🎧🍌 The Startup Teaching Two Year Olds How to Read | Niels Hoven, Mentava
The power of hater marketing, how education policy is holding back ambitious kids, early stage fundraising tips, parenting hacks, AI's impact on education, and the future of elite higher education
Niels Hoven is the founder of Mentava, building software to accelerate kids’ education, starting by teaching two year olds to read.
If his name looks familiar, you’ve probably seen him before. He went viral earlier this year when a hater tried cancelling him and Mentava for “working with Replit and Garry Tan to make kids productive and subvert child labor laws”.
As it turns out, most parents don’t want to teach their 4th graders algebra only to send them off to work. And the buzz generated a ton of excitement for what they’re working on. So much that they had to launch the product a year before they were ready.
We talk about the power of hater marketing, how public education isn’t designed for ambitious kids, product design from zero to one, how too much data leads to Frankenstein products, Seed stage fundraising advice, our top parenting hacks, why AI won’t have a big impact on education, and the future of elite higher ed.
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Timestamps to jump in:
3:49 Why schools don’t challenge overachievers
11:58 How a hater made Mentava go viral
18:14 The secret that teaches little kids to read
24:22 How people actually learn to read
27:35 2/3 of 4th graders can’t read proficiently
29:29 The downfall of one-size fits all education
33:44 How California almost banned middle school algebra
40:41 SF’s lottery system and how it impacts low income families
42:41 How COVID changed education
47:41 Early prototypes and going all-in on Mentava
50:56 Best practices from gaming in education
55:10 Raising a party round from lots of angels
1:03:03 Designing business models in education
1:13:19 Being pro-tech + anti-screens for kids
1:18:04 Top parenting hacks
1:22:53 How data-driven product design leads to Frankenstein products
1:25:34 Why gaming’s the best industry to learn how to build product
1:27:46 The trick Niels used to find startup ideas for 20 years
1:31:03 Why AI won’t be that impactful in education
1:36:28 What happens to elite higher education over the next decade
1:43:15 Admiring Stripe
Referenced:
Try Mentava
How Niels raised Mentava’s Seed round
Find Niels on X / Twitter and LinkedIn.
👉 Find on Apple, Spotify, and YouTube
Transcript - (read on Rev)
Find transcripts of all prior episodes here.
Turner Novak:
Niels, how's it going? Welcome to the show.
Niels Hoven:
Thanks a lot, Turner. Glad to be here.
Turner Novak:
I'm excited to have you too. I want to talk about a bunch of different things in and around education, the company Mentava you're working on, the interesting launch that you had that was unintentional. Can you really quick just tell us in 15, 30 seconds just what you're doing?
Niels Hoven:
Sure. So in education right now there are a lot of high achieving kids right now who are bored in classes that don't move fast enough for them. And we're trying to figure out how do we support those kids' learning needs? And the solution that we've come up with is to teach those kids to teach themselves, and to provide software, to sell it to support independent accelerated learning. Really our vision is we should see more kids reading in preschool, we should see more kids doing algebra in 4th grade, more kids doing calculus in 8th grade. How do we unlock the kids who want to move that fast and support kids across the whole range of abilities?
Turner Novak:
And I think the very first product that you ... When we first met, you were basically saying, "Hey, I can teach your two-year-old how to read." And I have kids, one that was almost two, and I thought, "That sounds ridiculous." Is it even possible?
Niels Hoven:
Yeah, it's absolutely possible. Not every two-year-old, but certainly there are some two-year-olds who are ready to read, and there's a lot of three-year-old and a lot of four-year-olds who are ready to read, and we can support them. And I think actually when I started Mentava what I was really interested in was getting into accelerated math and computer science, but what we realized is that we want to start at a young age and those kids don't know how to read yet. So we had to do reading and just get it out of the way in order to get to the meat of the stuff that I really want to teach later.
Turner Novak:
We actually found that with my eight-year-old, she has been a little bit slower, the nuance of reading, and she was struggling a little bit in math. And as her reading got better, she aces her math. She'll get 34 out of 35 of the questions right, and it's because it's a story problem where you just have to read it. And we were like, "Holy shit, she's actually really good at math." You just have to be able to read.
Niels Hoven:
So something that I talk a lot about is that the goal of education policy, a lot of parents don't realize, is that the goal of modern education policy is not to help every child to reach their potential. The goal of education policy is to close gaps between high achieving students and struggling students. And the problem is that when you just teach pure math in an efficient way, those gaps ... The kids for who math clicks just pick it up and start moving really, really fast. And a lot of those kids can get two, three, even four years of math in the given year.
And there are other kids who need more intense support to stay on track and understand what's going on. So how do you design a curriculum that closes those gaps? And one way to close those gaps is what you just described. It's like, "Oh, let's blend math and reading together." So that way if you have a kid who's really good at math, they can't get ahead because they can be slowed down by their lack of reading ability. And we can gate kid math learning by their reading learning, by merging those together and allowing those to gate each other. And I think it's a big mistake.
Turner Novak:
Isn't there this ... I think there's this thing called the Common Core, which is just what you need to learn at each grade level or something. I'm not super familiar. What is it exactly?
Niels Hoven:
So the Common Core is a set of national standards for what kids should be learning at any particular grade. And I think it was largely started I think from a good spot of wanting to make sure that nobody falls through the cracks. So let's make sure that they were teaching.
Turner Novak:
It's related to the No Child Left Behind thing, right? Which sounds great in theory, yeah.
Niels Hoven:
Let's not leave kids behind, there is a baseline level of knowledge that kids should be learning at at every given grade at a minimum. And I think unfortunately what we've seen happen is rather than saying that this is a minimum bar of knowledge, we see a lot of schools moving towards like, "This is the target level of knowledge." So every kid should be on grade level, at the same pace at each grade, and those Common Core standards are not particularly high.
So the Common Core standards foriaudi math for kindergarten are essentially count to 20, and the Common Core standards for 1st grade math is really like add the numbers one through 10, maybe some subtraction also. Adding and subtraction for numbers under 20. And so if you know a particular preschooler, you may very well know a kid who is done with 1st grade math at age four before they've even started kindergarten. And when they arrive at school they will be basically just spinning their wheels for the next couple of years because their school is not prepared to support them continuing to learn.
Turner Novak:
And why don't they support that? Is there something going on where if you're really good you ... What happens if you're really good? You're in kindergarten or 1st grade and you're starting to do multiplication, what typically happens right now in school?
Niels Hoven:
What typically happens is you just sit in your class and you relearn the same stuff that you've seen before, and you will be bored until the rest of the class catches up with where you are. There's a really sad anecdote from ... There was a book, what was it? I think it was called World Class or something like that. It was this mother who had traveled around the world, her kids had gone to school in Chinese school, French schools, stuff like that as she had traveled around for her husband's job. And finally they said, "Okay, we want to come back to the US, where is the best school system that we can find?"
And so they went back to Palo Alto because this was the best school district in the country, and their kids had already learned all the math that they were teaching in their grade level. And so their solution in the Palo Alto schools was to give the kids a book. Say, "Hey, just read your book during math class until all the other kids catch up." And I think she ended up pulling her kids out of there because she was just like, "What is this? Why are they refusing to support my kids' learning needs?"
It's this focus on equal outcomes, rather than equal opportunity. Right? I think a lot of policy makers say, "What is the goal of our schools?" And the answer to that is the goal of our schools is to be this equalizer, to close gaps, close achievement gaps, or close the gaps between high achieving students and struggling students. And the way that we see schools doing that overwhelming more than anything else is by removing those opportunities for those high achieving students to excel.
Turner Novak:
Because it does sound great in theory, let's teach every kid equally, let's make sure no one falls behind. I guess where does it usually go wrong throughout all of this?
Niels Hoven:
I think the way it goes wrong is it's not respecting the diversity of students' abilities and motivations. I think a lot of people want to approach education from this idealistic place where all kids are the same, all kids can learn the same thing at the same time at the same pace. And it's just not true. You have some kids who have already learned material, you have some kids who are able to learn this material way faster than other kids, and those kids get bored if their just sitting in space being taught something over and over again that they already know. You want to learn, you want to learn new things, and a lot of schools are not prepared to support those kids.
Turner Novak:
Could you say it's like sports? If somebody's just really good at baseball or something, or insert whatever sport, really good at hockey, they're good at skating, good shooting, and other kids don't know how to skate yet. It's like they're trying to teach all the kids to skate while this other guy is the next Wayne Gretzky or whatever.
Niels Hoven:
Right. It's like the equalizer mentality applied to sports I think would say, "Oh, there should not be a varsity team and a JV team. Let's not respect the fact that kids are looking for ... Have different abilities and are looking for challenges at different levels, let's hold back LeBron James and not teach him more advanced basketball skills until everybody is able to shoot a free throw at the same ability ... At the same level that he can." And it's just a good way to kill kids' motivations and to destroy the joy of learning for kids who used to really enjoy it.
