Valued at $3.25B after a $650M fundraise, Good Unicorn Emeritus/Eruditus is on a mission to build a world where MIT and Harvard-level educations are accessible to all.
What’s a Good Unicorn? Of 835 Unicorns from 40+ countries, I’ve so far only identified 48 potential Good Unicorns in my research. Emeritus is one of them. Good Unicorns are in service of at least one of the United Nations Sustainable Development Goal. Emeritus is in service of Goal 4: “ensure inclusive and equitable quality education and promote lifelong learning opportunities for all.”
This was a thought-provoking, soul-searching conversation with Ashwin Damera, founder of Emeritus/Eruditus on How To Build A Good Unicorn (def: a startup valued at $1B+ that is in an undeniable force for good for our people & planet), filled with incredible nuggets of insight and wisdom. Let’s dive straight in.
Diana Tsai: So as you know, I specifically research and study Good Unicorns, not ordinary ones, but the ones that are actually changing the world for the better. And so I’d love for you to just start us off with just a little snapshot of Emeritus – how is the company really serving our people and our planet?
Ashwin Damera: If there’s one thing that I believe can change the future of humanity, it’s education. I grew up in Mumbai, and you see islands of prosperity and oceans of poverty. What’s the difference? Education. The person in the slum doesn’t have the money to go to a school. It’s not about fundamental ability. They have that. It’s the opportunity to be educated. That’s the very big picture of why we care about education.
At Emeritus, our mission is to make high quality education accessible and affordable. In a country like India for example, there are 14 million students in higher education, but that’s only 27% of high school students that graduate. In the United States, that ratio is 80% (of high school students go onto higher education). So if India was to get to 80%, you would have to create 100 million new seats in universities. You cannot do that in a brick and mortar way. It has to be online.
Tsai: How do you do that? Make high quality education accessible and affordable?
Damera: What we do is partner with elite universities like Harvard, MIT, Cambridge, and make their programs available to people who aren’t able to go to their campuses.
We believe in the core value of high-quality university experiences, so unlike companies like Coursera or Khan Academy, we’re focusing on the experience of education, not just content. It’s not about watching a few video lectures, but about experiencing an entirely virtual classroom, with cohorts of other students, getting feedback and live interaction with faculty, coming out of the program a different person than when you went in. 1/3rd of our learning is the frameworks, 1/3rd is actually doing it, and 1/3rd is interacting with your peers – social learning!
Currently we serve 250,000 students a year. Our goal is in 5 years to change the lives of a million students.
Tsai: What about in 10 years, 20 years, 50 years, 100 years? What kind of an impact will you be making?
Damera: That’s a great question, I’m very happy you asked it; for so many startups, when you say future, they think about the next 12 months, 18 months, the next funding cycle, the next billion-dollar raise. One of our investors is Sequoia and they have this term, Enduring Companies. What that really means is a company that becomes the category. Like, did you Uber? Did you watch it on Youtube? Is it on Netflix? So these are enduring. I would love for us to become an enduring company in the upskilling and reskilling space, and that may take 10 years, 20 years.
Tsai: I’d love for us to dig deeper into the hardest to solve education gaps. What role do you think Emeritus has to play in creating educational opportunity for those who need it most?
Damera: There are indirect and direct ways of approaching this. Indirectly, the 250,000 students we touched this year, many will be like Raja Shenai, who started her own company, and now employs about 200 people, many of them who are underprivileged and now have employment. And so the more we scale our high-quality university experiences online with our partners Harvard, MIT, etc, the more our students will impact their own communities.
The next step is how we can be more directly impactful at the grassroots level. That’s what we’re doing now. When we work in markets like India, Peru, or Chile, we partner with local institutions at a much lower price point, in the local language, to make high-quality education accessible. Because it’s not just an issue of price, it’s also language – right now 15% of our student are learning in languages other than English. If you go to Latin America, 90% of the populace and nearly a billion people, 900 million, can’t learn in English. So we need to provide high-quality education in their language.
And then after that, the third phase is to go into the local ecosystem, so we can work with governments to make more high-quality education accessible. I look at this all from the point of ‘high-quality’. Can we teach a $10,000 MBA and deliver the same experience as a $100,000 MBA? Maybe, if we remove the bells and whistles of a large campus. But could we do a $1,000 MBA? At a high quality experience? That’s the hard part, and what we’re working on solving. When we work with schools I often tell the faculty, you’re great. You’re teaching 1500 people in a classroom, it’s phenomenal quality. But if we don’t teach 500,000 or 5 million, how do we change the world? So I’m constantly thinking, how do we scale what we do?
Tsai: That’s right, how DO you scale what you do? What’s an example of how you’re trying to?
