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Ben Franklin Technology Partners Needs Your Help

Ben Franklin may have said “a penny saved is a penny earned,” but if the choice is between giving money to Ben Franklin Technology Development Authority or taking away 50% of their funding as the current PA budget proposes, then his quote should be restated as “a penny saved is a penny not invested and not simultaneously driving returns, creating jobs, and fostering an innovation culture in Pennsylvania.”

Ben Franklin has been one of the longest running and most successful state-sponsored seed investors in the nation and has been an example for many other states.  At Osage Venture Partners, we work closely with Ben Franklin Southeastern PA, where I am on the Board of Directors and where Sean Dowling is on the Technology Advisory Committee.  We also see the impact the other three Ben Franklin regional efforts have in their geographies across Pennsylvania.  The basic fact is that almost every successful technology company that has emerged from this region of PA has had the support of Ben Franklin early in their funding cycle.

WHAT CAN YOU DO?  Read the note below, click on the link, and seamlessly tell your state legislators how important Ben Franklin is to the region, to the state, to innovation, and to our future.  Let’s not harm things that are working and let’s focus on fixing things that are broken.  PLEASE ACT NOW.

As Ben Franklin once said:  “Without continual growth or progress, such words as improvement, achievement, and success have no meaning.”


Dear Ben Franklin community,

As an advocate of Ben Franklin’s work in stimulating the growth of the innovation economy of Greater Philadelphia, we’re calling for your support.

The latest proposed House of Representatives version of the Pennsylvania state budget contains a 50% reduction in funding to the Ben Franklin Technology Partners for fiscal year 2018. This follows a 50% budget cut the Partnership sustained in 2008, that has never been restored. The proposed allocation would mean that each of the four Ben Franklin Technology Partners would receive $1.8M in funding for company investments and support of our innovation economy.

We are calling for your help to ensure that Governor Wolf’s proposed allocation to the Ben Franklin Technology Partners is restored to $14.5M. Your legislative members need to hear from you—their constituents—about the value of Ben Franklin to you, to Southeastern Pennsylvania’s emerging technology sector and to the ability of Pennsylvania to compete in attracting talent in a changing economy.

We’ve provided an 
automated tool for sending emails to your PA legislators. Just plug in your contact information and click send to forward the pre-drafted message to your legislators, or edit with your own thoughts and words. 

Let Harrisburg know that full funding for the Ben Franklin Technology Development Authority through the Department of Community and Economic Development is the smart choice for Pennsylvania’s future. Please contact your legislators to urge them to restore the BFTDA line item for DCED to $14.5 million.

It is the support of leaders like you that have made Ben Franklin one of the most consistently successful engines for economic growth in Pennsylvania’s history. Yet without enough fuel, no engine can achieve its progress.

Your Partners with a Purpose,


Technology Innovation Along the Education to Employment Pathway - Part III

This is Part III of a series of posts related to how technology is enabling a re-imagination of the education to employment pathway.  Part II highlighted a few companies redefining to how skills and competencies are developed by both educational institutions and employers and discussed new delivery models for that content.  This final part of the series will touch upon how employers can create feedback loops to the educational system and how to create a more efficient process for matching an individual’s skills and competencies with job requirements that move beyond previous experience and a college degree.

Employers are increasingly partnering with educational institutions to leverage their content expertise to build more effective professional development programs.  One of our companies, ExecOnline, partners with executive education programs at top business schools like Columbia, Berkeley, and MIT to build online programs in strategy, innovation, operations, and leadership based in part on employer input that include a capstone project oriented around delivering real business impact.  ExecOnline then sells those programs to corporations, targeting the “missing middle” of managers and VPs that are too senior for programs from Skillsoft or Pluralsight, but also too large of a population to receive the expensive development initiatives targeted at senior management.  Starbucks made headlines a few years ago by announcing a partnership with Arizona State University through which all Starbucks’ employees would receive full tuition toward a full year online degree, committing to more than 25,000 graduates by 2025.  Guild Education is a startup that has partnered with employers to offer “education as a benefit” to employees, working with companies like Chipotle to offer employees guidance on how to best leverage the educational system to advance their careers, and WorkAmerica seeks to establish itself as a bridge between employers and community colleges so that graduates are prepared to enter the workforce after graduating with an associate’s degree.   