Turner Novak:
Yeah. And I guess going back to Mentava and what you're working on, so when we first met you were doing ... Specifically what you were really dialed in on was teaching young kids how to read. You had not really launched yet, someone caught wind of what you were doing and started to very vocally talk a lot about it. What happened? Can you take us inside? You unofficially launched I guess, can you just take us inside what happened there?
Niels Hoven:
So we've been working on our early version of the software to teach preschoolers to read for ... I think we'd been working on it for almost a year at that time, and we probably thought we had about another year of work before we were ready for our big public launch. And then this way-too-online, ultra-progressive Bay Area activist got her hands on one of our early investor pitch decks and posted some pages and said, "Look at this terrible company, can you believe what they're doing? They want to teach two-year-olds to read. They want to teach four-year-olds algebra. Isn't that terrible?" And a lot of people looked at that and said, "I don't see what's so terrible about that. This actually sounds really great. How do I sign up? When is this company going live?"
Turner Novak:
Yeah. What was so bad about it? What was their rationale?
Niels Hoven:
I asked my team not to engage with her too much, because it feels like there has to be some level of mental illness going on underneath the hood. But she was saying that basically we are conspiring with Replit and Gary Tan to subvert child labor laws by making children productive at an earlier age. It was clearly just very off the deep end.
Turner Novak:
It was teaching them math and reading so then they could work and be productive members of the economy, but they'd be too young, so it's not fair or something?
Niels Hoven:
Yeah. I think it's not even that it's unfair, I think she was framing at subverting child labor laws. You can go back and find those little tweets of hers.
Turner Novak:
And they're not deleted, they're still out there?
Niels Hoven:
Yeah, they're still out there. I think the best thing about this is she did not back down. The entire internet, it became this pile on where the entire internet was like, "I don't understand what you're saying. This seems really crazy." And she was like, "No, I am not backing down." And the more that went back and forth at each other, the more visibility Mentava got. And we ended up getting just a ton of sign-ups.
So before this whole thing happened, we had thought, "Okay, if we can do a soft launch and get maybe 10 families in here using our software, that would be awesome. That way we can just iterate and learn from this small group as we go, as we keep improving our software." And I don't remember the exact numbers. We had 100 families? I may be overstating, we had a lot of families sign up and give us a deposit, which is wild because our software wasn't live at the time, we hadn't even submitted to the Apple App Store, we had no way to sign up and actually create an account on our website. The only thing you could really do is if you went through an interest questionnaire, at the end of that questionnaire there was a little link that allowed you to put down a $500 deposit for your first month of Mentava.
And people managed to find that and gave us so many deposits that we said, "Okay, I guess this is it. We basically exceeded our revenue targets for our first year, so we better launch now and get this software into people's hands."
Turner Novak:
Yeah. And weren't you ... You were profitable basically at that point, I remember you mentioned.
Niels Hoven:
Yeah. Our burden was so low that we could have cash deposited that month. We haven't managed to maintain that, but it was a pretty good month.
Turner Novak:
And like you said, the link, you didn't even really publicize the link, the questionnaire, right? Didn't someone find it? It was on Reddit or something that it got shared or something?
Niels Hoven:
We did not know where the payment link was on our site, and so we just knew that there was a lot of money coming in, we weren't sure exactly where the link was. And so one of the first things that we did as we were backing a lot of this was like, "Where was that link that people are paying for?" And what we found out was that we had essentially an application form like, "Apply to join Mentava." And it was a type form, and then at the end of the type form, in that confirmation screen, just briefly in that one screen there was a link there that said, "Make your deposit here." And if you didn't pay then, it was gone. And so that was where the link existed on our website.
Turner Novak:
That's amazing.
Niels Hoven:
So I think what we actually ended up doing is we told everybody, because we didn't have a sign-up process, we didn't have any way to create accounts, we didn't have anything in the app store, so we started scrambling to get all that stuff together. And we told everybody, "Okay, we're in beta now, and just hold on there." We gave them all our software for free and said, "This is the beta." And then while we built our billing infrastructure, and then eventually said, "Okay, we're ready to take their money."
"So here's the deal, you've been using our software for about a month, if you like it and you want to keep going then it's going to be $500 a month going forward." I think we said there's going to be a discount, an early adopter discount, so it's going to be $400 a month going forward. "If that's not what you expected or if it's not meeting your standards, then just let us know and we will just refund that deposit that you gave us a month ago. And this last month was on us." And we expected actually a lot of refunds because when that first "Cancel this company" tweet went out, there was a big focus on math and how we wanted to get kids to algebra in 4th grade, calculus by 8th grade.
And so a lot of people signed up expecting that we were going to have a math product, which is still a long ways off. And so we expected there would be a lot of refunds, but actually about half the people who signed up said, "Actually, no, please, this is amazing. It exceeds our expectations. I want to keep paying you money and we want to keep learning."
Turner Novak:
So I think an interesting lesson of it, of all of this is almost like haters are the best form of marketing. Is that true?
Niels Hoven:
Haters have aptly been our best marketing. Nothing drives our sign-ups like when someone decides to put us on blast. And I'm actually a little worried that our product may be getting too good to drive as much hate as it used to, because we used to get a lot of criticisms and "Oh, you can't teach two-year-olds to read, that's impossible. Or your software just doesn't work." But now we're starting to get case studies, now we're started to get videos, and it's like, "Oh, the software actually does work. Oh, actually a two-year-old can learn how to read." So I'm a little worried that we're not leaving enough fodder out there to generate as much hatred as we used to be able to in the old days.
Turner Novak:
Okay. So it works, how does it work? If I've never come across you or Mentava before and I'm hearing this for the first time, and I'm probably thinking like, "This guy's full of shit. He's just telling me my two-year-old can read." How do you actually do it and teach a two-year-old or a three, four-year-old to read?
Niels Hoven:
Right. So it's interesting. So people ask us like, "What is the secret sauce? How have you invented some new method to teach kids to read?" And it's a disappointment because we have to say we haven't really invented anything new, there's just this mystique that has been built up around reading to make people think that it's really hard. But it's actually not rocket science.
If you think about the process of reading, it is basically you learn your letter sound pairings. So B makes the bus sound, aah makes the aah sound. And then you start learning to blend those sounds together. So aah to makes that, that's your word. So there's the fundamental skill of blending, which is a fairly abstract advanced skill. A lot of times we see kids really ... That's the developmental readiness threshold that kids have to be at in order to do that blending, but once they learn how to blend then after that it's just a matter of memorizing the 44 sounds of the English language, and all the written letter pairings that are used to represent them.
So if you learn the blending skills and then you learn all the letter sound pairings, if you memorize all of those and then you're reading. And so really it's not a curriculum question, so much as it is a motivation and focus question. How do you keep a kid motivated and focused and concentrating for the 100 or so hours that it takes to memorize those 44 sounds and the way we write them in English?
Turner Novak:
And we probably teach them in a strange way too where we're getting them to memorize the letters, but then the letters don't always pair up to the sound that the letter even makes necessarily all the time. Is that true?
Niels Hoven:
Yeah. So English is ... There's a bunch of things about English that make it a particularly difficult language to learn how to read. So Spanish for example is a lot easier because every letter makes the same sound all the time, and every word is written exactly the way it looks like it should be pronounced. English is not like that. English has 44 different sounds, we only have 26 letters to represent them with, and so a lot of sounds are written with two letters like O-O or S-H or C-H, and so that makes learning to read English a lot harder.
Then we have letter names that don't necessarily reflect a sound a letter makes. So if you've learned that this letter is W, it might be hard to remember that it actually makes the waah. Or if this sound is ... This letter is called a C, but doesn't make a ess, it makes a cuh sound. So one of the things that we do in Mentava, I think Montessori does this as well, is that we really deprioritize letter names and say, "Let's focus a lot on letter sounds initially to reduce confusion." And you can pick up letter names later on, but we've found that it does help to just focus on the sound so you only have one thing to remember up front.
Turner Novak:
Yeah. And you do a lot with tactile feedback almost, like touching the letter and sliding while you say the sound too. I feel like that probably helps with memorization a little bit for younger kids.
Niels Hoven:
Yeah. So one of the interesting things is that we really try and pick apart these very specific skills that you need to learn how to read, and then do really focused practice on those individual skills. So for example, the letter sound pairings, learning that B makes bah, C makes cuh, et cetera, that turns out to be really easy. It's not that different from learning like, "Oh, this is a cow, the cow says moo. This is a C, the C says cuh." So kids can actually learn those at a really, really young age.
The real roadblock to learning how to read is the blending. Learning to blend those sounds together, learning that aah is not "D-aah, suh-aah, sow," it's sat. And so we put a lot of work into figuring out how do we represent that blending into an intuitive, visual, tactile way? How do we close this feedback loop? Do we really focus on training that specific skill? Because that specific skill is really the unlock for reading.
Turner Novak:
Yeah. It blew my mind when my daughter who was, I think she was three when we started using it, and she was getting it, sliding over, remembering the sounds. Like, "Holy cow, this is insane. Your sister didn't get this until a year or two later." And when it was just teaching her the letters, and then teaching the sounds, and it wasn't structured either. It was just for fun every night we'd read a book or two, and have her point at things. It wasn't very disciplined, it wasn't very motivated, we would always miss times.
