My first business was a failure… Here are five things it taught me


Thinking entrepreneurially isn’t something that happened instantly for me. In fact, it kind of happened by accident. I think I was dragged kicking and screaming into the business world.

I started my professional life in education teaching English to Speakers of Other Languages (ESOL) in both New Zealand and Japan. It turned out that this background was a pretty good apprenticeship because it taught me how to work with people on a lot of different levels.

This was before I started my first business, but working with people who struggled with English most of the time also taught me the first lesson:

1. There is huge value in making things comprehensible to others.

After I came back from Japan, the ESOL market imploded in New Zealand and I had to reinvent myself. And this was really the start of my transition from being a teacher, to thinking more like an entrepreneur, to being an entrepreneur… or perhaps an edupreneur.

Mostly, this is where I learned the second lesson:

2. Your first foray into business is likely to be fueled by equal parts desperation, fear, and crazy ideas.

I had a post grad qualification, and some great experience, including overseas, but I was on the dole. I had no money and I had a young family to support. What to do?

This is when I learned another lesson:

3. You don’t really choose.

The local unemployment office gave me two choices: join their team as a case manager, or apply for a enterprise development grant and become self employed.

I took the red pill.

One month later I had a small business crash course under my belt, a registered company, and a business plan.

The business course was basic, but the registered company was real, and my business plan was kick-ass. Then came lesson 4.

4. You don’t need a business plan… you need a business model.

Of course, it later turned out that no one wanted what I had to sell and what I really needed wasn’t a business plan, but a business model… a way of actually generating revenue.

Despite not really having any viable product or service to sell, going through the process got me the grant and a three month timeframe to start. I was “in business”. But then came the next lesson.

5. You have no idea what you are doing

My first step was to immediately squander thousands of dollars of the grant money on useless business software which I convinced myself I needed for contact management, lead generation, bookkeeping, and project management.

From there I drifted into the dullest kind of consulting work that you could never imagine: educational compliance.

Pick any really boring occupation, like tax accounting for example, and educational compliance trumps it for sheer dullness by a factor of 100. At least.

In fact, education compliance work is so boring that tax accountants (a usually humourless bunch) will laugh out loud when I describe this kind of work to them.

So that was my job for a while: I would help training providers, often the dodgy ones, sort out their compliance issues and occasionally write proposals to help them gain additional government funding.

The work would meet the brief in the eyes of the bureaucrats who were reviewing or auditing, often substantially. But in reality, it was mostly just a clever cover up for a lack of any real substance. A lot like my original business plan and business.

So that business failed. But it was a great learning curve.

The Rise of The Educator Entrepreneur

03 The rise of the educator-entrepreneur

Education is a tough business to work in. That holds true if you are a tutor, trainer, an educator of some kind, or a business owner. Or all of the above like me.

I think a lot about what I need to do to survive and thrive in the rapidly changing educational landscape.

The answer, or at least, the answer for me, is thinking like an entrepreneur in education. I do have my own business but I don’t think that is a prerequisite.

There is still a certain kind of entrepreneurial thinking that anyone can apply to their work in education, teaching or otherwise, that can help you create, innovate, and manage the disruptions, the challenges, and anything that your boss, a funding agency, or anyone else can throw at you.

How does ALEC’s business model work?

ALEC Education Business Model for blog bmg

ALEC’s business model is something that we have given a significant amount of thought to, especially in recent years. As a government-funded training organisation we are fortunate to have access to a dedicated funding stream for our main education product, the National Certificate in Adult Literacy & Numeracy Education (Vocational/Workplace) – otherwise known as the NCALNE (Voc).

The funding stream for this is known as the Adult Literacy Educator Grants (ALEG) and currently subsidises a big chunk, but not all, of the costs of the training. We pass on other training costs to the organisations we work with as fees for training and assessment.

The level of uncertainty around this funding has increased in recent years. And while we have a product that is in demand, our increasing lack of confidence in the existing funding stream has forced us to consider ways to drastically reduce our fixed costs and become a much leaner organisation.

We use the Business Model Canvas to describe, visualise, and assess our existing business model. You can see the latest version (May 2014) above following our recent restructure which included closing our local offices and shutting down our local Intensive Literacy and Numeracy (ILN) programme that ran from 2010-2014.