To help inform the design of such programs, employers are increasingly applying technology to analyze both the current skills of their employee base and the competencies required for success in certain jobs and the combination of experiences and training to design career paths that will set up the individual and organization for the future.  Comprehensive talent management platforms such as Workday and Taleo have become standard practice for large corporations, while a multitude of startups have developed solutions to track and manage training and career paths such as Axonify, PerformYard and a small investment Osage made last year into a company called BetterSkills

As the value of the primary tools for connecting education and jobs, namely a bachelor’s degree and job posting, evolve to incorporate competency based approaches, new technologies will be required to more efficiently match individuals’ skills with the jobs of the future.  Startups such as Credly and Degreed, together with the MOOCs, have begun to design credentials and micro-degrees that are meaningful to employers, while Portfolium provides students with the opportunity to create competency profiles by uploading papers, problem sets, and presentations that can demonstrate specific skills.  These companies aim to establish themselves as a trusted authority that can validate the quality of a competency based program or course or verify an individual’s competencies, a growing market need given the potential abuse of the system that can arise from this proliferation of credentials, something we at Osage have experienced first had as we have found several entrepreneurs or job seekers highlighting their Harvard “degree” that the small print reveals was a week-long online course. 

LinkedIn is perhaps the best positioned company to take advantage of this evolution of the education to employment pathway.  With data on the skills and experiences of millions of individuals, a deep understanding of what employers are looking for through its recruiting solutions, and now, with its acquisition of Lynda for $1.5B in 2015, a platform to deliver compelling training content, LinkedIn is uniquely able to make potentially lucrative recommendations to both learners and employers on how to match the right people with the right jobs.    

As we at Osage look to the future, we see numerous investing opportunities along this education to employment pathway, from continued innovation in how content is designed and delivered to a rethinking of the hiring process to better identify the required competencies and screen applicants for them.  We are therefore encouraged by the possibilities of automation to free human capital from rote and manual work to become more creative and enlightened and deliver the next wave of innovation, enabled by systems that promote lifelong learning.  There is data to support this optimism.  As the McKinsey study noted, previous technology shifts have resulted in massive transitions of the labor force; in 1900, agriculture represented 40% of US jobs, which has fallen to 2% today, while manufacturing represented 25% of US jobs in 1950 and fell below 10% in 2010.  The Economist noted that barcode scanners increased the number of cashiers and the number of bank tellers has grown since the introduction of ATMs, while McKinsey also cited a study in France in 2011 that suggested that for every job that had been lost in France as the result of the advent of the internet in the previous 15 years, 2.4 new jobs had been created.  To realize its full potential and minimize the possible downsides, the age of automation must be partnered with a similarly transformative rethinking of how to develop human capital, and technology will undoubtedly be at the center of that transformation.  At the same time, a number of questions emerge as both a citizen of this new world and as an investor hoping to identify the next wave of innovation.  Who ultimately bears responsibility for retraining the workforce – Individuals? Companies? Society?  (Singapore, for one, has identified a societal need and begun to provide a universal stipend for all of it citizens to access lifelong learning courses).  Where will the value accrue to address this massive need, to the developers of the educational content or the platform for distribution?  Regardless of the answers, there will undoubtedly be a wave of innovation, with technology at the core, all along the education to employment pathway, and we hope to capitalize on this massive market disruption, and at the very least, make investments that will help retrain us when algorithms eventually take our venture capital jobs.  


Technology Innovation Along the Education to Employment Pathway - Part II

In my previous post, I laid the groundwork for a discussion of how technology is enabling a re-imagination of the education to employment pathway.  This post will highlight a few companies and approaches related to how skills and competencies are developed by both educational institutions and employers and discuss new delivery models for that content.

