The Education Problem: Raj Reddy (Part 6)

How do you take a new educational model, fund it and successfully convince students to enroll in your school? Raj answers all of these questions in this segment.

SM: What is the model of Gurukulam? Is it foundational support? How are you financing the project? RR: The financing is very interesting; it is what we call a money back guarantee loan. Banks in India will give you educational loans. What we are saying is, after you complete your program (and you won’t complete it until you get 95%) that if you don’t get a good enough job, you do not have to pay your money back.

SM: Are you providing the loans? RR: The bank is providing the loan, we are providing the guarantee.

SM: You will pay the loan back to the bank if the student does not get a job? RR: Yes, that is the rhetoric. I provide that guarantee because I know these students are pretty good, otherwise they would not have graduated in the first place. If they don’t find a job it’s because the job didn’t exist.

In this case I will use them as mentors for the entering class; they just did this stuff two years ago, they know everything. I hire them, I give them room and board, and I pay off their loan within two or three years. With their loan paid off they are free to go do anything they want.

SM: What is the scale at this point? RR: It is infinitely scalable. I need to give you the history on this. I went to the Chief Minister of Andhra and made a presentation to him and told him it was an interesting opportunity and asked him if he wanted to do it. He is big on rural development and he immediately picked up on the idea. He wanted to do it on a larger scale, he wanted to have 5,000 people trained every year. I told him to wait because he did not have the residential capacity for 5,000 people, actually those buildings are getting started this month. With the pilot group we admited 3,000 people.

The President of India visited one of them the other day because he was also curious – he wanted to know if this really worked. I know most of the CEOs of IT companies in India. They are excited and they want to see how this works as well. One of the reasons for their interest is because the Prime Minister has been making noise saying he wants the private companies to support affirmative action, to hire from the schedule casts.

When I tell them about this they are excited because at least they know they are hiring high caliber people who are trained as well as anybody else, and they happen to be from schedule class, which makes them even happier.

[To Be Continued]

[Part 5]
[Part 4]
[Part 3]
[Part 2]
[Part 1]

This segment is part 6 in the series : The Education Problem: Raj Reddy
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