Click the image if you want to see the detail. Yellow sticky notes represent what we’re currently doing or working on, and pink stickies are area where I think we can grow, improve, or develop.

Any thoughts?


Is it possible to apply lean thinking and lean methodology to adult education and teaching?

I’m not sure if this works or not, but I’m interested in the idea of applying the principles of Lean Thinking and Lean Manufacturing to adult teaching, and to adult literacy and numeracy education in particular which is my field.

I’m not an expert on Lean, but I have read and listened to bits and pieces on the subject including Eric Ries’ The Lean Startup which applies the principles to entrepreneurship and business development.

The Lean Startup

I like Ries’ model as it’s simple enough to get my head around. What I’m going to do below is probably guilty of wrenching it out of context, but I want to see if I can make it apply to my own teaching context. So, the framework is from The Lean Startup, but the content is from my own work doing professional development in the field of adult literacy and numeracy education.

Here’s the result below. I’m paraphrasing Ries in places and copying his words directly in others. Tell me what you think in the comments.

  1. Entrepreneurs are everywhere/Innovative teachers are everywhere.
    • Here’s my take on Principle 1: Teachers, trainers, and tutors are entrepreneurial in the sense that they are often innovative and creative in their jobs for education providers. And you don’t have to work in a school or traditional education or training provider to be “in education”. Perhaps I could cannibalise Reis’ definition for a startup and transfer it into education… It might go something like this: “An education provider is any human institution designed to facilitate learning and teaching often under conditions of extreme uncertainty. That means that innovative teachers and trainers are everywhere including inside companies as well as more traditional training providers, and that this approach can work in any size organisation, in any sector or industry.
    • Application to adult literacy and numeracy education: trades trainers and vocational tutors often work with difficult learners. The same is true of industry trainers working in company settings. This forces them to be innovative. By focusing on the underpinning literacy and numeracy skills as well as the key content areas, educators increase the likelihood of learning taking place.
  2. Entrepreneurship is management/Education innovation is management
    • Here’s my take on Principle 2: An education provider is an institution, not just a product, and so it requires a specific kind of management. Education is undergoing a transformation and so is our society. These changes are social and technological, but they mean that education management should be geared to contexts of extreme uncertainty with regards to everything from knowledge, to methods and approaches, to attitudes, to ways of engaging learners, to funding. The term “Educational Entrepreneur” should be part of someone’s job title in any education provider, especially as the organisation will depend on innovation for their future growth in the education market.
    • Application to adult literacy and numeracy education: Owners and managers of training organisations and companies that rely on education to sell their products need to create conditions for teachers, trainers, tutors, and others to experiment with new ways of doing things. For this to happen there must be an investment of time and awareness that some approaches will not work. There should also be an awareness that even in sectors where knowledge and skills are rapidly shifting and evolving there are basic underpinning and foundational skills around reading, writing, listening, speaking, numeracy, and critical thinking that are teachable and transferable, and that should be embedded into the content delivery.
  3. Validated learning.
    • Here’s my take on Principle 3: Education providers exist not just to produce graduates, disseminate knowledge about industries, products or other stuff, make money, or even serve their students. They exist to learn how to learn, teach and communicate their niche skills and knowledge areas more effectively, more efficiently, and in a way that helps them build sustainable education businesses. This learning can be validated scientifically by running frequent experiments with teaching and learning approaches that allow innovative teachers and educators to test specific elements of particular approaches, strategies, or learning activities.
    • Application to adult literacy and numeracy education: Education has had some version of this for awhile. We call it action research. What we need to do is link it to evolving new business models as well as extending expertise in our chosen fields. In terms of adult literacy and numeracy professional development we recognised early on that traditional lecture-based delivery was not going to cut it for trades and vocational tutors, so we rapidly switched to workshop delivery. Now that we need to get much of the training online we’re faced with a new dilemma: Our target clientele pretty much hate the idea of online learning. So how can we do this work online in a way that still resonates with our target learners?
  4. Innovation accounting.
    • Here’s my take on Principle 4: Education is now a performance managed industry. Measurement of every kind is everywhere and we’re not talking particularly about funding here. To improve educational outcomes and hold innovative educators and trainers accountable, we need to focus on the boring stuff: how to measure progress, how to set up educational milestones, how to help educators prioritise work. This requires a new kind of accounting designed for education providers – and the people who hold them accountable.
    • Application to adult literacy and numeracy education: Again, none of this is new to education. We have business goals set by our funding agency, the TEC. One of these is to deliver around 100 NCALNE (Voc) qualifications. However, what’s the best way to do this moving forward? We need smaller, more focused experiments that help us stay informed about how our most recent learners like to learn. Also, we teach that tutors need to use learning plans with their learners to focus teaching and learning on specific negotiated goals. We also have diagnostic and formative assessment tools to measure learner progress. But what’s the best way to stitch this together in a comprehensive framework for educators?
  5. Build-Measure-Learn.
    • Here’s my take on Principle 5: The fundamental activity of an education provider is to facilitate learning around particular niche knowledge and skills, measure how learners respond to training or interventions, and then learn whether to pivot or persevere. All successful processes within the education provider should be geared to accelerate that feedback loop. Sometimes in education we see this as follows: Test-Teach-Test.
    • Application to adult literacy and numeracy education: The great thing about working with trades tutors and vocational trainers is that they don’t care about all the academic BS. They often don’t have preconceived ideas about how to do certain things, such as teach essential literacy and numeracy skills. What this means is that once they are aware of what the issues are, and we’ve given them some tools to use to analyse their courses and training materials they often think of quite innovative ways of bridging the gaps between where their learners are and where they need to be. The trouble is that this process is not usually explicit, and it’s often invisible inside and organisation. It’s our job to make this process explicit, put some structure around it, and help those educators help themselves, their learners, and their organisations.

