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Vision India 2020: Lucid

Posted on Tuesday, May 13th 2008

In 2004, we started investigating the issue of K-12 education, especially in Math and the Sciences. As part of this endeavor, we interviewed a number of teachers at various high schools in the Bay Area. Two nuggets came out of these interviews (1) there is no standardized methodology of teaching (2) there is no methodology for personalized skill-gap analysis.

Lucid was founded upon these two core foundational blocks. They had implications well beyond the local schools and students.

As Chris Kaegi, a teacher at Galileo High School in San Francisco explained, “If a teacher has to teach 50 kids per class, across 3-4 grades, it is very difficult to keep track of which kid has absorbed what’s being taught, and which one has not.”

This results in a chain of problems as the child moves from one grade to the next. A “D” in 7th grade degrades to an “E” in 8th grade, followed by an “F” in 9th grade. If you don’t know how to do fractions in Algebra, how would you solve quadratic equations?

With our knowledge of Artificial Intelligence, we concluded that a knowledge base of content was needed that is aligned with a methodology of teaching. This methodology would include personalized skill gap analysis, such that, a student studying Basic Algebra could be tested to identify exactly where her knowledge gap was. Be it in dealing with fractions or exponents, this knowledge base and analytics software was capable of getting to the heart of the problem.

Once the problem was identified, the knowledge base had modules for teaching each one of the areas that needed focused attention.

Of course, Venture Capitalists at the time hated the Education market, since some had tried to penetrate it with marginal success, including the legendary John Doerr. The conventional wisdom was that you don’t make money in education. There was a lot of truth to this assumption, since getting products into schools was an up-hill task.

However, in 2008, the Web 2.0 era was fully manifest, and Web 3.0 was about to be launched. Web 3.0 turned out to be all about personalization.

Against this backdrop, Lucid was launched with $8 Million in Series A Venture Capital led by a firm called Emergence Capital. It was a powerpoint financing, with no other asset yet in place.
It took us 3 years of absolute stealth-mode Research & Development to come up with a scalable methodology for Math (Arithmetic, Algebra, Geometry, Trigonometry, Calculus) alone that covered grades 6-12. We created and licensed an enormous amount of content that aligned with the methodology at our development center in India. We involved teachers who had particular reputations for being “great teachers,” studied their “art” at great depth, and encapsulated as much as we could into a “science.”

Then came the go-to-market challenge.

While we wanted this to be a worldwide service that every Math teacher at every school in every country adopted to teach every single one of their students, we had to segment the market and find a business model that would let us penetrate and get early traction.

We chose to go with North America with a Web 3.0 approach. We created a Community for Middle School and High School Math teachers to interact, exchange ideas, and organically engage with one another. We also had a Community of Middle School and High School parents at each of the schools that our teachers taught in, who participated in the exchange.

Most importantly, every teacher who adopted our methodology in their schools, managed to get the buy-in of the parents to pay for the service.

This was very important from a business model perspective, since it allowed us to bypass the school system altogether.

It also meant that our target customer base remained constrained to affluent families in North America. We did have teachers and families using our service elsewhere in the world, including India, UK, the Middle East and Australia, largely due to word-of-mouth. But by and large, we consciously chose not to fight the battle yet of tackling the less affluent or poorer segments of our eventual target audience.

We accepted this segmentation reality for 5 more years, because it allowed us to refine our methodology, build company valuation, raise a great deal more financing, and expand into other subjects beyond Math, including Biology, Physics, Chemistry, World History, World Geography, English, and English as a Second Language.

All the while, we grew our revenues at a 113% CAGR.

We could have become profitable by 2016, but we took our time. We were addressing a big problem, and we chose to do it right. We invested in building the most remarkable Content partnerships with Discovery Channel, A&E, CNN, etc.

In 2020, however, we were extremely profitable, and had an operating margin of 29% against a revenue of $3.6 Billion.

And, we were so well-known as an effective methodology by 2017, that Gates Foundation came to us with a proposal to fund a roll-out of our methodology into the poorer schools all over the world.

