St. Louis’ Education Startup Scene Gains Traction | St. Louis Public Radio

St. Louis’ Education Startup Scene Gains Traction

Feb 5, 2015

Credit NathanReed / Flickr

Cheap living, a network of startup incubators and a couple of hometown success stories have raised St. Louis’ profile among investors looking to get in early on the next big thing.

Though much of the focus has been on financial services, the life sciences and agriculture, momentum is building in another field -- education. And even though plans are still being drawn up, an effort is underway to harness local startup energy toward improving classroom success.

At the same time, questions linger about what education should look like in the digital age.

Building a nerve center

The clack of Bijal Desai-Ramirez’s high-heeled shoes ricocheted off the concrete floor and two-story tall glass windows in the Ward E. Barnes library at the University of Missouri-St. Louis (UMSL). With walls shaped like an upside-down trapezoid, the 1950s-era building is a textbook example of postmodern architecture. And if things go according to plan this August, a massive empty space in the library will be reborn as the nearly 11,000-square foot ED Collabitat.

“We think the transparency and modern look of the building is exactly what we want to parallel internally,” said Desai-Ramirez, executive director of education innovation at UMSL.

Bijal Desai-Ramirez, executive director of education innovation at the University of Missouri-St. Louis
Credit Tim Lloyd / St. Louis Public Radio

What exactly that means remains a work in progress. But the general concept, she said, is to build a space that connects education-minded entrepreneurs, administrators and business people with the larger startup scene in St. Louis. The open floor plan will be filled with workspaces and white boards in the hope that ideas will cross-pollinate among groups. There will also be a heavy focus on professional development and building bridges across a patchwork quilt of area school districts.

“If you bring more diverse stakeholders to the table, the theory is you’ll develop better solutions more quickly,” said Desai-Ramirez, who previously worked with corporations managing organizational change.

Altogether, it’s expected to cost around $1 million to get the Collabitat up and running. Roughly $500,000 will come from UMSL’s general budget and go toward renovating the space itself. The college of education expects to chip in between $250,000 to $300,000 on furniture and an additional $225,000 to get programming off the ground.

“It’s our own entrepreneurial exercise,” said Carole Basile, dean of the College of Education.

Basile said the plan is to ramp up fundraising to sustain the Collabitat. And with 900 future teachers in the school’s pipeline and a staff of researchers, she said they can deliver a solid pitch to potential donors.

“When we know something is working, we can take it to scale,” Basile said.

She said the goal in part is to train new teachers how to think like intrapreneurs,” with the skills to spot problems and find creative solutions in their classrooms.

The nearly 11,000 square foot space that will be remodeled to become the Collabitat at the University of Missouri-St. Louis.
Credit Tim Lloyd / St. Louis Public Radio

While the Collabitat begins to take shape, education focused startup incubators are picking up steam in other parts of the country. In New Orleans, the nonprofit 4.0 Schools has quickly gained national attention for its model of weaving startup attitudes into education.

Founded four years ago by Matt Candler, 4.0 Schools has launched more than 40 for-profit and nonprofit ventures. Rather than looking at top-down education policy, Candler said their model focuses on solving individual problems inside and outside of classrooms.

“There is great merit in focusing on that granular level,” Candler said. “That’s where our greatest potential is as a country. That’s what we’ve always been good at, solving really specific problems in creative ways.”

Basile said she hopes the Collabitat will look for ideas that can ease long-standing headaches that would otherwise be ignored. Things like rethinking how bathrooms are designed so they don’t become hiding places for students or problem areas for bullying.

“My whole approach to everything is to throw a bunch of seeds out there and see what happens,” Basile said. “If it doesn’t take, do something else.”

Gaining traction

From software that sends students text message reminders about upcoming assignments to professional development, ed-tech startups have become more and more enticing for investors. Nationally, ed-tech startups brought in about about $1.87 billion in venture and equity financing in 2014, according to CB insights. That’s an increase of 55 percent compared to the previous year.

“This is a classic example of a new industry starting to mature,” said Betsy Corcoran, chief executive and founder of Ed Surge, a Silicon Valley based news service that's covered the ed-tech industry since 2011.

At the same time, Corcoran said aspects of ed-tech separate it from other parts of the startup world.

“The companies that are ultimately going to build products that make a difference in the lives of kids and teachers have got to care about a lot more than the bottom line,” Corcoran said. “It’s not enough to say I’m going to be a profit-maximizing company.”

But that attitude also has the potential to drive away major investors out to buy a piece of a company that can later be sold for a large profit.

“They can look at investments in companies that have served the education field in the past and say, ‘well, who’s really made a lot of money on this?’” Corcoran said. “And when you ask the question that way, the answer is, not tons of people.”

