McGraw Hill has just acquired Achieve3000. Stuart is an EdTech veteran who discusses the pre-K-12 literacy gap, personalized learning, as well as open opportunities in B-to-C education models driven by Covid.
Sramana Mitra: Tell us a bit about your own background and introduce us to the company. Let’s get acquainted.
Stuart Udell: I’m the CEO of Achieve3000. We are a leading provider of educational technology solutions, specifically in digital literacy and digital math solutions for pre-K to 12 grade students. We are known for getting accelerated outcomes. We tend to do a lot of work, not exclusively, with struggling students who need to make more than one year’s growth in one year’s time so that they can better access and have better equity in the educational community.
In terms of my experience, I’ve spent the better part of my career in educational technology. I’m a four-time CEO. I did a couple of presidencies in larger companies before that. This is a really exciting company doing great work.
Sramana Mitra: Let me start by understanding the customer you’re selling to. Are you selling to school systems, districts, or directly to school? How do you go to market?
Stuart Udell: Our go-to-market is largely organized around selling directly to school systems. We tend to work with larger school systems. We are in 72 of the 100 largest in the country, and we are in 9 out of the 10 largest. We do sell to schools individually as well. We have a freemium product that’s selling to teacher level. That opens up the funnel for us to create leads and generate demand for larger opportunities. We tend to focus mostly on directly selling to school districts either to the superintendent, the deputy, or the chief academic officer. We tend to do well mostly in medium to large sized school districts.
Sramana Mitra: What kinds of numbers are we talking? Let’s say you’re in the 70 plus of the largest school systems. How many students would that have and what percentage of those students are struggling that you impact?
Stuart Udell: That depends largely on the district with whom we’re working. We work with some districts where more than 80% of kids are below the poverty line. If we look at very large systems like New York, LA, and Chicago, we’re dealing with 1.8 million, 750,000, and 500,000 kids respectively. In many districts, we work with all students.
In some districts, we work with certain populations like intervention students. We might work with English language learners in some districts. In many of the districts with whom we work, we work with all kids in the district. If we look at a large district like Clark County, Nevada, we work with all 330,000 students or so in the school district. That district has an enterprise license with us. They can access all of our platforms and products as needed.
Sramana Mitra: I’m going to go in a bunch of different directions in the next part of the interview. One, let’s start with the product and the model of how students are using the product. What is the infrastructure? How are teachers engaging? How are parents engaging to come up with a good outcome?
Stuart Udell: Our flagship product is actually the name of the company – Achieve3000. It represents two-thirds of our revenue. What Achieve3000 Literacy does so exceptionally well is that it’s built to provide equity and access for kids. It does that by helping the teacher differentiate instruction in the classroom. That’s something that all teachers think about.
If I’m a 5th grade teacher and I’ve got kids reading at a 1st grade level and 10th grade level, how do I handle that? We serve up articles. We have this repository of 20,000 existing articles. If a teacher wants to grab an article on Martin Luther King or tectonic plate shifting, that’s all there. The teacher grabs the article and assigns it to students. The secret sauce is that every article is served up at 12 different reading levels in English and even Spanish. There’s translation in 70 other languages.
For that 5th grader kid reading at a 1st grade level, his passage is shorter, the vocabulary is less difficult, the sentence structure is less complex. It’s the same article. The kid reading at 10th grade level has a longer passage, harder vocabulary. The kid who needs Spanish support can toggle back and forth between Spanish and English. That notion of providing content to a child right in their zone of proximal development is very helpful. Kids learn best in their zone.
It’s hard enough to challenge kids to grow but not too hard to cause frustration. To get to your question about how does the teacher use it to engage, now that every kid has read the article and answered some questions, that gives us data to know exactly the ability of the student to comprehend it. That data feeds an algorithm that allows us to adjust the student’s reading level.