How I set up three new Facebook Pages and the impact of Facebook advertising

Actually, I’ve got three Facebook pages now. Compared to creating webpages on a standard website I can’t believe how easy it is. I’ve set up one for ALEC, another for SMART, and another for Cubical 496.

I set up the pages a while ago but we’ve really only been using the SMART page. I’ve recently been pumping the ALEC page full of photos. Cubical 496 is a Facebook Page for some fictional characters that I’ve created.

ALEC Facebook Page. This is the page for our literacy and numeracy professional development work. We teach the National Certificate in Adult Literacy and Numeracy Education (Vocational) which we call the NCALNE (Voc) for short. This is the new one.

  • The ALEC page started the campaign with around 12 LIKES. However, I set the daily budget to $10 and I’m going to run it for a week only. After one day I’ve got 52 LIKES. This seems like much better bang for buck than my previous campaign which was for the SMART page below. Total cost will be around $70.

Smart Facebook Page. This is the page for our local Taupo community programme which teaches literacy and numeracy and basic computing skills.

  • The SMART page has around 126 LIKES thanks to a Facebook advertising campaign that I ran a few months back. I ran daily ads with a daily limit of $5 or $10 over several weeks and across around 5 different ads. Total cost was around $600.

Cubical 496 Facebook Page. Here’s where you can learn about the exciting life and times of Witherington Smithers, Assistant Compliance Advisor to the firm of Grumpkin, Grumpkin, Potts, and Skubb.

  • Cubical 496 only as 8 LIKES, has never been promoted, and is just a fun diversion for now. If we can think of some product to sell we might promote it.

Flipped Classroom = Flipped Business Model for Education

I can’t seem to get this thought out of my head at the moment. It’s in the heading above, but to restate the case.

  • Flipped classrooms need flipped business models for education and ed-tech.

There’s lots of talk on the internet these days, at least in education circles, around the idea of the flipped classroom. There’s a wikipedia article on it. It’s not anything particularly new, but in a nutshell, flipped is…

a form of blended learning which encompasses any use of Internet technology to leverage the learning in a classroom, so a teacher can spend more time interacting with students instead of lecturing. This is most commonly being done using teacher created videos that students view outside of class time.

And the most famous proponent of this is Salman Khan and the Kahn Academy which you should immediately go and check out if you haven’t already. With 3000+ videos online there’s probably something there you can use.