Most money, she said, comes from “angel” investors who seed companies in their infancy. Those investments, however, tend to be smaller. So when it comes time to find the money needed to grow a company, ed-tech startups can face an uphill battle.

“In St. Louis, it’s even harder,” said Ginger Imster, executive director for Arch Grants. “Because you don’t have a demonstrated record of successes one after the other.”

Blake Marggraff, co-founder of BetaVersity.
Credit Tim Lloyd / St. Louis Public Radio

Arch Grants makes equity-free investments in fledgling companies in exchange for their relocating to St. Louis. Two years ago, the organization began funding education-focused startups. Code Red, a company that helps schools teach computer programming skills, was the first recipient of Arch Grants’ $50,000 award. Two years later, Code Red is being used in multiple St. Louis area school districts, including St. Louis Public Schools.

This year’s Arch Grant recipient in education was Betaversity. Founded in late 2013 by 22-year-old Washington University student Blake Marggraff and two of his associates, Betaversity began by designing maker spaces -- workshops filled with sophisticated tools -- for colleges and universities. With revenue in the “low six figures,” the company was profitable in its first year of operation, according to Marggraff.

Beaversity also makes the BetaBox, a shipping container loaded with things like 3D printers and laser cutters, mainstays of increasingly popular maker and hacker learning environments.

“From the time that we received an Arch Grant, we’ve had dozens of individual teachers who are passionate about bringing ed-tech to their students reach out to us and say, 'Hey, maybe we can’t get the product just yet, but how can we learn from you, how can we collaborate?’”

For between $1,000 to $2,000 a day, a school district can contract with the company to bring the BetaBox to one of its schools. The company’s one operational BetaBox is currently traveling around to schools on the east coast.

If Betaversity takes off, Marggraff said they don’t have any plans to relocate out of St. Louis. But with an increasingly crowded field of ed-tech upstarts and a maze of bureaucratic purchasing policies, earning contracts with school districts can be tough sell.

“Education is designed to be careful, and that’s not a bad thing,” Marggraff said. “Students are well taught by some schools because the content is well defined. But that can be pain. Sometimes the most innovative products face opposition because they don’t quite fit the mold.”

Balancing act

Nationally, the procurement process for ed-tech is cumbersome and outdated, according to a report issued last month by the Center for Reinventing Public Education. To reach that conclusion, researchers interviewed district officials in Philadelphia, Cleveland, Los Angeles, the District of Columbia, New Orleans and Chicago. The typical purchasing process also favors established vendors over ed-tech startups.

“This tends to slow things down and scare people off from even trying something innovative,” according to report.

At the same time, there are plenty of cautionary tales of ed-tech deals gone awry. Not the least of which is the on-going controversy surrounding Los Angeles Unified School District’s plan to reboot classroom instruction with iPads and software from publishing giant Pearson.

NPR member station KPCC published emails between LA Unified officials and tech executives that called into question the competitive bidding process. And when the iPads showed up, many schools in the district weren’t wi-fi ready. On top of that, the software was glitchy. As controversy swirled, Superintendent John Deasy resigned in October of last year. The Federal Bureau of Investigation has since opened an investigation into the deal.

"It's very easy to get caught up in it without returning to what the purpose of education ought to be. The idea of developing critical inquiry. Technology can assist in that, but it can't replace a teacher engaging students." -- Alexander Cuenca, a professor of education at Saint Louis University

There are also lingering questions about the role technology should play in student learning. For instance, researchers at the University of California Los Angeles recently found that excessive screen time can inhibit sixth graders’ ability to read human emotions.

“Sometimes kids, teachers and schools get caught up in the latest fetish,” said Alexander Cuenca, a professor of education at Saint Louis University. “Technology changes fast. It’s very easy to get caught up in it without returning to what the purpose of education ought to be. The idea of developing critical inquiry. Technology can assist in that, but it can’t replace a teacher engaging students.”

Against an ever-changing backdrop of potential benefits and high-profile failures, administrators are trying to establish how the digital revolution should play out in their classrooms. A year and a half ago, the Parkway School District established a five-person “innovation” team to help the district with more than 17,000 students sort out the best way to use ed-tech.

“We try to respond to our curriculum needs through technology rather than modifying our curriculum based on the technology we have,” said Bill Bass, innovation coordinator for Parkway.

That often means looking outside of education circles. For example when Parkway created Spark!, an incubator for student business ideas, administrators reached out to the local startup community for ideas.

But not every St. Louis area school district can afford to create the same kind of ed-tech team that’s in Parkway. And with 23 school districts operating in St. Louis County alone, Bass said something like the Collabitat at UMSL could be used to help share expertise across district boundaries.

“The purpose and the power there comes from thinking together with different districts and different groups as they strive to think about what education looks like in the digital age,” Bass said.