Niels Hoven:
Yeah. It's neat, because in the beginning when we were teaching these skills we knew that blending was the important skill, and so the first step was just to say, "Okay, how can we make this software as good as a human teacher?" But then once you hit that bar then you realize there's a lot of things that you can do in software that human teachers can't do. For example, one thing that we like to do, the big count in blending is getting kids to get rid of the pause between letters. If you want to take ess and aah, they'll say, "Aah, aah." And you've got to get them to blend it together, "Thaa."
So how do you teach kids to get rid of that blending, that pause between letters? Older kids you can explain that to. If you have a six-year-old or a seven-year-old, and maybe that's why we don't like to teach reading until seven, you can just explain to them, "Okay, stop pausing between letters." And they get it. But what we've seen is that for a two-year-old or a three-year-old, they just don't even hear that pause. So they don't even know that they're doing it. So how can you solve that? We found out you can solve that by showing them.
So we can show them the visual wave form of their sounds, so they say, "Ess-aah." We show them the visual audio real wave readout, and you see, "Oh, there's that little pause in between the two sounds that you made." Then we had a bird fly across the top of the screen, so the bird flies as long as they're making a sound, and they pause, the bird falls down to the bottom of the screen. And then all of a sudden they can just realize, "Oh, I want to get this bird across the screen to the nest, I'm going to blend these sounds together." And we can do that in software in a way that you can't do it if you're just a human teaching in front of a chalkboard.
Turner Novak:
And it's interesting, I don't know if everyone else reads this way, but when I'm reading something you don't even look at the letters, you see the word like what, common, core, schools. You're not even sounding it out, you just memorize what school looks like, and in your head it takes you a fraction of a nanosecond to realize it. So you're not even really reading, it's just purely memorizing what symbols mean basically.
Niels Hoven:
Right. So actually this leads into a big debate over how do people learn to read, because essentially what happens is it's this process called orthographic mapping. And so you see the word for the first time and you sound it out sound by sound, so you see "At", and then you read it enough times and then your brain starts to recognize it as essentially a unit, and that's called orthographic mapping, then it stores it as a unit.
They're like you said, when you see the word you stop sounding it and just recognize it as the word. And so there is a school of thought that said, "Oh, can we just skip this whole sounding it out phase and just teach the words on their own?" And if you take a moment to think about it, you would be like, "Why are you doing this? You have basically just turned English into a pictographic language. There's a reason that Chinese is the worst language in the world to learn how to read, why would you get rid of all these cues?"
Turner Novak:
That's how they do it in Chinese?
Niels Hoven:
Well, as a pictographic language. You just learn all these like, "This picture means tree. This picture means thought." If you've thrown away all the phonetic info of the letters and you just say like, "This letter is ... This word is sat, this word is what." Then you've given away all those hints that you use to figure out what that word is. So basically it turns out that's not ... It's completely false. That turns out that having a phonetic alphabet is super helpful for learning to read, that is how our brain's work, but yet it remains this ongoing debate inside our schools about what the right way to teach reading is, despite the mountain of evidence that phonics and sounding out words is the right way.
And so anytime anybody asks me like, "Why don't you have more faith in the decisions that schools are making?" This is the example that always pops into my head. If our policymakers can not even align on the right way to teach reading, despite the mountain of scientific evidence behind phonics being the right way to do it, why would I assume that they have found the right path on anything else?
Turner Novak:
Interesting. Okay. So what is ... Maybe talking about schools or just education in general, are there any interesting things that most people probably don't know about the education market or the process of teaching people things? Any statistic where when you say it right when I'm done talking people's minds will be like, "Holy cow, that's insane." Whether good or bad, I'm just curious.
Niels Hoven:
Oh, man. I think something that I like to say is that I think the reason that most ed-tech founders fail is because of an oversupply of idealism. I think that people have ideas about how ... We want everyone to be the same. We want everyone to have the same abilities and learn at the same pace. And fundamentally that's just not true.
But a lot of people design education products for the world that they wish we lived in, right? In the world that we do live in. I think if you have the wrong mental model of the world, and if you build a product for a world that doesn't exist, it's very hard to make that product successful. And so I feel like some of the stats around what is the world like that we really live in, how do we build for that support that less popular worldview. So you have stats like I think the one you hear a lot is that two thirds of fourth graders cannot read proficiently.
Turner Novak:
Where would I find that stat? Is it like a US Education department publishes that or something?
Niels Hoven:
Yeah, there's annual standardized tests that we give to a selected random sample of US schools. And I don't know if it's like the NWEA program or something like that, but if you just Google, two thirds of fourth graders can read proficiently, you'll see that pop up.
Turner Novak:
Has that changed over time? Did it used to be higher or lower?
Niels Hoven:
It hasn't really changed that much. And I mean, to be told candid, it's a slightly cooked stat by people who are looking to say something bad about the education system because there's two tiers, there's acceptable and proficient, so there's a reasonable category of kids who could read acceptably. Still a lot lower than you would hope, and not very many of kids hit that proficient standard.
Turner Novak:
Interesting. Yeah, I think about my daughter's in third grade. She struggled with it probably. She's reading chapter books right now just for fun in her free time. And I don't know what hierarchy of this acceptable, proficient, where she would fall, but I'm like, "You're reading chapter books and you're doing it unprovoked." That is great in third grade, in my opinion.
Niels Hoven:
I think she's probably well above the standard.
Turner Novak:
And I think too, there's definitely been cases where personally growing up things I feel like I'm really good at now, there are times when I really struggled with certain things, so it helps me when I'm reflecting of anytime my kids are struggling with anything or something, I'm like, you know what? I used to really not be very good at this, and I know that this is probably, they just need a little bit of time. They just need a little bit. I need to show them patience and help them get through something that they might be struggling with. And I mean, they'll make it to the other side eventually.
Niels Hoven:
Yeah, I think that's one of my biggest problems with the one size fits all education mentality. So a lot of that work that we're doing is focused on high achieving kids and saying, because I think those are the kids who are most, I would say, ignored right now, because there's this attitude of like, "Oh, they're going to be fine, so we don't need to support their learning needs. Let's focus on the kids who are struggling." So you have this whole population of kids who want to be learning, who are not being given that opportunity, who are being deeply underserved, who are unhappy and bored in school. And I feel like someone needs to support those kids' learning needs.
But there's also this huge body of struggling kids who are also very badly served by one-size-fits-all education for exactly the recent that you described. Like, "Oh, they probably just need a little extra support. They're not ready to do the material right now that everybody else is doing." What they actually need is more focused support on the areas that they're struggling with so that they can either catch up or simply just progress at a pace that is more appropriate for them. And the one-size-fits-all education model does not serve those kids well either.
Turner Novak:
For example, I think generally you'd to learn to read before you start doing math. That's true, right.
Niels Hoven:
It doesn't have to be that way, but I think if you haven't learned to read, it does quickly become a challenge. You have to learn numbers and things like that in math too.
Turner Novak:
Yeah, I know one of the first guests of the show was Ryan Delk, Primer. They're recently opening. When you think of yours is very efficient capital, his model is much more capital intensive. They're opening schools or enabling teachers to literally open schools, building software for the teachers to run the schools and the classes. But one of the things he found was that when they would start helping kids get better reading, their math scores would also shoot up. And it was like, wow, they just couldn't understand the problems. I mean, exactly what I described with my daughter, we were like, "Wow, she's actually really good at math. She just needed to learn how to read first."
Niels Hoven:
Yeah, I absolutely believe it. The conversation we had about essentially schools being to take the math curriculum and wrap it in a reading wrapper. I hear so many stories from parents whose kids have dyslexia or something like that, or just behind on reading and in the old days would be able to do basically the simple math. They could do the addition, the subtraction. They would have the opportunity to learn the fundamentals of math. But now that math has been forced into this reading shell, they're basically blocked from learning math because of their reading struggles.
Turner Novak:
Any other stats maybe that you think might be really shocking to people with the education system?
Niels Hoven:
Yeah, I think so. One that is definitely not very commonly known, so there's this standardized test, the NWEA map test, I'm not even sure that the standard, but it's a national standardized test that we give to benchmark a bunch of different schools. And one step from that is that the median 12th grader gets the same scores on that test as a 99th percentile, second or third-grader.
Turner Novak:
Wow. So your average high school graduate, or sorry, your top achieving 7-year-old can score the same as an average high school graduate?
Niels Hoven:
Yeah, basically think about the smartest second or third-grader, and that is the level that we educate the median high school graduate to. It is also a statement about the diversity of abilities and motivations in our student body and how ridiculous it is that we try and impose a one size fits all curriculum on them.
Turner Novak:
Hearing that stat, there's a range of "Wow, that's wild." It's also a range of, "Why is that not talked about more?" It's also a feeling of like, "Man, could we increase the median for the average high school or all aspects of it?" I'm like, wow, that's insane.
