Cost vs Quality in Edtech – Keith Schacht, Avichal Garg, and Geoff Ralston

TL;DR

Avichal Garg's 2011 thesis—that edtech startups fail because they focus on quality over cost, should target Asia, and avoid VC money—is still broadly true in 2018 but shows signs of change. Keith Schacht argues quality can work, citing Mystery Science's school sales and the power of student engagement as a better proxy for learning outcomes.

Key insights

• The mainstream education market cares much more about cost than quality; founders tend to overvalue quality relative to consumer buying psychology.
• Post-WWII economic conditions created a value system where parents assumed their children could succeed without a degree; the 2000s recessions broke that expectation, creating a cultural lag that edte
• K-12 education is not a single market: elementary vs. high school, parents vs. schools vs. institutions are fundamentally different customer segments with different buying behaviors.