In 2020, thus, we are the leading global educational brand.

Note: Vision India 2020 was subsequently published as a book. You can order it from AmazonKindleAmazon.in, etc.

A call to Indian entrepreneurs everywhere, Vision India 2020 challenges and inspires readers to build the future now. In this “futuristic retrospective,” author Sramana Mitra shows how over the next decade, start-up companies in India could be turned into billion-dollar enterprises. Vision India 2020, which encompasses a wide range of sectors from technology to infrastructure, healthcare to education, environmental issues to entertainment, proves how even the most sizeable problems can be solved by exercising bold, ambitious measures. Renowned in the business world, author Sramana Mitra conceived Vision India 2020 from her years of experience as a Silicon Valley strategy consultant and entrepreneur. Well aware of the challenges facing today’s aspiring entrepreneurs, Mitra provides strategies, business models, references, and comparables as a guide to help entrepreneurs manifest their own world-changing ideas. 

This segment is a part in the series : Vision India 2020

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Sramana,

There are a few players in India already trying to address the same area – personalized skill-gap analysis in various subjects and using a best-of-breed pedagogic methodologies.

Atanu (https://deeshaa.org) Dey has his take on the subject, and I am sure you are aware of his project to create an ICT solution for making education accessible.

Just one point I wish to make: The approach you mentioned is a real luxury and can only be done through ‘power point financing’ as you rightly put it. Unfortunately, that level of risk taking and long term vision is yet to percolate to VCs operating in India or even valley-based India-focused VC funds. Yea..I know what you will say..thats a separate discussion 🙂

Will be good to see a roundup from you on such initiatives currently underway – not the Tutorvista style startups, but initiatives focused on addressing the larger problem.

cheers,
Kumar

Kumar Narasimha Wednesday, May 14, 2008 at 12:04 AM PT

I haven’t seen any methodology from the current players that looked convincing to me. I have my own thoughts on the right methodology.

Sramana Mitra Wednesday, May 14, 2008 at 10:26 AM PT

Interesting vision, kudos on something visionary in this space. Solid research in the US and in some APEC countries shows that, in Math & Science (STEM) fields, testable and repeatable success in students’ learning depends above all on content knowledge in the teacher. Everything else is minor, from class size to pedagogical delivery to methodology. I think in the US your business model is right, finding a way to access families directly and work around the schools… I myself prefer the summer camp, tutoring, and after school approaches. But in some other Asian and European countries with centralized education systems, you could get a HUGE amount done with a signature from the right bureaucrat.

Mike Thursday, May 15, 2008 at 2:36 PM PT

Hi Mike,

Have you ever dealt with bureaucrats? Getting things done when they are the gatekeepers is a total nuisance.

Sramana

Sramana Mitra Thursday, May 15, 2008 at 5:10 PM PT

Hi Sramana,

HAHAHA, I used to be a Federal education bureacrat!! In the US (at least), we tried not to make problems, but it is just inevitable in an area like education. Just look at NCLB… Ugh. So yes, no argument about the nuisance of working with bureaucrats in India or anywhere else.

But seriously, my point is that if by chance you have the right relationship with someone at the highest level in a centralized place like China or Japan, an educational services outfit could possibly make a great leap forward, so to speak… Still, you would need to help build consensus across the education sector in your target country.

The education space is a very tricky market, but it is a huge one, and in the face of globalization will only grow in scale and also in importance for everyone. Forgive me for emphasizing the obvious, but that is what bureaucrats occasionally do… Cheers!

Mike Saturday, May 17, 2008 at 6:04 PM PT

Sramana,

I liked the idea, although parts of it have an element of luxury in it. However,this vision that you have put forth does not seem to be India centric as most of your other ideas have been. There is no mention of using India specific knowledge or benefting the Indian commnunity specifically at large. Somehow, i feel that it does not belong to Vision India 2020.