Niels Hoven:
Yeah, there are so many ways to interpret that. You can say, "Oh, our standards are too low for our median and we should raise that." That's probably true. And there's also the statement about, "Wow, those really smart second or third-graders are really, really smart." Yeah, that's also true and we should support them better. And then there's that just idea that there's this huge diversity of abilities and motivations. How do we design a school system that can account for that? I think that's true also.
Turner Novak:
Well, yeah, I guess talking just broadly about the school system and interesting stories or facts, there was this time period where I think in San Francisco they actually banned teaching algebra in middle school, I believe. I think this story better than I do. What exactly happened?
Niels Hoven:
So this was a decade long period, and it's still kind of ongoing. So essentially going back to this idea of one size fits all education of how do you manufacture equal outcomes in schools, though in most places, algebra is usually an eighth grade course. If you are ready for it early, you'd be allowed to take algebra in seventh grade. I actually took algebra in fourth grade. I've heard kids who've taken it earlier.
Turner Novak:
Those second or third-graders that are super smart.
Niels Hoven:
Yeah, there's a range when kids are ready, just pick up and start learning these abstract skills. But I'd say typically in most places you do algebra in eighth grade and are allowed to take it in seventh grade. Well, San Francisco noticed that not everybody was passing algebra in eighth grade. And so what they said is that globally across the board, because some students are failing algebra in eighth grade, we are going to require every student to take algebra in ninth grade. So all those kids who used to take out for eighth grade, sorry, you're not going to do it anymore. Kids who used to take algebra in seventh grade, you're also not going to out your anymore. All of you'll take algebra in ninth grade.
Turner Novak:
So why is that the decision? Wouldn't they just try to teach you a little bit better in eighth grade?
Niels Hoven:
So they tried for what? They tried for a long time to get the pass rates for algebra up higher in eighth grade. And there are just some kids who were not ready for algebra in eighth grade. They were really struggling with it. So those kids, they needed an extra year of building up their fundamentals so that maybe they would be better prepared to take out for a ninth grade. And so what San Francisco said is, "But we can't have these disparities. We can't have this divergence in outcomes. We had to have the curriculum be the same for everyone. So everyone is going to have to do that at the same time and take algebra in ninth grade."
Turner Novak:
Is there a funding reason, like if you have a failure pass rate at certain levels, the school doesn't get federal or state funding depending on student outcomes?
Niels Hoven:
I don't think I've heard anything. I mean, I'm not deep into the weeds on that, but I don't think I've heard anything like that.
Turner Novak:
Yeah, because just thinking if the incentives are like, "Hey, let's just shift this up to make..." It's like lowering the bar. Let's lower the bar a bit so we can clear it and make sure we get funding. That could make sense to me if that was the reason for it.
Niels Hoven:
Yeah, I'd say a lot of these decisions are less practical than ideological. It's get rid of accelerated programs, get rid of gifted programs so that we don't have some groups of kids pulling ahead of other groups of kids.
Turner Novak:
And then it kind of "went well" and they were trying to expand it throughout the state, right?
Niels Hoven:
So San Francisco basically cooked the books on this as best they could. So I'm not-
Turner Novak:
What does that mean?
Niels Hoven:
I think if you dig into it, I think lying would be actually the appropriate word -to describe a lot of the stats that San Francisco is putting out there but-
Turner Novak:
What did they lie about?
Niels Hoven:
One outcome that San Francisco liked to brag about was that they said, "Okay, when we moved, when we had all the students start taking algebra in ninth grade, we saw the number of students who are forced to repeat algebra in ninth grade fall dramatically." And that sounds like it's a win. Fewer people were being ninth grade. What they neglected to mention was that they also got rid of the assessment test at the end of algebra that would force kids to repeat algebra. So basically instead of they just stopped grading kids to see whether or not they had learned the material and just allow them to progress to the next level rather than sit... There's no evidence that actually delaying algebra for a year resulted in markedly better outcome.
Turner Novak:
Interesting. So they lowered the bar and then if you tried to jump over the bar and you knocked it down, it didn't matter and you could just keep going.
Niels Hoven:
Yeah. If you just ran into the bar anyway, like we were just going to keep... They needed to see some sort of stats to justify the decision that they had made. And there's a whole bunch of freedom of information acts filed and pulling. I think there's still some requests for data that's like San Francisco has refused to share, but there's basically just no evidence that this was a good outcome and there's a fair amount of evidence that this was a bad outcome, that math outcomes for struggling students are now even worse than they were before. It just wasn't a win. But in the phase where San Francisco was really pushing this hard, during that 10 year period where they're saying, "Oh no, this is definitely a win. This is the right thing to do," this mentality was rolled into the new California math framework, which was going to set state standards statewide for all of California's public schools.
And it was really only through just a coordinated outcry from mathematicians and professors and academics and parents who said, "No, taking these opportunities away from our kids who want to learn math is a really, really bad idea." And I think that this one in particular got a lot of visibility because what happens when you take algebra in ninth grade instead of eighth grade, it makes the path to taking calculus in high school much, much harder. Basically that way in order to take calculus in high school, you have to double up on math in one year, or you have to take math in summer school or something like that in order to hit that. And that's a real problem because taking calculus in high school is a pre-rec for many college applications, or at least tests you up to take some of the more technical college majors.
So there have been lots and lots of cuss to accelerate education in math and science and things like that. But this particular was a big problem for parents because it hurt kids' college admission problem. And then when you think about, okay, which families did this really hurt on top of that? Okay, well, the families who have financial resources to take those summer classes to get a math tutor for their kids so that they can get back on track to doing calculus in high school, those are the families that were less impacted by this. The families that were really impacted by these decisions are the families who don't have those financial resources, who are depending on our public schools to set their kids up for college admissions, for the academic ladder, and that's who really suffers from these bad policy decisions.
Turner Novak:
Yeah, I'm trying to think of how it could be a good decision. I don't know, do you have an answer to that of how it could be a positive to teach kids less?
Niels Hoven:
It's a good decision if your goal is to close achievement gaps rather than to optimize student potential, then this is a good decision. Because basically the worse you teach, the less material you teach, the more there's achievement gaps close.
Turner Novak:
Yeah. Wow. Okay. So then you probably would be saying, well teach lesson in school and you shift more burden on to outside of the education system to learn.
Niels Hoven:
Right. And so with predictable results, if you look at where kids now go to school in San Francisco, so San Francisco has really optimized for equal outcomes. Your kid is assigned to a school by random lottery. They can get assigned to a school all around the city. You are not allowed to teach material above grade level. They're saying everyone is going to learn the same thing at the same time. And so where do kids go? Any family with the resources to do so, get their kid out of that system. So a lot of kids in San Francisco are going to private schools, whether it's super expensive, ultra fancy private schools or just the local Catholic schools, which are a lot cheaper, but have more rigorous academics. Or there's just like if as a family in San Francisco, if you go out on the weekends and you go to restaurants or whatever, you see that there's very much this age cutoff of there's a lot of kids under age five, and as soon as kids hit age five, the families flee the city because they need to get into a decent school system.
Turner Novak:
Yeah, it's pretty fascinating. I've definitely anecdotally heard that. Do you feel like there's any sort of, are there people in the education system like a teacher at a school that feels like this is going in the wrong direction? Are there teachers that are like, "I would actually like to try to teach kids algebra in sixth grade if they're ready for it?"
Niels Hoven:
I mean, teachers go into education because they want to change kids' lives because they want to see kids learning. And so I think it's hard for a lot of teachers to feel constrained by bad policy that says, "Oh no, you're not allowed to support this kid's learning needs. This kid knows this material already, but you're not allowed to allow them to continue progressing." And so when people ask me where I see the problem with schools is I really point my finger at the policymakers have bad policy who are tying schools hands and tying teachers hands and telling them that they are not allowed to support the high-achieving kids who want to be learning more. They're not allowed to support the struggling kids who need more focus on the areas that they're struggling with and have to focus on this one-size-it-all model that fails a lot of students.
Turner Novak:
Did the education system change at all during Covid? Like anything noticeable just between maybe 2019 and today-ish, like the past five years?
Niels Hoven:
Yeah, I think so. Yeah. I think one of the big things I think that happened during Covid was that there, for a lot of parents, there was a lot more visibility into what their kids were doing in school. And I think that contributed to a lot more parent dissatisfaction. It was like, "Oh, this is all you're learning and this is how fast a school is progressing. I sort of had higher expectations." And so we've seen a big shift. The growth of homeschooling has grown a lot.
Turner Novak:
Yeah, I've seen that in the data. Yeah.
Niels Hoven:
Yeah. There's a lot more interest in micro schools. I think parents are looking around a lot more aggressively for essentially alternatives to public education. And while in the past, this used to be driven by a lot of concerns around safety or values or religion, you're also seeing now a new group of parents who are saying like, "Oh, actually I have problems with the academic opportunities that my kid is getting, and I want to look for ways to better support them outside of our public school system."
Turner Novak:
It's a real bummer because you want a strong public education system that teaches people how to be functioning members of society and learn things. And if I'm running the US government, I make my money from taxing the money that my citizens make. I want my people to be super smart and learn how to make money so I can tax them and make a lot. Isn't that the goal?