Damera: Well, one example is the learning facilitator. In this model you can have a class of 1000 people, break them up into groups of 100, each with a learning facilitator. Another example is leveraging technology. There’s this negotiation course we do with MIT and Professor Jared Curran, it’s very personalized. We created simulations, so if 500 students are in a class, you can come in at different times and see who’s available to negotiate, and it virtually puts you in four different roles.
Tsai: Like in an online poker room.
Damera: Yes, gamification in a way. And then you get your instructions, you have your conversations, the whole thing is recorded, and the simulation gives you feedback because it’s run a lot of simulations and know what you could do better. So then we can go from 50 to 500 to 5000 students with a high-quality, highly engaging educational experience. 50,000 or 500,000 I don’t know, we’re still thinking on that.
Tsai: There are a ton of companies in the ed-tech space these days. How do you think about competition?
Damera: In India alone, there are 14 million students in higher education, but that’s only 27% of the high school students that graduate that COULD be in higher education. In the US that percentage is 80% (of high school graduates go to college). To get to 80%, we would have to create 100 million new seats for students in India. You can’t do that with just one company.
Who’s your competition? That’s the wrong question for us. Education is so important, so large, we need so many to solve it. This is about educating a whole generation. It’s a larger social issue and we need all of us working on it.
Tsai: I love this. What you just said, for me, highlights the difference between a Good Unicorn and an ordinary Unicorn. It’s less about just “how do I build a multi-billion dollar company and out-compete everyone else” and more about “there’s this whole generation that will be left behind if we don’t have enough companies that provide education to these hundreds of millions of students.” So I think, you raised $650m recently and are now valued at $3.5B. Did you ever think you’d be at this point?
Damera: When we started the company, we never talked about becoming a Unicorn. It was not the goal. For our first six years from 2010 to 2016 we never raised money. We just proved product-market fit, one university at a time. When we did try to raise capital, VCs said you’re not ambitious enough, you spent six years finding product-market fit. This year we’re close to $500M in revenue. We just were so focused on the input metrics, not the output metrics. Because the inputs are what really matters, the outputs will come.
Tsai: I have so many questions. First, when exactly did you find product-market fit?
Damera: When we first put our courses online and at the end of the 10 week program, people rated us at a 4.4 or 5. The faculty was astonished because they would get these ratings in person, but never online. And that’s when we realized we had product-market fit, because we had achieved an incredibly high quality of education, online.
Tsai: What it sounds like is you’re literally taking the best of a university experience, gamifying it, adding data, figuring out how to make it experiential and interactive. I could probably dive into days of listening to you talk about the innovations you’ve made in the education space. But let’s dive into a bit of the mistakes you made along the way – what would you have done differently?
Damera: So many mistakes made! I always think of them as learnings. Well, one example was when we assumed the content and courses that performed well offline would do well online. Actually, online courses were way more skills specific, like digital marketing or coding, whereas leadership courses with high interactivity did really well offline.
Another was going global. Today, 2/3rds of our students are outside the US. But when we first went into the Middle East and then China, we thought we should hire an expat leader, and that didn’t work at all. We realized that to succeed in Latin America or in China, you need to get local leaders who understand the local environment, get out of their way, let them run the business the way that region needs. Different markets need total different experiences. For example, in India and China, students don’t like asynchronous lectures. They want synchronous lectures, and will even prefer to come to an internet cafe together to watch a synchronous lecture. We think, that could have been pre-recorded, watched from the comfort of your home, but no, they want that serious learning experience.
Tsai: Incredible, so we talked about mistakes, let’s now talk about luck. What’s the role of luck for you?
Damera: You can call it luck or timing, there are so many extraneous factors at work. I truly believe we are built on the shoulders of giants: Nokia, Facebook, Google, Linkedin. If they didn’t exist, we couldn’t have taken our online program to the Indian market and been successful. In other words, if we started in 2005, we would not have been successful. And if COVID had not happened, our online education technology would not have boomed. Who can predict COVID? A bunch of businesses shut down because of COVID. Are they bad entrepreneurs? And the company that did really, really well, did you suddenly overnight become a god entrepreneur? So every business has an element of timing.
However, you still have to seize the moment. You said poker earlier right? So you’re dealt a hand and that’s luck. How you play it is skill.
Ultimately, entrepreneurship is perseverance. My old Alma Mater, Harvard Business School, took six years to say yes to working with us. We pitched him in 2010, they said yes in 2016.
Outwardly, I’m ambitious. I want to change the world. I want to have impact. But inwardly, I’m modest. Because whatever we achieve, I still know in my heart-of-hearts, that a lot came together, beyond my control, to make this happen. So I had a part to play. But I am not the director, producer, or actor. I am just a cog in the wheel.
