Online K-12 Education IPO In The Great Recession: Archipelago Learning Co-founders Cameron Chalmers, Dave Muzzo, And CEO Tim McEwen (Part 2)

SM: What happened during the year and a half you were building the product? I assume you were able to put it online. What kind of customers were coming to you?

DM: We got a few people to register for a free service, and those users input their study material. We quickly realized over the course of a couple of months that we were never going to make any money doing that.

CC: The dot-com bust happened, and as a result we realized we had to collect money and not just get eyeballs on the website to be a viable business.

DM: That’s when we came up with three different business models for the application we had developed. The first model was before the No Child Left Behind [legislation]. States had standards, and standards tests were underway, particularly in Ohio and Texas. It was pretty obvious that it was a growing movement in the future of education. Our first idea was to build our own content based on state standards. The state standards provided a perfect roadmap for what the content should be. That is what we are still doing today.

Our second model was to develop an online companion to textbooks. The third model was to let other people use our engine for whatever training environment they wanted. We did pursue the textbook approach a little bit, but when we approached textbook publishers we were ignored.

We felt content publishing was the most attractive idea, and we went with that. We focused on Ohio, and once we built the content that was specific to the state’s standards, we went to schools there and started selling. Once we started making sales there, we didn’t even consider the other two models anymore.

SM: Isn’t it expensive to make your own content?

DM: Not if you do it yourself.

TM: I spent time at large publishers, including time as the CEO of Thomson Learning. It is a fairly expensive process. Dave and Cam did something that was unique. They took the perspective of the student. They approached it from the point of view of having to learn the material as a student who may or may not like school. They asked themselves how to make a fun and engaging for kids while keeping the content rigorous and capable of holding up to the scrutiny of educators.

SM: Can you give me an example? What did that change in perspective yield?

TM: Educators will teach a skill during the day and then assign a textbook chapter and some problems at the end. Generally, kids don’t read the book. They go straight to the questions and start answering them, and then if they get stuck then they flip through the text. Sometimes they find help, and sometimes they don’t. If students are from a family that doesn’t have a good support system, then they probably don’t do it. If students are stuck and their parents can’t help, it is frustrating for everyone. The next day they hand in their homework and get negative feedback from the teacher.

What Dave and Cam built allows the teacher to assign a module. When the student goes to the lab at home, all the student needs is a browser. There is a mini review lesson of what was taught and then the student starts to answer practice questions related to the topic. If they get it right then they can play a game for 10 to 15 seconds. If they get it wrong they receive an immediate explanation and do it again. If they have trouble with grade level material, the system automatically detects that a breach of competency and presents developmental material to them. It can keep moving down several levels to ensure the fundamental skill level is developed.

The students earn ribbons as they go through. The goal of the program is to earn a blue ribbon on all of the standards that they are supposed to learn that particular year for the core subject areas. The student takes control of learning, and they don’t have to go ask their parents. They get immediate feedback and reinforcement. The next day the teacher gets a report that shows how much time the student spent on the program and how well they did. They can also create reports for principals and parents.

Over the years we have added other features. We have standards-based lesson plans, video clips, and training for teachers to show the best ways to get concept or skills across. It’s a great way to learn and is a fraction of the cost a lot of textbooks and other instructional solutions.

This segment is part 2 in the series : Online K-12 Education IPO In The Great Recession: Archipelago Learning Co-founders Cameron Chalmers, Dave Muzzo, And CEO Tim McEwen
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