Niels Hoven:
My kids go to public school. I went to public school. I had an amazing experience in public school, and I think a lot of people look at what we're building at Mentava and say, "Oh, you're trying to disrupt public schools. You're trying to create some sort of parallel system." And it's a fundamental misunderstanding of what we're doing. We are trying to save the public school system by allowing kids to be part of their local public school community to go to class with peers their own age in their local community, and still have the opportunity to learn and progress as fast as they want.
Turner Novak:
So when did you first start thinking about maybe I should try to do something in education? Was there a certain problem that you really ran into where you were like, "I got to do something about this?"
Niels Hoven:
I mentioned that I had a really good public school education, so I had the opportunity to do some independent study just during math class for an hour a day starting in third grade. And then I would rejoin my class for the rest of the day. And that allowed me to go really fast in math and rejoined... I think I hit my mic again. So that allowed me to go. So I had the opportunity to do independent study in starting in third grade just for an hour a day. So I would do independent study during math class and then rejoin my class mates for the rest of the day. And I did that from third through sixth grade. And then I rejoined a group math class in seventh grade for pre-calculus and calculus in eighth grade. And even beyond that, I was well-supported in the public school system for all the stuff that I wanted to learn as fast as I wanted to learn it.
I felt like I was challenged with interesting stuff all the way. And then over the years, I've just seen all the programs that I benefited from get cut, get deprioritized, or just straight up banned and gotten rid of because they don't believe that kids should have the opportunity to be learning as fast as I did. And I have a real problem with that. So ever since my kids were little, it's always been in the back of my head, how can I make sure that my kids will have the same opportunity to be as challenged as I was in school to the learn fast, have the learning needs supported, because I've seen the legislation get passed year after year that has been this slow decline and focus on lowering the bar. And so I've always wanted to do something about it, but I didn't actually know. I would say I saw what the problem was, but I didn't know how to solve it until during the Covid pandemic, when I needed to start teaching my own kids 'cause there was no educational opportunities and there's no school available to them.
And because I had a job at the time, my wife had a job at the time, we were both working full-time, I didn't have time to become a full-time teacher. I needed my kids to be able to teach themselves even at age three or four or however old they were. And so we started looking around for educational software products, like actual quality educational software products, and there wasn't very good stuff. There was some stuff that was okay. And so I gave it to the kids and with some support for me, they were able to make progress and do a lot of learning on their own.
And as I started to think about that more, from there I started talking to other parents who were interested in doing the same things with their kids that I had done with mine. And so I started giving them some advice and trying to set other kids on the same path. And that had challenges. But I'd say through that process was when I started to say, "Oh, this is interesting. It's not working right now, but with the right software, this might actually start working. And this model of independent study is really a solution that could work at scale to schools that have decided not to support our kids' learning needs."
Turner Novak:
And it's "independent study", but it's also like playing a game. If you use them on top of product, it just feels like you're playing. To a kid it'll just be like, "Oh, this is pretty fun."
Niels Hoven:
Yeah. I think one of our beliefs is that we don't need to do that much innovation on curriculum. The real problem to be solved here is motivation.
Turner Novak:
When you started actually building things, it was kind of hacked together, not very polished at all, right? It was very simple, like no-code stuff?
Niels Hoven:
Right. So when I guess I would say to be fair, we didn't hack it. We just didn't have anything. So with my kids, we started with just off the shelf software. So there's this piece of reading software that has since been Sunset called Head Sprout, which was kind of, I would say, the early prototype of what we wanted to build. It was a phonics based, very gamified learning experience, and it had a lot of problems, but it was effective. And my two oldest kids learned to read using that software. And then I talked to other parents who were interested, who were seeing my kids learn to read at age three and age two, and they said, "How do I get my kids to do that?" And they said, "Oh, well just use this software." And it turned out the software was not that good. There were a lot of problems within the other parents weren't able to make it work.
And so I said, "Okay, I'll do some phone calls with you. We'll still use the same software, but I'll give you some coaching over the phone." And we had some successes with that. But what I really saw with that, that was when I started to think, okay, the software is not good enough. We have to build something better, but there is an opportunity here and it can scale. And I think I had a certain number of questions that I wanted to check off before I kicked off the company. I guess one philosophy I have about building product is that you always want to be decreasing the amount of risk. So if you want to be successful, figure out where are the risks, where are the threats, and how do you decrease that risk? How do you eliminate them? And so when I thought about, okay, what are the possible mistaken assumptions that I could have about the world that wouldn't cause this company to be unsuccessful?
And I said, okay, so I've seen my kids learn from software on their own, so I know this is possible at least for my kids. So one other question is, okay, well maybe my kids are weirdos. Maybe other kids can't do this also. But then working with other parents we had a lot of failures, but we did have some successes where we saw, okay, there are some kids who are able to learn from just software. It's not just my kids. Then another question was, "Well, are my kids unusually smart? Will other kids not be able to learn at the same pace?" And what I saw from the pilot programs that we were doing was, oh, actually there are kids out there who are way smarter than my kids and are going way faster. I don't know how many of them, I don't know the percentage of the population, but certainly they exist.
My kids are not that weird. There's a lot of kids who could be learning at even younger ages, so that was checked off. And then another question was like, "Well, am I adding some sort of secret sauce? Do I need to be there sitting with the kids? Should I teach them how to make the software work?" And that's another thing that we essentially checked off like, no, actually I can coach parents remotely or I can give them instructions. I am able to set up situations where other kids who are not my kids are able to do what my kids did at an even faster pace with less support. And that's when I said, okay, then with better software, this can become a more widespread solution.
Turner Novak:
And then when you talk about this secret sauce of teaching kids, is there anything interesting that you've come across in terms of the most effective way to teach kids a Mentava related or anything really?
Niels Hoven:
There's a few different things. So one is that I think there's a tremendous amount of best practices that translate from gaming over to education. And I'm not talking about just about motivation. I'm talking about actual pedagogy in teaching. Because if you think about a new player coming into a game, you have to teach them. You have to teach them, this is the world, this is the way the world works, these are the rules, these are the actions you take, these are all the different skills. So we have a switch. So my kids just started playing Breath of the Wild. And if you think about all of the different things you have to learn in Breath of the Wild to be successful, it's like how to do combat, how to fight, how to dodge, how to parry, how to crap, how to forge. There's so much stuff and all that stuff has to be taught by the game.
Turner Novak:
Usually there's like a walkthrough tutorial type thing just on the screen guiding you through it when you play these games, right?
Niels Hoven:
There's a walkthrough tutorial, but those tutorials still run into the same question of how do you actually get people to retain this information? So when I was designing game tutorials, one belief I had is basically anytime you have to put an arrow on the screen, you have failed. Because it is possible to essentially tap through a tutorial just by following all the arrows, and then you've completed the task, but you can't do it again on your own. All you did was follow the arrows. So the goal isn't a positive outcome. The goal is actually understanding. You have to get the fundamental understanding into the player's head. You have to actually be teaching something. And so there's this whole essentially pedagogy, curriculum design in games of how do I teach people why they want to do this and how to do it and how to apply it in the right situations.
And a lot of that translates over into education, especially when we're building in software. And it has a lot to do with creating motivation, designing incentives so that people want to accomplish this goal. Very tight feedback loops so that people can't go too far off the beaten path. They get corrected right away and come back onto the right path. So a lot of the work that we've done is focused on how do you tighten up feedback loops and give kids the appropriate feedback they need as quickly as possible and always be incentivizing and rewarding the behavior that you want to be teaching.
Turner Novak:
Fascinating. Yeah. I'm thinking through just using the products with my kids just in, well, my one daughter that uses it, just how does that flow through in the Mentava product? Any examples that people could learn from?
Niels Hoven:
So if you look at a typical, say, edutainment product, know ABC Mouse or even Khan Academy Kids or something like that, the behavior that's rewarded there is mostly engagement. It's like, how do we keep the kid just continuing to interact with. There's like anything you touch on the screen lights up and sparkles, and so what behavior are you rewarding? You're rewarding just staying there, passive consumption of what is on the screen.
The behavior that we want to reward in Mentava is cognitively demanding thinking and engagement. So if we ever have an activity that kids can sort of cap through mindlessly, they will do that. And so as much as we can, if we want to make it impossible... We don't want to reward that behavior. We want to reward the behavior of, I want to think about, I want to think really hard about this and try and get the right answer.
So, one rule of thumb we have is that getting the wrong answer cannot be fun. And that doesn't mean that we're like Family feud, big red X, this is wrong, because that is actually fun. So it's actually fun to get the wrong answer over and over again, and then we've incentivized the wrong thing. And so actually when you do the wrong thing in Mentava, it's just flat. It's just like nothing happened. So it's like, "Oh, I am not rewarded for this at all. This is not fun." The fun thing is to think really hard and get the correct answer.
Turner Novak:
Yeah, that does make sense. In terms of, I know we want to talk a little bit about fundraising. You had a little bit of a different take on it. You have a bunch of smaller angels, you have a couple maybe institutional checks, but yeah, I think you're very adamant of party round to raise so much for people. I think it works with your product too. Probably a lot of parents on the cap table. How did you approach fundraising and when did that all come about?
