Posts Tagged ‘start up company’

Are online learning platforms hurting colleges?

November 20, 2012 Leave a comment

This is not the first time I introduce the huge success that e-learning platforms as Coursera, Udacity or Venture Lab are achieving. The point is whether colleges already consider these platforms as actual threatens for their business model. I’ve just enrolled in my second course on Udacity. After a warm up with the Web Applications Engineering course, I felt like retaking programming. But this time I had a goal I didn’t bear in mind by the time I was at University: deploying a real (and useful) online website. That’s the reason I’m taking the Design of Computer Programs course right now.

Going back to the point, a few colleges decided to join Coursera as a shift to avoid losing competition from the very beginning. The problem is they can charge nothing for the course, and Coursera had 1.75 million users by October 2012. The whole number were not potential customers, but maybe a certain fraction was. As Coursera states on its website, you will find a course “whether you’re looking to improve your resume, advance your career, or just learn more and expand your knowledge”. Here we are, a real competitor for BSc, MSc and short-term studies.

Coursera website snapshotUdacity website snapshot

From my personal experience with Udacity, I’d point the following as advantages with respect to regular universities:

Flexibility. Classes are conducted by short videos and sorted out by units, so you can set your own pace depending on your time resources and knowledge. In a regular class, the flow depends on different factors that might have an adverse effect on advanced students.

Professors. Some of the most recognized professionals from high-ranked universities as Stanford, Harvard or MIT have joined this non-profit initiative. That means you can learn how to program your own self-driven car from highly motivated people as Sebastian Thrun, Google project’s fellow, or build your first blog with Steve Huffman, Reddit co-founder. This is miles away from the non-motivated, non-real-world professors you will find at Spanish Universities for instance.

Price. It’s free, that is, $0 down. While the US is facing a new financial crisis created by plenty of defaults on student loans (have a look on this NYT report), e-learning arises as a suitable solution for those  with limited resources who are not willing to go into debt, moreover with a scarce of jobs around. Perhaps this explosion might contribute to cut down prices and get a more affordable college education.

What do you think? Are e-learning platforms a real alternative for colleges, or just incidental tools?

Differentiate yourself

February 1, 2012 Leave a comment

While thinking of running a new business, trendy behavior consists of improving something it is already done. We usually consider: ‘If offer a similar product but introduce some new improvements, such as better quality, service or price, for sure I will pick up some market share, and consequently my business will be profitable”. This argument is valid but a little detail has not been considered. After regarding your appearance, your competitors would initiate a response that will lead your business to a price-based contest, affecting operative margins and therefore profitability. This is what Porter defined as a “zero-sum competition”, where every improvement developed by the company was directly collected by the customer, the supplier or a different agent, but not by the creator instead. This situation erodes the market long-term profit and consequently their members. For instance, the whole benefit created by the store brands is collected by the customer, by means of a huge margin fall, but not by the market itself.

Fortunately, it is always an alternative for everything in life. The point is: Why do not take a business no one else is currently operating? Why do not consider a completely different way to meet a market’s demand? This argument is the base of the “Blue ocean” theory, created by W. Chan Kim and Renée Mauborgne, whose original article has been included in the HBR Must-Reads on Strategy collection.

They propose you to find an opportunity and deploy a new product/service to meet its demand to instantly collect a market share otherwise not possible to be reached by a start-up company. Furthermore, you will become the market-owner and consequently will shape the competitive forces yourself, instead of playing a game whose rules were already invented a long time ago. Besides the wide range of advantages to differentiate your brand when arriving first, you may define your prices without attending to your competitors and thus getting a profitability many times higher to a crowded scenario, as done by Apple or Facebook.

This idea is not only applicable worldwide but also from a local point of view, since Internet has come to stay and everything is possible. What are you waiting for? Brainstorm new opportunities, evaluate your resources and go after it!