We continue to serve up the student content as per their exact reading level. Specifically, the level that stretches them just a little bit. Since every kid is engaged with the same content, the teacher can have a robust conversation in the classroom. That’s what a lot of parents care about. How do we take relevant issues in society and have robust conversations about them in the classroom.
Our product is used in a lot of adult education situations as well. As an example, we are used in all 35 state prisons in California, at least, on the male inmates side. The prison population has adults who are reading at a much lower level on average than they should be. We’re trying to reskill them so they can reenter the population with stronger skills.
The uniqueness and the brilliance about the product is that it can be used up and down all age levels. The power is how the teacher then brings that topic to life in the classroom. If we teach in the old way and we all read something that’s too hard for me to understand, I can’t even access the classroom discussion.
Sramana Mitra: When the teacher is assigning this reading through your product, is the student doing that reading at home?
Stuart Udell: Before COVID, about 46% of our reading was done after school hours. Since COVID, that number jumped to the high 80s and even touched 90%. The nice thing is, there are lots of flexible models that can really work here. The student can read individually at home. Then the discussion can happen in the classroom the next day. The classroom can mean physical or remote. Then there are lots of teachers who will tell kids to silently read for 15 to 20 minutes and discuss in the classroom. It’s a very flexible implementation model.
Sramana Mitra: Could you talk about your go-to-market strategy in a bit more detail? You talked about a bunch of segments. You’re selling directly to school administrators. You’re selling to teachers. You’re selling to prison systems. Do you sell with a direct sales force?
Stuart Udell: The primary go-to-market model is a direct salesforce. We have about 40 quota-carrying sales reps and a regional sales structure above them. We support them in a number of ways. From a top-of-funnel perspective, we have one product that’s a freemium model.
As teachers within a building start to engage more, we then try to branch out to the building through sales development reps. Ultimately, we try to take it up to a district-level conversation. The other way that we try to drive highly-qualified leads is through events. Most of those events have been virtual.
Our mantra for any event is there must be something newsworthy in it. If we’re going to do a webinar or a live get-together, we want something to talk about. It could be a new research report. It could be new features and functionality in our product. It could be almost a market research type. We often bring in thought leaders. We have an academic advisory council. We also have partnerships with some of the most noted thought leaders and professional speakers in the space. That tends to drive a lot more people to the events.
We might generate 300 to 500 leads in the typical online webinar. We have our sales development reps [SDR] qualify those leads further with the ultimate goal of providing a meeting for our direct sales representative who is out on the field. Then at that point, the handoff occurs. The outside or direct rep goes out to meet with the customer either virtually or in-person.
The other thing that we’ve done is, we tend to do a lot of work with these large organizations. We also have very complex sales in a lot of cases. We have a strategic sales team that focuses on large opportunities. They overlay with the direct sales team. We have a commission-sharing arrangement where everybody gets a big enough cut that they’re presumably happy with the outcome.
As a hundred-million-dollar business, we maintain a very flat organization. I, along with several other Vice Presidents and Chiefs, am very active in the sales process. We get out there and engage. Despite a fair bit of success, we want to stay as close to the customer as possible.
Sramana Mitra: We’re hearing a lot about going into accounts through the teacher network. It seems to be working really well. You’re reinforcing the point by getting products in the hands of teachers through some sort of a freemium model and getting people to start looking at the product. There’s a virality to this. It seems like you’re seeing a lot of that. Could you speak more to that trend?
Stuart Udell: That is a trend. Teachers do like to talk to each other. It’s not just because they’re chatty. When they try a product, they’ll usually talk to other teachers first in the same grade. Then the other teachers will try it too. Then they go to their principal saying, “We’re all trying this individually. We’d like to unlock more tools.”
In premium, we provide more data, more reporting, additional content, and things that are harder to access. It’s that migration that we’re hoping for. We only want to be used in schools if they’ve success. What we don’t want is to just sell something. When your customer is teachers and kids, getting it right is very important.