Niels Hoven:
One of the beliefs that I had when I started fundraising... So, I was a solo founder. I would classify myself as non-technical. I was a software engineer. I wrote code in a previous life, but not for a very long time. It would be difficult for me to sit down and build something productively right now. So I would say I was a solo non-technical founder, and so I knew going out that I would have to go out and hire essentially my entire team. And one of the big gaps that I felt like I had was credibility. This is the classic thing where you're like, "I'm a non-technical founder, but I have this great idea. And all I need is somebody to code it for me." That was the situation that I was in.
Turner Novak:
Yeah, crazy idea. We're going to teach basically toddlers how to read. People are like, "All right, this guy is crazy."
Niels Hoven:
Yeah. So I was like, "I have this idea I'm going to teach two-year olds how to read. And all I need is an engineer to put it together for me 'cause I've got the idea." So, this is the worst stereotype of your non-technical founder ever. And so I knew that if I was going to go out there and I needed to hire a team or sell a product or whatever, I needed some credibility. And I think the easiest way to build some credibility with an angel round is essentially brands, and brands of VCs, brands of angel investors.
And so that's when I thought early on, "Okay, I want to make this a party round. I want to make this a party round with this many big names as I can possibly get into it." And not only that, because if I can get a bunch of big names, they also come with audiences, they come with platforms, and maybe they come with kids. They certainly come with friends who have kids. And so in some sense, this party round was not just buying credibility, it was almost like user acquisition. It was buying access to circles of people who would hopefully be the earliest adopters of our product.
Turner Novak:
Yeah, I remember when I met you, I was like, "Oh, this sounds great. Sounds not true, but I mean a while, I'll hear what you have to say, because it sounds great if you can actually do it."
Niels Hoven:
Yeah. It's almost, it's like red meats for VCs where you're like, "Your child is not being supported in schools." And they're like, "They're not." "Your child could be doing more." "Yes they could." "And I have a product that will fix that." They're like, "Okay, where do I write the check?"
Turner Novak:
Yeah.
Niels Hoven:
So, it was actually an interesting fundraising because I noticed a really big difference between trying to raise from VCs versus trying to raise from angels. And it was almost like most VCs, I would say were looking for a reason to say no. And most angels were looking for a reason to say, yeah. I talked to a lot of VCs who are like, "Well, we'd like you, but there's just so much risk. You don't have a team, you don't have a product. We're not sure if you're going to be able to build this." I'm like, "Yeah, all of that is true. I can't argue with any of that."
Turner Novak:
That is classic, just pre-seed risk though. I mean, you didn't have a product built yet. That is the risk that's out there. So it's like, no shit, that's what they think, 'cause of course, it's not built yet.
Niels Hoven:
Yeah, that's fair. But they'd also be like, "Oh, but you don't even have a co-founder, you don't have a team, you don't have anyone technical." Well, yeah. But like you said, that is the risk. And I think Quiet and Floodgate where there were the two exceptions that were just, "No, we believe in you so much, you have such clear vision that we want to fund this now. We see where you're going with it." And so, I'm eternally grateful for them.
And then of course, all the angels we had, you, Tim Ferriss, Garry Tan, Eric Ries, everyone who just immediately saw the vision and bought into the mission. They were like, "I just want to be part of this and introduce this." And it was slow-going early on, because my pitching was so bad. Actually, I wrote a blog post about this that I think has been shared around a decent amount about-
Turner Novak:
Yeah, I haven't seen that.
Niels Hoven:
... how I recruited 50 top tier angel investors for Mentava's seed round or something like that.
Turner Novak:
Oh, actually, nevermind. I actually have seen that. We'll throw it in the show notes for people to read if they want to check it out.
Niels Hoven:
Nice. Yeah, it's got some spicy quotes from our first investors who I showed a recording of my pitch and they're like, "This is terrible. You look angry."
Turner Novak:
Oh, no.
Niels Hoven:
It really was just really bad.
Turner Novak:
So, what was wrong with the pitch?
Niels Hoven:
It was me. I was what was wrong with the pitch. Just like the way I came off, 'cause I was doing all of this over camera for COVID. And the way I was coming off was I was not passionate. It was angry and weird and disconnected. And I just needed to practice and get better at pitching and being more personable and telling a better story and being less confusing. I got a fair amount of no's doing that.
I started with basically the investors who, I don't want to say C tier, but I'll say C tier. The investors who I cared the least about who, if they gave me a no, I would feel less bad about. And then once I felt like I was closing them consistently, then I said, "Okay, give me some introductions to your higher status connections." And worked my way up that list until felt like I essentially maxed out the credibility that I was able to close.
Turner Novak:
Yeah, I think you have an interesting quote just in terms of how you think about positioning yourself for fundraising. It's basically, "Be so good that investors feel like they're doing a favor to the person that you're getting introduced to." That's a good way to think about fundraising. I mean, if you get to that point, that's like the holy grail.
Niels Hoven:
Yeah, it's very much this tipping point where if investors are like, "This company's not that great, but I'll introduce them to my friend and maybe they'll close.", you're going to be pushing this boulder up the hill the entire way. Whereas once you cross that tipping point where they're like, "Oh, this is a hot company. I want in and everybody else wants in. My friends don't know about this yet, so I actually gained social status by telling my friends about it." That's when the momentum really starts to build.
And when we crossed that tipping point, it was not because the business idea changed, it was because my ability to explain our business improved. And so generally, you have this foundation of you have to have a good idea, you have to have unit economics that work, you have to have a viable idea. But then you also need to be able to explain it. And so for me personally, the idea was always there. And then when I got to the point that I was able to explain it and sell it well, that was when we really built the momentum and then closed our round pretty fast.
Turner Novak:
Yeah. And then I remember too, you took a couple more really small angel checks around the momentum of the early launch. And I remember too, that's why I was like, "Oh sure. Whoever you want to meet, I'm happy to connect you with the people I know 'cause you look like a great investment. People probably want to meet you. You've created all this momentum for a product that most people don't think should or could exist, but it does."
Niels Hoven:
So, we took advantage. So right now we're in this situation, where we're not really cash strapped, we're not profitable yet, but we're not burning too much. So, we're okay. But there was this position to, I guess, essentially build our credibility even more. So when we got that big boost from that launch, it was like, "Okay, what other names can we get on our cap table that would either bring us connections to networks that we want to access or build us more credibility?" And so I think in that round, we just brought in Matt Mullenweg, Daniel Strachman who was formerly of the Theil Foundation that runs 1517 Fund, Annie Duke. And just a bunch of people that I'm really happy to have supporting us, their networks, and help give us credibility as we're making these wildly outrageous claims.
Turner Novak:
Yep. So you have your wildly outrageous claim, you've got money in the bank, you need to build a business. So, just how do you think about, what do you charge for this kind of thing? You hinted before $500 deposit, a little bit of a premium product. But how do you think about the business model, what you charge people, all that kind of stuff?
Niels Hoven:
I have a belief that when it comes to education, a big part of the reason that we don't see better educational software out there is just because the people haven't found the right business model yet.
Turner Novak:
So, what's the traditional ed tech business model?
Niels Hoven:
So the traditional ed tech business model is one, you just sell to schools on. The other one is sell to parents. Both of them have this essentially mass market implication. And I think when you try to sell educational products mass market, there is an implicit assumption I think is false, that the mass market is interested in education. And that's just not true. And so, you see this over and over again with these patterns that, not just with kids, with adults, that when you put an educational product out in the market, in order to become more successful, it is pushed to become the edutainment.
You see this in Master Class where the founders talk about their vision of making world-class experts available to teach everybody, and really what it turned into was celebrity edutainment. You see it with the mass market kids educational products that have been really successful like ABC Mouse, and even to some extent Khan Academy Kids. That the value proposition that sells to the mass market is not really hardcore education or academic academic rigor, it is babysitting without guilt.
Turner Novak:
Yeah, I was going to say the core product of a lot of education products, but even the school system, childcare, it kind of is a part of all of it. It's kind of like a... I actually think it's great. I do think that is... A family, a household needs to earn income, and it's hard to do that if you're watching kids all day. So, you need a way to solve for that. So, it's part of the problem you have to solve for.
Niels Hoven:
All of our school's struggles, they have an 80% approval rating among parents.
Turner Novak:
That's insane. After everything we just talked about, you'd think it was like zero, but it's actually, yeah. Our kid's school is great. We love them.
Niels Hoven:
Yeah. And I think that is because for a lot of parents, fundamentally, the primary job that this school does is childcare. And for a lot of parents, free childcare every day in a place where your children are cared for and loved and can learn something while they're there, is a pretty great deal. Without schools, that would be really expensive. And so in some sense, I have a belief that the audience that we are selling to, the parents are like, "My kid is not being well-supported. My kid is capable of more, they have higher potential. They're not being supported." That is a niche market, the optimizing education. I want more academic rigor is not the mass market.
