Startups Weekly: What kind of education do you need to build a great tech company?
Easy
start-up ideas have all been made — those that just required some homebrew
hardware hacking or PHP dorm-room coding to get it off the ground. You may need several
advanced technical degrees to achieve something significant these days. At
least that's what Danny Crichton is gloomy about this week, in an essay
entitled "Today's Two Ph.D. Problem of Startups." Here's a new example:
Take
synthetic biology and the future of pharmaceuticals, please. There is a popular
and very well-funded thesis on crossing machine learning and biology/medicine
together to inspire the next generation of pharmaceutical and clinical
treatments. The datasets are there, the patients are ready to buy, and the old
ways of finding new candidates for disease treatment look positively ancient
against the more deliberate and automated approach of modern algorithms.
Moving the
needle even slightly here, however, requires an enormous knowledge of two very
hard and disparate fields. AI and bio are domains that become extremely complex
extremely quickly, and where researchers and founders quickly reach the
frontiers of knowledge. These are not "solved" fields of any kind of
imagination, and it's not unusual to quickly get a "No one really
knows" answer to a question.
Even when
you try to build teams with the right combinations of knowledge, he argues,
each domain is now so complex that the mesh of skills required is far more
difficult to achieve than previous efforts.
In part, I
disagree, because innovation does not map existing domains in such a simple
way. Computer scientists in the '60s didn't expect personal computing to be a
thing until the homebrewers at Apple proved it. Enterprise software industry
experts last decade did not expect the developers of consumer apps to apply
their bottom-up growth skills and beat the sophisticated offerings made by the
incumbents. I expect all sorts of arcane academic ideas to be blended with market
demand in unexpected ways that break apart the models we have today, led by
people who might not check all the boxes in traditional fields.
This
includes the Ph.D. itself and the education sector. Which is where Danny and I
are in agreement. Applying software to education has been a struggle because
success requires understanding two disciplines, and he concludes that the way
we learn will have to be broken down and reformed:
"We
can't wait until 25 years at university is over and the people have graduated.
Haggard was 40 years old before they could take a shot at some of those
fascinating intersections. We need to build bridges to those gaps where
innovation has not yet been achieved.
Edtech 's top Future
Almost to
prove Danny's first point, some of the biggest companies in the world. Today,
edtech was founded by technical experts who were also university professors.
Companies like Coursera are now raising their late-stage funding rounds to the
top of a pandemic-fueled online higher learning boom.
A potential
gig economy for education created through online small-group learning would
have a significant impact on both the supply and demand side of online
education. Giving educators the ability to teach online from home opens up the
opportunity for many more people around the world who might not have considered
teaching otherwise, and this can greatly increase the supply of teachers around
the world. It is also capable of alleviating the discrepancy that exists
between the quality of teaching in urban and rural areas by enabling students
to have access to the same quality of teaching independently of their location...
Companies in
this area, such as Outschool and Camp K12, are pre-college. But take a look at
all those who are trying to teach data science, product management, and other
concepts that traditional industries need to incorporate to innovate more
quickly, and you can see the solution that Danny hopes will emerge. One day
soon, you might be able to quickly learn a new skill that you need to get a job
— or a medical breakthrough.
Planning your own equity after an IPO
Do you think
the next Amazon or Google is your unicorn employer? Are you ready to hold on to
the stock of a potential winner through all the ups and downs that happen to
any company? If you haven't already, consider diversifying sooner rather than
later, Peyton Carr, Startup Financial Advisor, writes this week in a series on
the subject:
Any stock
position or exposure greater than 10% of the portfolio is considered to be a
concentrated position. There are no hard numbers, but the appropriate level of the concentration depends on a number of factors, such as your liquidity needs, the overall value of the portfolio, the appetite for risk and the longer-term
financial plan.
The
company's "stock" in your portfolio is often only a fraction of your
overall financial exposure to your company. Think about your other potential
sources exposure, such as limited stocks, RSUs, options, employee share
purchase programs, 401k, other capital compensation plans, as well as your
current and future pay streams linked to the success of the company. In most
cases, the prudent path to achieving your financial objectives involves a
well-diversified portfolio.
