreneur. So yeah, so we’re looking for entrepreneurs that think about learning in technology and that really feel there’s a better way leveraging technology.
(30:11) So we have a comment from Steve Dippolitto, who is a higher education CIO who says he loves the statement, technology enabled but human centered. So may be elaborate on that, what does that mean?
(30:27) So I think and I think it’s the folks at MIT, like Andrew Maxie that says that technology today is doing for our minds what machines did for our muscles. You know there were people displaced by you know the automation of machines right, but by and large machines enabled us to do things much faster.
(30:53) Infact I was on a little trip in Viet Nam and I was biking through the back roads of Viet Nam and one of the local guides said we have oxen that help us plough the fields, and we also have Japanese oxen. And I said, oh what’s that and he said yeah it’s a tractor. It was a Toyota thing and he said I can’t tell you the difference it makes in people’s lives, right.
(31:23) And in the space of 20 years right, Viet Nam has gone from not being able to feed itself to being the number three exporter of rice in the world. And it’s just hard to argue that technology did not augment humanity.
(31:39) Now there might be some spill-over effects from technology and nothing is perfect, but I think there is this ability and people who are worried about technology I think need to be thoughtful about, let’s have the conversation about how we can make sure that we get the kind of future we want for technology. The future isn’t written right, and we have that opportunity.
(32:11) Now as you are out talking with companies can you give any examples of companies who are doing interesting things such as what you’re describing.
(32:24) Sure let’s see there’s so many I’m trying to think. So one I’ll point to is one is Andela, and Andela is by Jeremy Johnson and he’s a very successful entrepreneur. And he has education boot camps or training in Africa. And the people there are able to get certification and then he offers their services to American companies, right. So there’s a kind of a globalization going on there which is interesting.
(33:05) I think that there are great companies like Clever, so Clever has a marketplace for decision makers in K-12 schools districts to purchase things efficiently and to purchase them in an environment where they get to understand what other school districts are seeing. And so that just allows a level of transparency and efficiency which is really exciting.
(33:34) So I think there’s tons of this and actually there’s a company called Creative Devworks in Baltimore that actually has a similar model. They’re actually training people who sometimes even haven’t graduated from high school, with a bunch of skills that let them get employed. And there’s so many I think potential game changers out there and it’s not that there’s one size fits all; there’s more choices and now I think more transparency which is actually working.
(34:12) What about the business models because all of this ultimately can’t just be effective from an educational standpoint in order to be funded and get out there in the market, there has to be a sound business model. So do you have any thoughts on the business model around all of this stuff?
(34:29) I think there’s multiple business models and this is one example. This entire category has a lot of money in it. So again globally the market has $5 trillion dollars. It’s spent on education and training and that’s you know, there’s different breakouts from K-12, higher Ed and beyond.
(34:47) The easiest models are ones that say the alternative is to purchase this is x dollars and we offer the same benefit or more right, with more convenience at a fraction of the price. So I’ll use Chegg as a quick example. So Chegg offers textbook textbook rental and now digital textbooks and a bunch of other stuff. But buying textbooks new is really expensive for college students. The ability to rent textbooks that you don’t want to keep right saves up to 90%. That’s a huge saving.
(35:25) Another thing Chegg has is called Chegg Tutors, and Chegg Tutors lets you as a student whether in high school or college or wherever or included the workforce right. If you needed help, you could go online video voice or video text connect with an expert and you get to pick you know the expert that you like right, that you have an affinity for. Maybe it’s another woman who went to your college or went to your high school or something like that and you pay as little as 50c a minute.
(35:58) And so think about that change. There’s a lot of studies out there that say that one-on-one tutoring provide outsized result to students in terms of learning outcomes. Well one-on-one tutoring was extremely expensive and inconvenient right. You were kind of signing up for as a minimum like going somewhere, whether it’s an instituting center around campus or the tutor comes to your house or whatever for an hour.
(36:31) The paradigm now is literally it could be on your mobile phone or your computer. You could be stuck on a calculus problem and you could get five minutes of help to get yourself unstuck. So you can schedule recurring sessions with someone to take you through your stuff, or you can get the help you need just in time. So these are game changers, and it wasn’t until a couple of years ago where the technology would have been available to make that effective.
(37:00) So these are examples of what you were just describing using the technology to power human centered education.
(37:17) So what’s next for you?
(37:20) Well I you know feel privileged to be having the opportunity to talk to new entrepreneurs that want to start their business’s, and you know I think that I’ve made a lot of mistakes and learned a lot of lessons of the many years in doing this. And just excited to work with them more, and I do think that we have a great opportunity again to put technology to work for us to make sure we create more opportunity and more prosperity for people everywhere.
(37:56) Fantastic, well we have been talking with Anne Dwane, who is a serial entrepreneur, and this has been episode number 157 of CXOTalk. Anne thanks so much for taking the time.
(38:11) Thanks Michael.
(38:13) And everybody, I am so grateful that you are taking the time to watch us today, and come back next week and we will have another awesome show, thanks. Bye bye.
Companies mentioned in today’s show
Creative Devworks http://catalystdevworks.com/
Zinch see Chegg.com
Published Date: Feb 19, 2016
Author: Michael Krigsman
Episode ID: 316