Turner Novak:
Well, it's almost like you say it's a niche market, but they also probably have the propensity to pay. Is that true? When I just look at, I know in China for example, education is a big market. A lot of countries in Asia where kids will go to school, but then they'll do a couple of hours, 6, 7, 8 hours of extra tutoring services all around it. And those markets are insane. People will pay a lot of money for those things. And it's actually maybe in some countries it's not just a niche, it's actually pretty broad. But is that also, it's actually a pretty big market, isn't it?
Niels Hoven:
Yeah. I think if you do it on sort of a revenue scale, I think there's a small segment of the population, particularly in the U.S., there's a small segment of the population who really care about optimizing education. But that segment really understands how valuable education can be. And so if you have a product that is really, really good or really impactful, then they're willing to pay for it. And so you see those dynamics in colleges, for example.
I have a big problem with college admissions and how our colleges work and all that college credentialing, et cetera. But at the end of the day, you do have a very small number of elite colleges that costs a hundred thousand dollars a year. And then you have a large number of essentially mass market colleges that do not give you the elite credential, but they would give you something else for a whole lot less money. And so, my belief is that you have to match your business model to the realities of the market. And I believe that the market for optimized education is a niche market. And the only way to succeed in niche market is to have a high-priced product. And so, that's why we cost $500 a month.
Turner Novak:
And if you think about, what is it doing, it's a private tutor essentially. Those are pretty expensive also. How does it compare and price?
Niels Hoven:
So if you were going to send your kid to private school, that would be probably 2,000, $2,500 a month. If you wanted to get a private tutor to come in and teach your kid every day, which some of our customers did have, that's going to be close to $1,500 a month. And those customers told us, "Oh, we were able to get rid of our $1,500 a month tutor to use your software, which only costs 500 a month." They're like, "You should be charging more 'cause you are better, you are more convenient, and you're more effective than this thing we're paying $1,500 a month for."
So I think ultimately, we believe all kids deserve to have their learning needs supported. We want to create this opportunity for everybody. And so, what is the reality of the market that will allow you to deliver access to this product to a whole bunch of people who could probably benefit from it but are not willing to pay for it? And I think in order to make that work, you have to find this sort of barbell model where you charge some people who value it a whole lot of money. And then use that to subsidize some kind of access to the software for everybody else who could benefit from it but aren't willing to pay for it. It's almost like the Toms or Warby Parker model. And so we have a vision of where we're going in that direction, but it's going to take us a little while to get there.
Turner Novak:
Yeah. There was a question from Shil Monah, one of our mutual friends. I think he actually connected us back three, four years ago. So, you don't think this is just a product for I guess "rich people." You do think that you can build something that's mass market?
Niels Hoven:
Approaching the business model with this barbell mentality is a more effective way to create a product that can be distributed extremely broadly than say just selling a product for a really low price point for like $5 or something like that.
Turner Novak:
So, what does this mean? You hit on this barbell model. You're hinting that it's there. Are you talking publicly much about what that is?
Niels Hoven:
I think we have a vision of where we can essentially have a version of our product that we can sell at a really high price point to the people who most deeply value the educational benefits that we can offer. And that we can use that to subsidize access to high quality educational software for a much, much larger audience who would never be able or willing to pay for our product. I think that's the direction we want to move towards, but it's going to take a fair amount of building before I think we have the product suite to realize that.
Turner Novak:
Interesting. I guess another way to think about it, if you flip it, you make a mass market product that's almost lead gen for premium, higher priced.
Niels Hoven:
Yeah. I guess in that sense, you could say we've already done some of that. So, we have our Alphabet Sounds book that is available for free on our website, or as cheap as we can sell it on Amazon. We sell it at cost on Amazon, so we make no profit off of this. And it is just a book aimed at kids probably like 12 months to 36 months who are learning the sound of the English language. And it's focused on, most alphabet books today teach wrong because they're focused on the letters. They're focused on the 26 letters of the English alphabet, and they'll be like, "X is for xylophone.", or something like that.
Turner Novak:
Yep. That's a canonical example for X.
Niels Hoven:
Yeah, and X doesn't make the “eck’s” sound, X makes the “cks” sound like in box or fox. And so they focus on teaching the 26 letters of the alphabet, but there's actually 44 sounds in English, and most of them are represented by more than one letter. And so actually, what you want for a pre-reader who is not actually learning written letters yet, you need a book that is going to teach them the sounds.
So we have an alphabet sounds book that we essentially distribute for free or at cost, just because we think it's the right thing to put out there. We want to get in as many kids' hands as possible. And so simultaneously, hopefully we can make an impact on a large number of kids' reading ability through this product. But also, like you said, it becomes lead gen and helps build credibility for our brand.
Turner Novak:
Interesting. Well, we'll throw a link to those or to that also in the show notes, the Amazon one and also the website one, if people want to check them out.
What have been some of the early customer success stories? I mean, you've mentioned a couple of times that people are using it, people are excited about it. What are some examples you're allowed to share?
Niels Hoven:
So we've just started doing some case studies, so it's just been really fun talking to our customers 'cause we just get some amazing quotes. I told you one already about the customer who had been paying $1,500 for their human tutor, and they're like, "Now that tutor's gone because Mentava's better and it's a third of the price." So, several customers have told us that Mentava is more effective than the in-tutor, the in-person tutor they were paying for.
Someone else told us the other that, "Humans can't teach the way Mentava does.", which I thought was a great quote. We talked to a family whose kid had been struggling in kindergarten. So they were saying, oh, they were very stressed out because they looked at... they'd been trying to teach their kids some basic phonics, some basic reading, and it just wasn't sticking. He wasn't making progress. He was behind all of his peers in their peer group. He had started in kindergarten and he tested really low on whatever the fundamental coming into kindergarten skills were supposed to be.
And his teacher's like, "Yeah, he's really far behind." And then they got their hands on Mentava and now I think they said the teacher said that they have never seen anybody catch up in the period of three months and exceed expectations the way that this kid had. And so they're like, some said, "You guys changed our lives. There's not a world where I'd take a kid and teach them to read any other way." It's been really cool getting these customers' stories.
Turner Novak:
One thing I've always been curious about, especially with just education, kid-related software in general, how do you feel about this sort of screen time dilemma? I think kids need to learn how to use technology, but also is there a certain point where it's like, "Hey, eight hours a day of TV or iPad is probably objectively not a good thing." How do you think about this as a founder in the space building products, but also as a parent?
Niels Hoven:
Yeah, I think this is a great question because I'm actually pretty anti-screens, which people are often surprised to hear. We don't even have a TV in our house.
Turner Novak:
Whoa, okay. Yeah, that's pretty extreme.
Niels Hoven:
So I come from mobile games, so I have seen how addictive screen experiences can be, like how deeply we think about in making those experiences addictive as possible. And so, I have a really fundamental belief that screens are drug delivery devices. And so, there are apps that are FDA regulated that are prescription only. So even the FDA recognizes they like, "No, this is a drug delivery device. And we can build drugs that deliver it through this screen. And we need to regulate them."
Turner Novak:
Wait, what are some of these drug delivery FDA approved apps?
Niels Hoven:
A lot of them have to do with therapy or cognitive behavioral therapy and things like that.
Turner Novak:
Those are generally of a positive spin, like, "Hey, we'll help you with depression or some sort of brain related or a brain body connection type thing."
Niels Hoven:
Exactly. Exactly. So, there are good drugs and there are bad drugs. And the FDA recognizes that and they're saying, "Okay, this is a good drug, but we're going to have to regulate it. It's going to be prescription only." But then you have the whole App Store market, and so what happens when you have a drug delivery device in a market that is completely unregulated? What are the drugs that are going to be most successful? It's basically addictive brain, junk food, baby heroin, Cocoa Melon. That's what fills the App Store. So, I totally understand where parents are coming from, where they're like, "Oh, screens are junk." Because 99.9% of the stuff the drugs available through those screens are junk.
Turner Novak:
Yeah. I think before I had kids, when you talk about being in the restaurant, you'd see the parents with their kids. I would see a kid on a screen in a restaurant, I'd be like, "Oh, I'm never going to do that. I'm never going to give screens to my kids." Spoiler for anyone who's not there yet, it completely changes. Once you have kids, you're like, "Okay, some element of this is actually... It's kind of nice."
Niels Hoven:
Yeah. I would say we're way more strict about this than most of our friends. But still when we get on a plane, it's like, "Here's your heroin on a screen. I will see you in eight hours." But to me, the big difference is between passive consumption versus active learning. And passive consumption is like the Cocoa Melon, YouTube, ABC Mouse, whatever, where you give it to the kid and they become a screen zombie for as long as you will allow them. Versus active learning is what Mentava is, where it's actually self-limiting. It's almost like doing squat, you can only work out for so long. Your brain gets tired. And so what we see is kids are done after 15 or 20 minutes, because you can't think about it anymore. It's too hard, it's self-limiting. And that's what we want. Mentava is like 15 to 30 minutes a day and we'll get your kid reading in six months.