Tsai: I love that humility. So rare. I’m curious now about your role as CEO – what are your highest leverage activities?
Damera: The first is communicating the vision and values to our people. Six months ago, we were 800 people. Now we hired another 900. They don’t know the story. Why do we exist? This is where our mission is an asset, because when I sway, look, we’ll be a $2B revenue company 5 years from now, it doesn’t resonate as much as look, we’ll touch the lives of 1m participants and indirectly, 5m people.
The second is a framework called Box 1, Box 2, and Box 3. Box 1 is stuff that needs to be done today, to meet fiscal goals. Executing on existing programs. Box 2 is forgetting all assumptions and policies. Forget that we only work with universities. What if we worked with authors to turn their books into classes? And Box 3 is what we don’t do today, and my job as CEO is to plant all those seeds for Box 3, today. To assemble the teams around those seeds, because in Box 1, 9 out of 10 things you do will be successful. In Box 3, only 1 or 2 of 10 might be successful. Box 3 is not about doing stuff 5 years from now, it’s about doing something today, that might make us successful in 5 years.
I spend 60% of my time on Box 1, 20% on Box 2, and 20% on Box 3. By the way, this is not my framework, I’m borrowing from one of the great teachers, Professor Vijay Govindarajan at Dartmouth, one of our first online courses.
Tsai: That’s an incredible framework and I love that you have to point out it isn’t yours. What is your definition of success?
Damera: I define success as trying, failure as not trying. Success to me is input metrics. How much you try. We live in a world that measures output metrics, dollars, money raised. So yes, we raised $650M and are valued at $3.5B but we are doing the same thing that we were doing for the last 11 years. When the input is right, the outputs come.
Tsai: Love this concept of input metrics. What are your input metrics for your own life, and role as CEO?
Damera: I want to measure my life by how many people’s lives I’ve touched. So my input metric as CEO is can we touch one million students in five years. As a consequence we’ll be making x billion in revenue, I mean obviously we can model it out. But my big hairy audacious goal is to help a million students.
On a personal level, I’m spiritual, I meditate, and my personal goal is: how do I be in the world, but not in it? It’s difficult to explain that. But it means to do all you need to do, but don’t be attached to the results of what you’re trying to do. I don’t even know if this makes sense. It means, you’re spending so much time pushing the company forward, and then when you come home, just act as if none of that matters. You’re an insignificant person, doing your part, just go on with life. It’s very difficult, and one of my personal goals is to find that balance.
Tsai: This is so much wisdom. In the US, everything is so output driven. This is such a grain of wisdom, thank you.
Damera: Yes, there’s this perception that you have to be this badass person to succeed. I don’t subscribe to that at all. I can’t say I’m a good person because that’s being immodest. But, I would say I have my heart in the right place and good values. That’s why I was very touched by your email (to write about our story as a Good Unicorn). I was like, wow, someone actually wants to write about this! If you put your mind and heart to doing something that really is good, that’s beyond you, the world conspires with you to make it happen.
Tsai: I’m so glad to have met you. You give me so much faith in the world. On the subject of Good Unicorns, do you think it’s harder or easier to build a Good Unicorn or an ordinary Unicorn?
Damera: For me, it’s easier to build a Good Unicorn. Because I wouldn’t know how to do it otherwise. A lot of people talk about product-market fit. I believe in founder-startup fit. And I’m the kind of person who builds long lasting, trusting relationships. So working with universities to enrich others’ lives is a great fit for me. And great universities like MIT want a long-term partner. So this is a natural fit for me. Now, if I had to go start a cryptocurrency startup, which might be banned in parts of the world and you figure out that problem, no, that’s not for me. It would be difficult for me to get up every day if my startup was just about making money and not touching people’s lives. That’s why, even though we’ve received acquisition offers, it didn’t make sense, because we feel we are doing what we want to do. So, Diana, I fit into what you call a Good Unicorn.
Tsai: Ashwin, thank you so much. I’m grateful to have met you. I love the way you think, and your entire spirituality, is very unique. Honestly I had no idea who I was going to find when I started looking for Good Unicorns. I didn’t even know if founders like you existed. I was like, I’m an optimist. I’m hoping there are founders out there that actually stand for what they say. So for me, when I find the real thing, I’m like, wow, this is really a Good Unicorn, and it brings tremendous joy.
Damera: What you’re doing is very interesting, very important. Because you’re writing about values and doing good, companies that actually have a good impact. They do exist, and they can be built the right way. I’m so glad you found me and gave us the opportunity to share our story.
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