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Send-off Announcement: Exiting Our Tech Startup

Keystone Learning Systems has had a great run. It’s been a tremendous journey. The time has come to say goodbye… And hello to new opportunities.

Carson Kahn
Oct 4, 2014 · 27 min read

Contents of this Letter

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What is Keystone?

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The first Keystone website was simple, just like our first products

Our Humble Origins

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“Keystone began as an informal collaboration among friends”

Broadening Our Horizons: OPUS

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“OPUS was our first effort to extend and commercialize the product”

Back to the Future: Research & Pivots

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“We engaged in intense market and competitor research initiatives”
  • As an institution, education in the U.S. is pretty awful.
  • There are very few advanced technology companies serving secondary education. Our friends at Schoology and Edmodo are the most prominent exceptions, but they have serious shortcomings in technology, design, and pricing.
  • Most of the action happens in higher ed, with billion-dollar corporations like Blackboard and Desire2Learn monopolizing college and university markets.
  • Many schools are using Content Management Systems (CMSs), but they really need Social Learning Communities Management Systems (SLCMSs/LMSs). The market for true LMSs in 2015 will grow to $24.2 billion in the United States alone. Worldwide growth is far larger, with compound annual growth rates of up to 30%.
  • When it comes to LMS/SLCMS companies, over two-thirds are commercial, fewer than one third are noncommercial, and there’s very little in-between. Just 32% of providers offer a free counterpart product.
  • Barely over half of these companies facilitate community support for their products, and on average, their proprietary support receives a rating of just 2/5 stars from end-users.
  • Fewer than 60% of ed tech providers are eligible for federal ERATE subsidies, which would allow public schools to pay less for technology upgrades. Ergo, the barriers to new tech in public schools are way too high.
  • While over 90% of providers are fully FERPA- and CIPA-compliant, just 70% comply minimally with federal/international accessibility guidelines, and 23% don’t comply at all.
  • Out of 166 elements known to be essential for effective Learning Management Systems, our average competitor incorporates only 85, or 51%. That’s a failing grade. (For reference, Keystone 2.0 aimed for about 137 elements, roughly 83%.)
  • The web technologies our competitors use are grossly out-of-date, with a fourth of providers scoring as low as 0/10 and no one higher than 6.4/10 in terms of perceived quality and potential (Petrovich Index).

A Phoenix Rises: Keystone Learning Systems

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“Our founders took the crowd by storm at the AACE EdMedia Conference”
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“The Keystone cofounders attended a series of preeminent industry conferences”

Breaching New Markets: Cocoa.io

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“Keystone’s Cocoa.io was the world’s first adaptive, community-driven VLE”
  • Trust as a decision-making factor
  • Attitudes towards online learning games
  • Opinions on social media
  • Important qualities of software
  • Individualization and personalization
  • Adoption rates of ed tech
  • Peer-peer communications
  • School branding

Diversifying: More B2C Ventures

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“A student’s portfolio layout in one of our beta-stage designs”
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“Keystone’s ILP was an outstanding idea, but way too labor-intensive”
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“Tracking assignments effectively is a key to student success”
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“In the world of education, everything is interconnected”

Dissolution: The Implosion

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“To enterprising entrepreneurs, too many opportunities can be a rabbit-hole”
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“Create user-centric marketing & interactive experiences that motivate, compel & inspire”

Pivots: Food for Thought?

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“Most successful entrepreneurs pivot their startups relentlessly”

Goodbye: Letting the Sun Set

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The sunset at Wonderlake Lake, near my home in Boulder
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“Data visualization is essential for communication, decision-making and productivity in every industry”
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“At IDEA, we live and breath productive collisions”

Lean Startup: Lessons Learned

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“Many lessons of many colors”
  • Good products don’t get built in a vacuum. Find your field and be the best in it. If there is no field, something’s wrong.
  • Starting with the right idea matters. Empirically speaking, you can only “pivot” so far.
  • Most investor advice isn’t great for building a magical product. No one can “help” you build a magical product — that’s your job.
  • User comes first. Product second. Brand third. No degree of marketing will help if you don’t have these priorities straight.
  • Working on the wrong thing for a month is equivalent to not showing up to work for a month at all.
  • Pick a small set of non-negotiable standards that matter to you most and enforce them ruthlessly.
  • Do everything you can not to attach your self esteem to your startup (you’ll fail, but try anyway). Every once in a while, get away. Go hiking, visit family, play racquetball, ping pong, anything. It will make you more effective and make the people around you happier.
  • Make sure it’s good enough and move on. Pick implementations that give 80% of the benefit with 20% of the work. Development speed is everything.
  • Quantify everything. Qualify pathologically. Don’t guess; measure. And prioritize ruthlessly.
  • Make promotional videos for your startup and each of your products or services. Video is the future of promotion.
  • Reevaluate effectiveness on a regular basis. Cut things that don’t work, double down on things that do.
  • Beware of chicken-and-egg products. Make sure your product provides immediate utility.
  • Product sense is everything. Learn it as quickly as you can. Being good at engineering has nothing to do with being good at product management.
  • Make most decisions by consensus, but have a CEO whose decisions are final. Your authority as CEO is earned. You start with a non-zero baseline. It grows if you have victories and dwindles if you don’t. Don’t try to use authority you didn’t earn.
  • Never fall in love with the fundraising process.
  • Avoid buzzwords 99% of the time.
  • Morale is very real and self-perpetuating.
  • Educating a market that doesn’t want your product is a losing battle. Stick to your ideals and vision, but respect trends.
  • Split the stock between the founding team evenly. Always have a vesting schedule.
  • Assume the market is efficient and valuable ideas will be discovered by other teams nearly instantaneously.

So, What Comes Next?

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Startup Secrets (#StartupSecrets)

Little-known, high-impact, often counterintuitive tips and…

Thanks to Ved Topkar, IDEA Cooperative, Keystone LMS, Cocoa, Michael Williams, Ryan Atallah, Ted Kornish, Nick Quinlan, and Ryan Singh

Carson Kahn

Written by

Working to improve 1mm lives. CTO, Volley.com. AI for learning, engineering for knowledge. NLP engineer, educational technologist, founder, designer, teacher.

Startup Secrets (#StartupSecrets)

Little-known, high-impact, often counterintuitive tips and tricks for succeeding in the wild world of startups. This is #StartupSecrets.

Carson Kahn

Written by

Working to improve 1mm lives. CTO, Volley.com. AI for learning, engineering for knowledge. NLP engineer, educational technologist, founder, designer, teacher.

Startup Secrets (#StartupSecrets)

Little-known, high-impact, often counterintuitive tips and tricks for succeeding in the wild world of startups. This is #StartupSecrets.

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