We have seen interesting developments in both how educational programs are designed to develop skills, or to win edtech bingo, the pedagogical approach, and the delivery mechanism for skills development as an increasing percentage of education shifts online.  The trend of competency based education has gained momentum among educators, in which educational achievement is measured not by the number of credits earned or time in the classroom, but instead by what is actually learned – which happens on a different timeline and with different content for each individual.  Several universities have fully embraced this competency based approach, such as Western Governors University and Southern New Hampshire University’s College for America.  College for America has partnered with more than 100 employers, such as Anthem, McDonald’s and ConAgra Foods to design a curriculum consisting of real-world projects that is delivered entirely online.  Outside of the university system, groups such as General Assembly and Dev Bootcamp have created short, immersive programs to teach specific skills, such as mobile development or marketing automation, to help accelerate individuals’ careers.  Demand for such programs has grown tremendously, with more than 18,000 “graduates” across more than 100 learning accelerators and boot camps in 2016, up from just 2,000 in 2013. 

Online platforms such as MOOCs (Massive Open Online Courses) from Coursera or edX originally were created to democratize learning by offering free online courses from the world’s top universities, and have seen tremendous demand, with more than 60 million registered users across MOOC platforms in 2016, according to Class Central.  However, MOOCs struggled to develop viable business models and saw very poor completion rates as the courses initially had limited tangible value beyond learning for learning’s sake.  Coursera has shifted its focus toward developing certificates and even full degrees around professional skills, while other platforms such as Udacity have focused on more of a direct link to employable skills in specialized areas.  Udacity’s “nanodegrees,” created in collaboration with corporations, such as its Android courses designed by Google or a self-driving car program designed by Mercedes-Benz.  This unbundling of degrees into discrete skills and competencies, requiring less of an investment in both cost and time from learners, is a major trend for both universities and employers.

Online models have reshaped the education to employment pathway as the technology for designing and delivering content has improved and students have become increasingly connected.  Online education has entered the mainstream, as more than 1/3 of higher ed students in 2014 took at least one course online and 15% of students earned their degree fully online, representing more than $20B of tuition spend.  Higher ed no longer reflects the common perception of young kids heading off to campus for four year degrees; the National Center for Education Statistics estimates that by 2020 42% of all college students will be 25 years or older, while other estimates already suggest that non-traditional learners already represent the majority of students.  Such individuals are likely to have families and still be working, and thus have lifestyles ill-suited to spending significant chunks of time attending classes in-person and appreciate the flexibility and cost advantages of online models.  We at Osage recently made an investment in Noodle Partners, a next generation online program management vendor that helps universities design, deliver, and administer online programs by leveraging best in breed education technologies stemming from more than $10 billion of VC investment in the space over the last decade.  We are particularly encouraged by Noodle’s potential to help drive a continued blending of the online and offline experiences such that learners can benefit from hybrid models that best meet their individual needs. 

Corporations are increasingly recognizing the power of online delivery models and competency based education to revitalize their investments in business skills training, which Bersin by Deloitte estimates reached $20B in 2016 in the US, and was likely at least 2x higher globally.  Bersin suggests that “technology is revolutionizing” the corporate training market, with more than half of the hours consumed in training globally now delivered outside of a classroom-type setting, and expects that more cost-effective online delivery models will expand the addressable market further.  Forward thinking HR leaders are embracing the importance of training as a competitive advantage; in the words of Gail Jackson, VP of HR for United Technologies, “We want people who are intellectually curious.  It is better to train them and have them leave than not to train and have them stay.”  Certainly online corporate training has existed for a long time – we have all seen some version of a terribly awkward sexual harassment training video – with on-demand catalogs of content provided through a learning management system from companies like Skillsoft.  However, by incorporating the latest thinking in instructional design and technology advancements such as mobile and social, vendors such as Pluralsight or PracticeXYZ have made online training more interactive and immersive such that learning becomes a dynamic, interactive activity rather than passive ingestion of information.  