However, the thing that interests me is the idea that a flipped classroom needs a flipped business model. With the costs of specialised knowledge plummeting towards zero in most subject areas and government subsidies continually being eroded, education remains a time consuming, labour intensive business with seemingly fewer incentives for businesses to remain in the game.

How are education providers going to stay in business let alone make a respectable profit under these and other conditions?

To be honest, I have no idea. However, here are some possibilities to consider for flipping your business model while you flip your classroom.

  1. Don’t sell education and training. Sell something else. Educational resources for example. Or something else. Anything really. People pay for that other product or service and get education and training thrown in.
  2. Run your current business model into the ground while you figure out the next thing. Still got some government funding? Think you’ve got another year or two under your existing business model? Then work like crazy to use your existing revenue streams to fund the next thing.
  3. Charge for credentials but not for training. This is one possible future for providers who have special accreditation. The information that your trainees need is probably available for free on the internet already. If not, then it will be soon. However, the official quality assured qualification and credential that you offer still has some currency. So charge for the credential and the credentialing process. Give the training away.
  4. Seek funding from other sources. This probably means that you then give the training away for free as well. It might be more trouble than it’s worth but some organisations may be interested in investing in your education business. There may be philanthropic reasons for this, particularly if you are a not-for-profit. Or you might be a good purchase. Macmillan Publishing, for example, seems to have set aside $100 million to buy up new ed-tech startups as they transition out of the traditional publishing industry.
  5. Consider how to leverage online business models for education. What if students subscribed to their training for a low monthly fee (like a phone plan)? What if you sold chunks of training content via an online shopping site? What if you made all your expensive print-based resources available for cheap download online? What if your course became an iPad app? Or a game? Or a series of iBooks or eBooks?

Or you could just get out of the education business altogether… By the way, Macmillan if you’re reading? I’d settle for a cool 1% of your slush fund. Just DM me on twitter. That’s @smith_graeme in case you haven’t got it already.

Any other thoughts on how to flip your business model for education? Let me know in the comments below.

Kids need teachers because teachers are essential to education

Kids need teachers, right? So do adult learners, right? Well… what if they didn’t…

In New Zealand, current budget reforms mean that schools and training providers are facing tough times due to reduced funding. That means some schools will lose teachers and will need to have larger classes.

And the teachers are revolting. I mean, don’t get me wrong – there are some wonderful teachers who really care about what they do. But there are some that ought to pack it up and go home.

But regardless of the budget cuts and austerity measures faced by schools and education providers there are some other questions we should be asking as well.

For example:

  • Do we actually need the teachers?
  • Or the schools for that matter?

Regardless of what you or I actually think, education is due for major disruption about now. The received wisdom goes something like this:

Teachers are essential, and in fact, indispensable to education. Kids and adults can’t possibly learn without teachers.

Right… Now consider these timeless words of wisdom (a paraphrase):

  • People want to read books printed on paper. No one wants to read books on a device, especially not a phone or a cold slab of steel and glass.
  • No one will buy something they haven’t seen from a company they don’t know thousands of miles away by credit card. It’s just another fad.
  • You can’t beat vinyl for sound quality. Or… DVDs are here to stay. And people will always have to pay for the music they want to listen to.

It’s an assumption that schools and training providers will always look and operate the same as they always have. Just because we currently have a system where one teacher stands in front of 25 or 30 kids all day does’t automatically mean that this is what we will always have.

It’s also an assumption that education requires teachers to teach people – kids or adults. Most of us learned stuff in spite of the education system rather than because of it.

20 years ago no one would have imagined a world of digital print (e.g. Kindle), online retail (e.g. Amazon, Shopify), and essentially free online music (Spotify), let alone such innovations created by companies like Apple and Google among many others.

What we have at the moment is an example of “lock in”. Governments and schools are locked in to a particular way of doing education. It’s inconceivable for them to start again with a blank sheet of paper. Yet this is what needs to happen.

Imagine a world where the industries of retail, print, and music were government funded. Imagine then what would happen when the inevitable budget cuts roll around. All the shop assistants; magazine, newspaper, and textbook publishers; and record labels would be out on the streets protesting.

Meanwhile, they blinked. And software ate their jobs.