That’s why we like trials a lot. As you go larger, the implementation will go more favorably because folks have already tasted it. We have that positive word-of-mouth going. Buy-in is extremely important in any implementation. We do like when teachers talk to each other.
Sramana Mitra: Whether it’s social media platforms, where do these teachers hang out? Are there places where they’re congregating on a regular basis?
Stuart Udell: There are certainly several teacher social media platforms and tools platforms. Via API’s, we have done deep integrations with other leading products out there. There are a handful of types. The first type is student information systems. We integrate with Google classroom and other leading products. We want to make sure that it’s really easy for teachers to connect to our products and to share data across our products.
Similarly, we connect with some of the leading assessment platforms. We work with NWEA and Illuminate. Those aren’t necessarily social platforms, but when you look at a product suite like Google Classroom, it offers a broad array of tools, activities, and resources for teachers. Teachers use it in a social way.
Sramana Mitra: Very interesting. It used to be so difficult to crack into school systems. It was such a long sales cycle. With this whole teacher angle of being able to get into accounts through teachers, it has really smoothened and added velocity into technology adoption in the school systems big time.
Stuart Udell: That’s true. It’s been an interesting moment in time. There has been a slow 15 to 20 year migration from print to digital in schools. However, with COVID, it helped accelerate digital adoption by necessity. At the end of the day, we take the best of the old strategies, the best of what we learned and end up with a one plus one equals three situation.
Stuart Udell: I have the pleasure to be one of only two members of the EdTech community who are part of the American Association of School Administrators’ new commission for student-centered and equity-focused education. The goal of that organization is to create a blueprint for the future of American education.
While there was a lot of good in the old model, it’s not good enough anymore. There’s a ton of investment coming in. There’s a lot of private equity investment for the middle-sized and larger companies in the space. It’s a really exciting time for us to take learning to a new level. That’s true in the school level and in higher education.
Sramana Mitra: Tell me a bit about Achieve3000. How long have you been around? What’s been the trajectory? Is it bootstrapped? Funded? Private-equity funded?
Stuart Udell: We were founded 20 years ago. The founder bootstrapped it for the first decade. She took in some regional investors and friends and family funds. Over time, there was a need to accelerate growth and professionalize. She brought in private equity investors. About three years ago, she stepped out, and I came in. We are blessed to have Insight Venture Partners as our primary investor. They’ve been fabulous. They’ll do everything from growth equity on to major control positions.
We also are at a very interesting time. Just a couple of weeks ago, it was announced that we are being acquired by McGraw-Hill. McGraw-Hill, in and of themselves, was acquired by Platinum Equity. We will be joining forces. We have the storied brand in McGraw-Hill. Achieve3000 will be one of their centerpieces. We’re all very excited about it.
Sramana Mitra: Congratulations. You’ve been in this industry for a long time. From your vantage point, what are some open opportunities where you would encourage new entrepreneurs to start new EdTech companies?
Stuart Udell: The first place is to what COVID has done to shift the landscape. There are certainly lots of options. I would be excited about consumer education services for kids and families. We do know that with a lot disruption, lots of parents are unhappy or feel that there are challenges with remote or hybrid schooling. If I were thinking about deploying time, effort, and money, the consumer education space is very exciting in terms of providing direct services to kids.
Sramana Mitra: Homeschooling effectively.
Stuart Udell: It could be homeschooling. It could also be supplemental services. I’ve known folks who say, “I’m putting my kids in remote school. What else should I do?” I tell them to give them extra reading and math practice. I don’t care if they’re a high-performing or low-performing kid. High-quality and targeted practice is important for growth.
Then there are a couple of other areas. Literacy in general. We had 15 million struggling readers in the US before COVID happened. We do know that there is an acceleration of the achievement gap. They tend to have some correlation to socioeconomic disadvantage. The other area is career education and exploration – that notion of trying to take real-world opportunity, whether it be relevant college experience or career experience. What that means in terms of a product, I’m not sure.
Sramana Mitra: Wonderful discussion. Thank you very much.