Technology Innovation Along the Education to Employment Pathway - Part I

Recently, McKinsey released a report that, depending on your perspective as man or machine, paints a potentially worrisome view of the future.  Based on a mind-numbingly detailed analysis  of all of the tasks conducted in the global economy, McKinsey estimates that nearly 50% of the activities done today have the potential to be automated based on currently demonstrated technologies in robotics, machine learning, and artificial intelligence.  This represents $8 trillion of wages collected by 1.1 billion people globally, and while the study suggested that less than 5% of today’s jobs could be fully automated such that humans are entirely replaced by robots, more than 60% of jobs could see at least 30% of their underlying tasks done more efficiently by machines. 

We are already seeing examples that cut across all areas of the economy.  Smart warehouses and factories where robots supplement humans, driverless cars threatening legions of Uber drivers – who didn’t even exist themselves five years ago, intelligent chatbots augmenting customer service representatives, a life insurance company in Japan replacing claims adjusters with the algorithms of IBM Watson, and even robot baristas.  As investors and entrepreneurs, the technologies enabling this age of automation – machine learning, artificial intelligence, cloud computing, robotics – offer tremendous potential.  McKinsey estimates that automation could add more than 1% to global GDP growth as a result of productivity gains.  At the same time, a reallocation of how work gets done will create winners and losers in the short term; estimates by McKinsey and the World Economic Forum estimate that somewhere between 5 million and 7 million jobs have already been lost to labor market changes resulting from automation.  Managing through the transition imagined by the McKinsey study and the WEF has profound social and political implications that I will actively avoid addressing – those are important debates for other forums.

Instead, I want to highlight some of the ways that technology has already begun to influence what Innovate+Educate and Whiteboard Advisors have described as the education to employment pathway, which requires re-imagination to better fit the unprecedented pace of change and innovation associated with this age of automation.  The World Economic Forum estimates that 65% of children entering primary school today will end up working in completely new job types that don’t currently exist, while one third of the skill sets required for jobs today could be completely reinvented in the next five years.  The current educational system, with a primary emphasis on a massive up-front investment into a bachelors degree, is poorly equipped to help learners constantly refresh their skill base, which is reflected in surveys such as a 2015 Gallup study that suggested only 11% of business leaders feel that college graduates have the skills necessary to succeed in the workplace or just 44% of students report that their post-secondary education prepared them for the workforce.  At the same time, corporations have dramatically reduced their investment in formal training programs (despite spending more than $130B on corporate learning in 2013, according to Bersin by Deloitte), with one study in the UK finding that the average hours of training per week fell by 50% between 1997 and 2009, as reported by the Economist, while another by the Bureau of Labor Statistics reported that the number of hours of training received by young employees fell from 100 hours in 1979 to 11 in 1995.  These factors have combined to create a perceived “skills gap,” with 40% of employers in the US reporting that they have positions they are unable to fill while there were more than 4 million open job postings during the height of the great recession when more than 11 million people were unemployed.  While several researchers have questioned the existence of the skills gap based on macro level data, very real issues exist at the micro level in certain pockets of the economy.  To take one example, approximately 50,000 open job specs in the US asked for a specific cyber security certificate, yet just 65,000 people in the US hold such a certificate, and it take at least five years of experience for someone to earn one. 

Innovators on both sides of the education to employment pathway have begun to recognize this disconnect between the skills employers require and the capabilities of the workforce.  Innovate+Educate, in their report Shift Happens, highlights a need for solutions across four primary areas.  First, how skills and competencies are developed by both educational institutions and employers.  Second, how this new content is most effectively delivered.  Third, how employers can use data and people analytics to better understand the skills required for the future and create feedback loops to the educational system.  And finally, how to create a more efficient process for matching an individual’s skills and competencies with job requirements that move beyond previous experience and a college degree.  Technology sits at the core of this re-imagination of the education to employment pathway, and in the remainder of this series of blog posts, I’ll highlight a few interesting companies and approaches across each of the dimensions.


Understanding Decision Fatigue and the Implications on a Start-up

The New York Times recently republished a very interesting 2011 article “Do You Suffer From Decision Fatigue”,

which describes academic research into the impact of decision fatigue on the quality of decisions.  Click on the link and read it because it may change how and when you make critical decisions.  Some of the takeaways include;

- As people make decisions, they become tired from the act of making the decision.  While assessing options and implementing a decision after it is made takes energy, the act of decision making itself is by far more taxing. 

