Imagine K12 Ed-Tech Startups Court Investors
Twice a year, for three months at a time, Imagine K12, the pre-eminent startup incubator for K-12 education technology companies, brings a handful of entrepreneurs to Palo Alto, Calif., to basically teach them how to become an education company, in exchange for a stake in the company. Each three-month program ends in "demo day," when each company pitches its product to a room full of investors.
This is only the third program held by Imagine K12, but demo day is already one of the bigger days of the year for Silicon Valley's ed-tech scene; this year's event drew about 150 people from the education technology industry and venture capital world.
By this point, the companies—there are 11 this time around—have each developed a product that can go to market, though the stages of the companies are varied. Some have been around for more than a year, but are shifting direction (like Tioki, a professional social network for teachers, which used to be called DemoLesson, a human-resource-management tool for schools). Others entered Imagine K12 with only ideas (like Tryumph, which started as an educational-game recommendation service, and is now developing a quiz app, call Drop Some Knowledge). Some have already launched and are gaining users; others are just now being shown to the world. In all cases, Imagine K12 companies take on the philosophy of the incubator's three partners—Tim Brady, Alan Louie, and Geoff Ralston, former executives at companies like Yahoo, Google, and Netscape—that the consumer, in this case teachers, should drive the product development.
In addition to demo day, Imagine K12 holds "educator day," where each company pitches its idea to a room full of teachers. I attended educator day in August for a story I wrote about Imagine K12 (you can watch a video of one company, SmarterCookie, preparing for educator day, below). That is obviously a much different audience, but not too different an event. For educator day, pitches are based around: How can this product make educators' lives easier? When it's time to pitch to investors, it's still about how the product can make educators' lives easier, but as a means of gaining users, creating growth, and eventually making money.
"Defining what problem they are solving from a business perspective, without education jargon, is really important," Brady told me yesterday. Companies should be answering the question: "If this product gets used today, what does that mean for the business going forward?" Teachers tend to appreciate empathy, and in the case of about half the teams, which have someone with classroom experience, that isn't a major obstacle. But investors look for people who walk the "fine line" between confidence and arrogance, Brady said.
I also spoke with Tess Brustein and Michael Gerson, the co-founders of SmarterCookie, an online professional-development service, as they prepared for demo day. Brustein is a former teacher in Brooklyn, and Gerson is a former technology consultant. They got the idea for SmarterCookie as roommates in New York City, when Brustein would come home and lament the lack of training and coaching she received at school.
Over the course of Imagine K12, SmarterCookie moved from a service primarily targeted at teachers, who could load videos of themselves teaching and invite peers or mentors to give feedback, to a service targeted at teacher coaches, to help organize and inform the teacher-coaching process. When SmarterCookie officially launched a few weeks ago, it found that much of initial uptake came from teacher coaches, who typically have to manage up to 50 teachers at a time. The company added a special login for coaches so they can easily enter their teacher rosters, upload videos of each teacher, and push exemplar videos to them as well. Teachers still use the site, but Brustein and Gerson learned whose problems they were most directly solving.
"The priority has shifted of who we reach out to first," Brustein said. "Our [demo day] presentation will focus on coaches because it's easier to target them. This is the pain point we are solving for them."
That priority shift is already leading to bigger sales for SmarterCookie, which is in negotiations with whole schools and districts to use the product. Those leads mostly came from coaches within those districts and schools, Gerson said. The bottom-up model of driving sales is one prevalent among early-stage Web-based education companies, and one touted by Imagine K12.
It's not as though demo day is an auction, so investments likely won't be made on the spot. But it's meant to establish relationships between the companies and investors. The 19 past Imagine K12 companies have raised millions in funding; most recently Goalbook, an online individualized-education-program management service, raised $915,000 in venture capital. A company from the current cohort, No Red Ink, an online literacy-assessment tool, recently won Education Nation's Citi Innovation Challenge and $100,000.
I wasn't able to make it out to Palo Alto for demo day, but plenty of folks in attendance were tweeting about it. Here's a sampling (warning: there are a lot of exclamation points), along with some audio interviews I conducted with the companies in August: