In 2011, Marc Andreessen’s Wall Street Journal article “Why Software is Eating the World” asserted that software would continue to disrupt new industries, with the next targets being health care and education.
This wasn’t a bold prediction to anyone familiar with education technology. From the dot-com era, entrepreneurs have dreamed of disrupting colleges and universities. A New York Times piece from 2000 titled “Boola, Boola, E-Commerce Comes to The Quad,” quoted the Dean of Harvard Business School saying “Faculty are dreaming of returns that are probably multiples of their lifetime net worth. They are doing things like saying, ‘This technology allows someone who is used to teaching 100 students to teach a million students.’ And they are running numbers and imagining, ‘Gee, what if everyone paid $10 to listen to my lecture?’”
The implicit assumption was that the software that would disrupt the university would be courseware. As a result, companies like Mike Milken’s UNext spent tens of millions of dollars developing highly interactive, rich media, simulation-based courses. But UNext went out of business, and a decade later the vast majority of the 3 million students pursuing online degree programs at U.S. universities were engaged in text-based courses that replicated the classroom model (i.e., lecture, discussion, assignment) as faithfully as possible.
The same assumption reared its head again in 2012, which the Times named “The Year of the MOOC.” Massive Open Online Courses were the next generation of disruptive courseware, but they proved even less disruptive than the first generation due to the lack of recognized credentials.
But what if the software that will eat the university isn’t courseware at all? What if it’s the online marketplace?
Uber (market cap $40 billion) owns no vehicles. Airbnb (market cap $10 billion) owns no hotel rooms. What they do have are marketplaces with consumer-friendly interfaces. By positioning their interfaces between millions of consumers and sophisticated supply systems, Uber and Airbnb have significantly changed consumer behavior and disrupted these supply systems. The online marketplace is the software that is eating the taxi industry and the hotel industry.
Is there a marketplace that could eat the university? There is, and it has 40 million college students and recent graduates on its platform. It is called LinkedIn.
LinkedIn CEO Jeff Weiner has been very clear about his ambition to become the software that eats the university. Here’s what he said just last week:
- We’re going to have a profile for every member of the global workforce.
- We’re going to have a profile for every company in the world.
- We’re going to have a digital representation of every job and every skill required to obtained those jobs offered through those companies
- We’re going to have a digital presence for every higher educational organization and university that enables people to obtain those skills.
- We want to make it easy for every individual, every company, and every university to share their professional development knowledge.
- In doing so, we will lift and transform the global economy.
What Weiner calls an “economic graph” I call a “competency marketplace,” the lead character in my new book, College Disrupted: The Great Unbundling of Higher Education. Competency marketplaces will profile the competencies (or capabilities — we’d benefit from a better word) of students and job seekers, allow them to identify the requirements of employers, evaluate the gap, and follow the educational path that gets them to their destination quickly and cost effectively. While this may sound like science fiction, the gap between the demands of labor markets and outputs of our educational system is both a complex sociopolitical challenge and a data problem that software, like LinkedIn, is in the process of solving.
LinkedIn is already providing tools like Field of Study Explorer and University Finder to recommend programs and universities to its massive young audience. It also allows students to automatically add competencies to their profiles from select online training providers and universities. In 2014, LinkedIn spent $120 million — its largest acquisition to date — on Bright.com, a company that had developed sophisticated algorithms for parsing competencies from job descriptions and resumes, and matching them.
If LinkedIn is able to achieve Weiner’s vision by adding an Uber-like interface atop Bright.com’s algorithms, it could find itself managing the competency profiles of hundreds of millions of professionals and brokering their human capital transactions with employers and educational providers.
Last week’s announcement that LinkedIn would spend $1.5 billion to acquire online training company Lynda.com takes this strategy one step further. So far, Uber has not launched its own fleet of self-driving taxis. And Airbnb hasn’t built its own hostels. But by acquiring Lynda.com, LinkedIn has signaled ambitions beyond owning the marketplace. LinkedIn intends to direct job seekers to its own courseware. “Imagine being a job seeker,” wrote LinkedIn Head of Content Ryan Roslansky in the LinkedIn blog post announcing the acquisition “and being able to instantly know what skills are needed for the available jobs in a desired city, like Denver, and then to be prompted to take the relevant and accredited course to help you acquire this skill.
LinkedIn’s competency marketplace is the “software” Marc Andreessen has been waiting for and that colleges and universities have long feared. And by owning the marketplace, LinkedIn is betting $1.5 billion that its own courseware will be disruptive as well.
Ryan Craig is a founding Managing Director of University Ventures, an investment firm focused on enabling innovation from within colleges and universities. He is also author of College Disrupted: The Great Unbundling of Higher Education (Palgrave Macmillan, March 2015).