Technology can have the power to transform a system of education and this is what has got venture capitalists all excited. While compared to the other traditional options, online education startups can be remade in a cheaper and more efficient way. This is what is being recently gambled by venture capitalists these days.
“Grading Student Loans”, a blog by the Federal Reserve Bank of New York reports that the debt of student loans nationally is so high that it even exceeds credit card debts and auto loans. With the cost of higher education rising with time, many students face the difficulty of borrowing their way to higher education.
Last year, Coursera had made its debut with an investment of $16 million from New Enterprise Associates and Kleiner Perkins. Today, it conducts free classes in law, arts, economics, science and business for over 2.3 million people over the globe. With coursework from over a dozen universities like Stanford, Duke and Princeton, it has managed to build a large enough userbase .
“Elite education is too expensive, and it’s available for too few,” Kleiner Perkins partner John Doerr told The Wall Street Journal. “I’m not saying accredited institutions will go away, but having great content available for free in the U.S. can transform community college education… and in the developing world as well.”, as reported by readwrite.com.
Pluralsight, 2tor, Craftsy and Lore are some of the other online schooling startups that have received investments of over millions of dollars from venture capitalists.
The change that can be made to higher education by venture funded startups is still yet to be determined. There are also hurdles to face in the process. The courses to be delivered will have to be accepted by recognized colleges and State Universities in California apart from getting the approval of the employees.
"Today our aim is to focus like a laser on entry-level classes that can be so difficult for our students," Mohammad Qayoumi, president of San Jose State, said during a public signing of the deal that was attended by California Governor Jerry Brown. "Every year nationally, 1.7 million students need remedial education. That's roughly the population of San Jose and San Francisco combined. We must innovate."