Vishal Wednesday, July 23, 2008 at 10:59 AM PT

You cannot develop a knowledge base of this size without using a cost-efficient back-end, which is where I see India’s role. Also, India has good teachers in Math and Sciences, whose “emthodology” can be leveraged, potentially.

India back-end, world-market deals are part of my Vision for India 2020.

And what on earth is wrong with luxury products? They offer the best margins.

Sramana Mitra Wednesday, July 23, 2008 at 1:37 PM PT

[…] previous ones are: Preface, MIT India, Urja, Lucid, Darjeeling, Renaissance, Gangotri, Maya Ray, Elixar, Bioscope, Thakur, and […]

Vision India 2020: Updates at VentureWoods - India's leading venture capital community Monday, August 18, 2008 at 4:44 PM PT

[…] segments of the running series can be accessed at MIT India, Urja, Lucid, Darjeeling, Renaissance, Gangotri, Maya Ray, Elixar, Bioscope, Thakur, AdiShakti, Framed Ivory, […]

The Indian Economy Blog » Entrepreneurship Vision India 2020 Tuesday, August 19, 2008 at 7:29 AM PT

Sramana,
Have you checked out ‘Apangea Learning’?
They are also focusing on Skill-Gap Analysis.Also creating content for Education is lot expensive than designing the whole software processes.
Why is that Content Creation that expensive?

Raj Tuesday, May 12, 2009 at 10:05 PM PT

It’s a large body of content, across multiple subjects, multiple grades, multiple learning styles.

I have no tseen Apangea Learning.

Sramana Mitra Wednesday, May 13, 2009 at 9:55 AM PT

Sramana,
Thanks for the response.
‘Apangea Learning’ is focusing on Math courses.
If not for the creation of content, what other barriers of entry do you see in here?. Don’t you think with possible partnerships with educational content providers like Scholastic would solve the issue of content creation.

Raj Wednesday, May 13, 2009 at 12:08 PM PT

The traditional text book publishers have one-dimensional content, and none of the knowledge base technology. That’s a very specific architecture, and will inevitably create serious barrier to entry.
Similarly, the quality of content will also do the same.

Sramana Mitra Wednesday, May 13, 2009 at 4:15 PM PT

Having taught students Math & science as a part of my T.A., I have always felt marriage of web 2.0 and education is inevitable . The methodology you have proposed above in the blog is ‘formative assessment’.So is n’t this more like a fusion model of (Formative assessment+ one-on-one online tutoring) ?
If not, what sort of a different architecture are you proposing here.
For content creation,why cannot we let the teacher community contribute to the knowledge base,which makes the knowledge base evolving.
I think a proper process has to be defined to filter the contributions made by the teacher community(like Wikipedia) Or incentive the content contributors .

Raj Wednesday, May 13, 2009 at 9:22 PM PT

Some of the problems I have faced are related to learning disabilities not being diagnosed, or being diagnosed wrongly. We need a skills-gap analysis within an experiential framework wherein with exposure and coaching the student can be made to both feel secure and competent in areas where his/her strengths lie. The way child specific problems are tackled in an offhand way in the schooling systems excruciatingly painful for both the child and the parents.

Sum Thursday, May 14, 2009 at 12:49 AM PT

Sramana,
Whae are you proposing in a multi-dimensional content?

Raj Wednesday, May 20, 2009 at 9:34 PM PT

Multimedia, personalization, learning style based customization.

Sramana Mitra Thursday, May 21, 2009 at 10:48 AM PT

Sramana,
I don’t think technology would be the barrier of entry ,but creating the content would be.
I earlier thought content can be fed to the AI engine by forging partnerships with Textbook publishers.But I was told that content is proprietary and is one -dimensional.
Why is Content creation so expensive ?
A Math equation is same across any part of the globe ,only the context changes.

Raj Tuesday, June 2, 2009 at 1:25 PM PT

I don’t think you and I share the same vision of how this needs to be done, Raj.

Sramana Mitra Tuesday, June 2, 2009 at 3:34 PM PT