- As people are asked to make more decisions, they will increasingly lean toward status quo or no decision versus continuing to make decisions.  Or they will go along with recommendations of others versus making their own decision.

- If you are already tired – at the end of a long day – the energy you can commit to decisions is much lower and your speed to decision fatigue is much higher

- Decision making burns glucose at unexpected levels.  Taking breaks and replenishing glucose can take away much of one’s decision fatigue and can reset the clock for a period of decision effectiveness.

The article talks about members of an Israeli parole board who were assessed on their decisions to parole similar convicts having been convicted of similar crimes.  It turned out that convicts in similar situations had a 70% likelihood of parole early in the morning and just 10% near the end of the day.  Percentages after breaks and after lunch also spiked but rates prior to lunch were quite low.  Across a broad number of cases, these behaviors became predictable and were attributable only to time of day, length of time since the last break, and time since the last nourishment. 

At Osage we think a great deal about decision bias and trying to remove as much bias as possible from the investment decisions that we make.  The writings of Kahneman and Tversky have become widely read and respected with regard to decision bias and we integrate these lessons in what we do.  But decision fatigue may also play a role in many of our critical decisions in ways that we may never be fully aware.  This made us also think about the thousands of decisions the leaders of our portfolio companies make and that their customers make and how decision fatigue might affect business success.

How does decision fatigue relate to start-ups:

Think about sales meetings: We don’t control what has happened during the day to the potential buyer of our software solution but unfortunately for us, this could be as critical as to what she thinks about your product.  So, when you can, schedule meetings or critical sales calls in the morning.  If the meeting is in person, bring a universally liked snack or two – dark chocolate squares, a five pound bag of M&Ms for a big group, vegetables and hummus – for afternoon meetings.  So many sales processes end with no decision.  How many of those fell victim to decision fatigue versus other corporate priorities?

Think about lead conversion:  A lot of analysis has been done about how lead conversion improves with speed of response.  Call in the first few minutes of someone filling out a form online and their conversion rate can be 4x higher than average.  Reaching out to people who fill out a form on weekends, early mornings, or late evenings have proven to be even higher.  There is a reason why a person who expresses interest in a product while surfing the web on a Sunday afternoon has a meaningfully higher conversion rate – their decision fatigue is low and the interest is high.  Getting back to them while they are in this state can accelerate sales cycles.

Think about management meetings at your company: Scheduling meetings in the morning versus afternoon may make a lot of sense.  Not making too many decisions in one meeting may be critical.  If you want to get something approved with little discussion, put it at the end of a long meeting agenda and make a strong recommendation.  Haven’t you noticed that people spend a lot of time discussing things early on an agenda but rarely take as much time to discuss things late in a meeting?  And remember, food for the meeting room could also be critical. 

Think about when you make important choices as a leader: As a decision maker, be careful of quickly agreeing with someone else’s recommendation or simply putting off the decision.  Are you really supporting this person and their preferred path, or are you tired?  Take a look at your calendar and think about the day – are you more taxed than you think? 

Think about hiring: How many interviews should you do at a time?  When do you stop listening?  I know that I have behaved like that parole board when I have been forced to do a ten session slate of interviews in a day with few breaks.  Sometimes it’s hard to listen or engage, and making no decision by simply passing on the candidate becomes the default as fatigue increases.  How many great candidates get rejected because the interviewer is simply fried from the process?  I was reminded of this recently when I was screening several hundred resumes from an MBA program resume book.  With decision fatigue in mind, best practice likely would have a person do this in thirty minute intervals and have a limited number of review sessions each day – and even better, to get several people to score each resume while putting each reviewer’s resumes in different order to make sure the same people were not given early preferential views by each reviewer.  No wonder people whose names are at the beginning of the alphabet seem to see more success.

Decision fatigue – be aware of it.  When you are in a position to make important decisions, ask yourself if you are mentally in the right place to be taking such an action.  If not – take a break, have a snack, maybe even sleep on it.   You won’t regret it.