Could edX have become a financially viable nonprofit?


It is far too easy to criticize or question actions or decisions once the results are known. After all, hindsight is always 20-20, and too often retrospective criticism is just an expression of the critic’s ego.

Phrases like second guessing or driving in the backseat rightly carry a tone of disapproval. It’s easier to criticize than to create.

Nonetheless, it is always useful to look back and reassess past decisions, if only to avoid similar missteps in the future.

So let me put on my historian’s hat and embark on a re-examination, reassessment, and re-examination of edX, and ask if there was another way forward.

I’m not just a Monday quarterback. The organization I led, the University of Texas’ central system innovation unit, the Institute for Transformational Learning (ITL), faced challenges similar to those of edX.

We also received a substantial infusion of money as well as a mandate to ensure financial sustainability. We too have received a lot of conflicting and ambiguous advice on our mission. We too have had to pivot as circumstances change and recruit talent in an environment where the future is totally uncertain.

Marni Baker Stein, our Director of Innovation (and now Director of Western Governors University) designed our business plan. She’s one of the few people I consider truly brilliant and stands out in the world of higher education by combining two traits that are rarely found in tandem. She is a talented and experienced performer and also an education visionary.

Like Gaul, the ITL consisted of three parts:

  • Consultant: We were to provide campus advisory services, providing expert advice on promising markets, curriculum design, computer technology acquisition, analysis and other topics.
  • Programming: We needed to partner with campuses, colleges and departments to design, develop, deliver and manage cutting edge online programs.
  • Infrastructure: We needed to develop the infrastructure to support the future of higher education, including LMS overlays, interactive tools and simulations, and advanced analytics.

Unlike Calbright, we had no desire to compete with our component campuses. Instead, our role was to partner with UT’s college campuses and health science centers. In every area, we could provide services, tools, and resources at a fraction of the cost of a for-profit business.

But that, of course, depended on the campuses willingness to work with us rather than a for-profit provider. Given the fierce independence of each institution, collaborations with the system are not easy to negotiate even at rock bottom prices.

But the ITL was never intended to be another global campus for Penn State or the University of Maryland. We weren’t just an extension service or an online program manager. Our very name denoted our mission designated by the regential: to stimulate innovation in curricula, pedagogy and diplomas.

And that mission inspired our biggest project: to work with the Texas Workforce Commission, the Texas Education Agency, the Texas Higher Education Coordinating Board, and major Texas college and community systems to create a marketplace for post-secondary degrees across the country. ‘State, which would offer diplomas, certificates, certifications, modules and other marketable offerings.

Our aim was not only to make the extensive online programming offered by public higher education institutions easily accessible, but to develop tools that would guide users to the programs that best meet their needs.

Obtaining institutional buy-in to such a market was not as big a barrier as you might imagine. The campuses were eager to reach new markets and tout their distinctive advantages.

Ultimately, the ITL, along with a number of other system-level initiatives, came to a halt when the regents chose to downsize the system and redeploy central resources to campuses.

I believe we were about 8 months away from financial viability, but who knows for sure?

Yet what is striking is that the Roman Empire did not end in AD 476, but rather persisted in the East, and just as birds served as direct descendants of their dinosaur ancestors, ITL, in a sense, survived, as its extremely talented staff took on leadership roles in the higher education and edtech ecosystem.

ITL’s demise was not the first time that a system-level innovation initiative had come to a halt. The UT Online Consortium, created in the late 1990s to launch online programming under a common collective banner, also flourished for some time before it closed.

Parts of the consortium have survived, including a centralized course registration, credit transfer and counseling system. But the central vision, a sort of UT United, failed as campuses eventually decided to pursue their own separate online strategies, often in conjunction with PMS.

In other words, just as other state systems were expanding their online presence, the UT system backed off.

During the five years that I led the ITL, I learned many lessons:

1. How difficult is the procurement and contracting process in public institutions.

2. How resilient campuses are generally to systems.

3. How long does it take to hire and retain the right people and reach consensus on a business plan.

4. How easily is innovation disrupted by changes in institutional leadership, priorities and rivalries.

It’s hard to be nimble in a fast-paced environment in a highly regulated state nonprofit agency, even with the most amazing team I can imagine.

That said, one thing we learned to do was stay nimble by partnering up when needed and convincing our partners to work together. Sometimes our partners were small start-ups; at other times, industry heavyweights like Salesforce. But in any case, they agreed to make their tools interoperable.

So what could all of this have to do with edX?

Instead of following Coursera’s path, edX could have charted its own direction. To this end, he could have:

1. Been more mission oriented.
This would have forced edX to double its mission of access, research and innovation rather than striving for financial sustainability. I feel like edX would have been more sustainable if he hadn’t tried to emulate Coursera, but had instead matched its ambitions to the funds available.

2. Clarification of its added value.
For 2U, the value of edX lies largely in its global reach, its ability to market courses and programs internationally, the brands of its institutional partners. In my opinion, it would have made more sense if the value of edX, as a non-profit organization, lay in its technology and expertise.

The initial capitalization of edX, in my opinion, was sufficient to produce a cutting-edge learning platform infused with advanced analytics and supporting new forms of pedagogy and assessment. If necessary, edX can partner with other developers or modify and refine an existing LMS.

An alternative business strategy would have emphasized edX’s role as a driver of innovation: to develop tools, interactive elements and resources that would be available free or at very low cost throughout higher education. If edX had made a strong appeal to its member institutions, I think it might have persuaded them to share resources and content to support improvements in education around the world.

3. Served as a resource for the edX consortium.
Campuses face many common challenges, and edX could have provided consulting services and program development assistance.

The second guess is inevitably a form of arrogance. After all, we weren’t there. We did not know all of the facts, pressures and circumstances that ultimately dictated the strategy pursued by edX.

And now that edX appears to be worth $ 800 million, who am I to say that it pursued the strong strategy? $ 800 million is not money.

But I still believe that edX could have been something more than the course aggregator, platform, and marketing that it has become. It should have been the most important innovation catalyst in higher education, the largest not-for-profit inter-institutional provider of edtech education, research and development programs.

  • This could, in theory, have made colleges and universities less reliant on for-profit companies.
  • He could have developed tools and resources designed not to generate income, but to improve teaching and meet the learning needs of students.
  • It could have done what Josh Kim and Edward J. Maloney ask, serve as a catalyst for new programs in academic innovation, learning science, educational analytics, and edtech tool development.
  • It could have provided a vehicle for new forms of multi-institutional course sharing.
  • His consortium could have approached school districts to create first college / dual degree courses that truly aligned with college expectations.

I am sure that some will regard this strategic vision as an unrealizable dream. I myself am a humanist, and to the callous eyes of the public, the humanities are teeming with dreamers with no practical bones in their bodies.

But dreams inspire. Dreams motivate. Dreams create their own realities. And in order to thrive, edX had to pursue a dream that went far beyond commercializing paid programs.

So let me conclude with the heartbreaking words of poet John Greenleaf Whittier: “For all the sad words of tongue and pen, the saddest are these: ‘It could have been’.

Steven Mintz is professor of history at the University of Texas at Austin


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