…on life, the universe, and everything

Social Skills Education

In my post, “Why we got 140 characters instead of flying cars,” I made a throwaway comment about how enterprising individuals should focus on communication skills instead of delivery. My podcast cohost Mik, was disappointed that I was writing about economics and not communication. So today I’ll talk about the economics of education instead =P

I’ll cut to the chase. Teaching communication skills is not a very good idea for a startup.

This isn’t news. I said it in the last post too. Communication skills are valuable, but capturing that value is difficult. Education startups aren’t debuting to multi-billion dollar IPOs. Not Learn-to-code startups. Not Learn-to-write startups. Not learn-a-new-language startups. Not even learn-to-make-friends or learn-to-influence-people startups.

People just don’t value education in that way. Universities have managed to jack up the price, but even they focus on prestige, job prospects, facilities, and connections.

Conspicuously absent: the stuff you will know when you graduate.

In fact, those parts seem to be losing prominence as a larger trend in education. The focus is on opportunity, not knowledge.

And selling knowledge is getting harder. The Internet is socializing us to believe information should be free.

So… where does that leave you, the social entrepreneur?

Delivering communications – no matter how inane the content – at least has a business model: insert extra communications (ads) into your pipe in exchange for cash.

I hate that business model, but c’est la vie.

Some education startups have innovated in the business model department. Duolingo teaches you a language, and when their students become advanced they translate documents for practice. They sell translation services.

At first blush, you’d expect a high-value skill like computer programming to be something where you can sell education for a high price. If a professional programmer can earn $100k/year for the next 10 years – that’s a million bucks! – surely you can charge $5k to teach someone that skill. After all, that’s only half a percent of the earnings.

But that math only works if you assume that you’ll only want/need to learn one career skill. That you’ll like the first one you learn. That the skills will remain valuable for a long time. That’s not how people work.

If you’ve never tried computer programming, you really have no idea what it’s like to be a programmer (take it from me). Would you simultaneously choose a career you know nothing about AND hand over $5k to someone whose expertise you are completely unable to evaluate? I wouldn’t. Even without the risk of some asshole running off with my five grand.

Could a learn-to-communicate startup work (be profitable)? Maybe. First they’d have to settle on an approach. Will they teach people to write? to speak? to unravel the mind of their audience?

So far these sound like classical academic topics – literature, theater, psychology – and not exactly a bunch that are associated with high-paying careers either.

Much like technology, these things can be tremendously valuable when used in conjunction with another skill. It almost doesn’t matter what that other skill is. But that makes the value proposition even harder than the computer programmer one. “Want to learn a skill which will make you marginally more successful in whatever other career path you choose? I’ll teach you, that’ll be five grand.”

Now add the fact that people generally don’t think of themselves as poor communicators, and generally underestimate the benefits of good communication skills. How are you going to sell that?

Back to the drawing board. Each education startup will have to find a purpose-made way to capture value (a la duolingo).

And if they can’t? Screw it. Slap an ad on top and IPO.