Turner Novak:
And I do think we're in the year 2024, these kids that are 2, 3, 4, 5, 6 years old, they're going to be maturing and growing. And they're becoming an adult and it's 2040 or whatever. If they do not know how to use technology, they are going to be at an extreme disadvantage in life. I don't think it is a good idea to just say no screens or no technology at all.
I think it needs to be done in a way that's responsible, and to your point, guiding them through the potentially addictive and detrimental downsides of it. But also it's like, hey, I feel like I had such an advantage just in life of knowing how to use Google or just understanding how to use software, learning how to code in middle school. It definitely sets you up.
Niels Hoven:
Right. I mean, we know this when it comes to something like food, right? There's good food and there's bad, there's junk food and there's healthy food. And we don't say, "Oh, kids don't eat anything." We understand that our responsibility is to teach them to understand what is healthy food and what is junk food. And when is it okay to have junk food and how to have junk food in a recreational or responsible... What does recreational screen drug use look like? Your kids need to understand that from an early age.
Turner Novak:
Do you have four kids?
Niels Hoven:
I have four kids, yeah.
Turner Novak:
What are your top parenting hacks? Are there anything where people ask you for advice or things that made your life easier as a parent? What's kind of your top couple of things you usually share with people?
Niels Hoven:
So, I guess I just had a post that went viral a little while ago where I said, "When you have your newborn baby and you bring them home from the hospital and you put them down to sleep, and where they're sleeping, put a movie on in the background, something with a lot of talking or a lot of explosions or something. 'Cause you want to get them used to sleeping through noise. And don't train your baby that it's always going to be dead silent when they're sleeping, or else you're going to have to keep it dead silent all the time.
I'm working on an article right now about the best way to bribe kids. And I think bribing is an intentionally, I'd say, triggering word. But thirdly, understanding how to use reward systems to motivate the sort of behavior that you want. When my oldest kid was, I know maybe three or four, something like that, we went to a family Thanksgiving. And he was having a lot of trouble with shyness. He would hide behind our legs, so just like a big family gathering. He would hide behind our legs and refuse to say hi to people. And it was kind of embarrassing and it was hard for him.
And so we said, "Look." We stopped at a 7-Eleven on the way back, and I bought a little tube of M&M Minis, like those tiny, tiny little M&Ms. I was like, "Look, every time you say hi to someone, I'm going to give you one of these M&M Minis." And the next party we're at, he was like, "Hi, hi, hi, hi, hi, hi." We'd be like, "That's too easy. Now you have to say hi and introduce yourself." And so, we started doing that. And our family was like, "Your son is so friendly and outgoing." We were like, "Yeah, just our little extrovert. That's him."
Turner Novak:
Well, it's all about incentives. Everything in life, it's like, what do you get rewarded for? And people will do that behavior. It's so simple, but it's so powerful.
Niels Hoven:
I mean, people hate it when I say that the parenting is a lot like dog training, but it really is. Rewards and rewards and corrections. And it doesn't... Not huge. It doesn't take much. Your correction doesn't have to be something catastrophic. It can just be letting your child know that the behavior is unacceptable and your reward can be something as small as an M&M Mini. But certainly setting those boundaries and helping kids understand that there are consequences to their actions and good things lead to good consequences and bad things lead to bad consequences, is really, really powerful.
Turner Novak:
Yeah, that's one of the things I think we've, I guess figured... I don't want to say we're perfect at it, but just the way you kind of reward the kids and that kind of behavior, but also how you do it specifically. I think another thing too, that I've really found works is not overreacting. So when something happens to one of your kids, you kind of see what they do before you do anything. And then a lot of the times too when... I'll usually ask them a lot of questions. Like, "How did that make you feel?" Or, "How does this make you feel?"
Because you might realize that they're not even worried about this thing. And they actually think it's a good thing or something. So you just go a little bit slower with the "parenting," quote-unquote. And maybe this is a theme of this whole conversation, but kids are so much smarter and more resilient than you would think.
Niels Hoven:
I think the classic example here is you watch your toddlers when they fall down. They fall down and then there's this moment where they get up and look at you, and they're trying to figure out how upset they should be about falling down. And you'll see in the families with the really anxious parents who rush over them and pick them up, and then the kids start to learn that, "Oh, this falling down was a really bad thing. This is really traumatic. I better turn to my parent for some comfort." Versus the kids who just learned like, "Oh, this is not a big deal. I can just get up and keep right on going." That behavior gets learned and trained pretty early.
Turner Novak:
Yeah, I think an interesting thing, I don't think this is really a hot topic anymore. This is kind of well-known at this point. But you really want to praise the behavior, that it's around effort and just putting in the work of trying to do something versus an outcome being good or bad. So it's like to the point of reading, it's like you're just praising that they're even trying to do it, not necessarily if they got it right or wrong. But just like, "Hey, I love that you're reading," or, "I love how much you enjoy doing art." It's not like, "Is it good or bad?" It's just like, "I love how into it you get."
Niels Hoven:
A big theme with the brides in our house is that you get rewarded for doing hard things, but once it becomes easy for you, then that fades out and you have to find a new hard thing to work on.
Turner Novak:
I guess, yeah, it's all about incentives. I think you have this really interesting take around doing analytics and product design. Can you just explain how you approach that and what you think about it?
Niels Hoven:
So as a builder, I think that a lot of your responsibility in building is about taste. And this goes for product owners, product managers, engineers, whatever. Whatever you're building, you are trying to make it wonderful for your customers. And so that implies a certain level of ownership and accountability for understanding your customers and making good decisions on their behalf. And I think the problem with the way that a lot of people use quantitative analytics and data is that they're trying to essentially absolve themselves of that responsibility. They want to step away from that accountability. And they want to say like, "Oh, it's not my decision. We're just going to do what the data says."
And there so many problems with that though. You end up with Frankenstein products that are just like a hodgepodge of all these different directions with no clear product vision. And they over-optimize for short-term metrics that are really easy to measure at the expense of long-term metrics like retention and customer satisfaction and brand value. You sacrifice those to move the short-term metrics that you can measure, even though the long-term metrics are the ones that you actually care about. There's a period where you saw this in games for a long time, especially in mobile games.
Turner Novak:
Any examples?
Niels Hoven:
I'd say Zynga would definitely, in this trap for a long time. There was, I would say, a dark period in mobile gaming, I'd say right before Supercell came out. Where there were a lot of games that were just very data-driven without a clear product vision, that was just like, we'll just put in whatever there is to make the game stickier and make the metrics better. And it kind of worked. But then I'd say that Supercell with Hay Day and Clash of Clans really came out with... Showed the power of what can happen when you really have a game with a very cohesive product vision that was just unified around that particular direction.
I think they've said publicly how they really trust more and much more qualitative feedback from their customers about what is fun and what is joyful in order to drive their product decision. And so since then you've seen the success of games that have much stronger, clearer product vision. Like Minecraft was not built by iterating on quantitative metrics. It was built by someone with a strong vision. Same with Fortnite, and so on.
Turner Novak:
Interesting. Yeah, it feels like there's a lot of lessons from gaming here. Not just in vision of the product, but also in terms of earlier, like motivations. How do you encourage people to do certain things?
Niels Hoven:
Yeah, I think of gaming as almost like the most hardcore proving grounds for building product. If you learn how to build product in games, you can build anything. And part of the challenge for that is that in the real world, when you're building a product for a customer, most of the time they have a problem that you're trying to solve. And so if you can build a product that solves that problem, then you will be successful.
Gaming is harder because that problem doesn't exist. So you have to simultaneously create the problem and then make it feel so compelling to the player that they think, "Oh, I never knew that I wanted a virtual farm in my pocket, but now I do, and I realize that, and I want it so badly that I'm willing to pay in order to have my farm become more successful." And so you're almost working both ends of the problem. And it's really, really difficult to do well. And I think that part of the reason why you see so few games become so incredibly successful.
Turner Novak:
Interesting. So what are you mostly solving for in gaming? Is it boredom, typically? Just like, "I don't know how to spend my time and I'm just looking for something to do"?
Niels Hoven:
I would say that the thing that really makes gaming compelling is that in the real world, the feedback loops around the actions that you take, like your success/failure are very weird and abstract and not always essentially correct. Versus in gaming, you get these very clear feedback loops of like, if I learn the right thing and I do the right thing, then I'm positively rewarded. And it's just such a more satisfying connection between the effort that you put in and the reward that comes out of it. And I think people are looking for that sort of fulfillment and they find it in games.
Turner Novak:
I have a couple other questions. One thing you have, throughout your career, done this one-question Google survey that you send to people. Can you explain what exactly that is, what the question is, and why you do it?
Niels Hoven:
Oh, man. I don't know where you dug this up from, but yeah. So I have known for a very long time. So I'm in my mid-40s now and I dropped out of grad school in my mid-20s, so this is over two decades. I've known for a long time that I wanted to start something and I've tried for a few times before Mentava, and was unsuccessful. I always felt like I just didn't have the right idea. I didn't find the right problem that I wanted to solve.
And so Google used to have these surveys that you could run that cost... If it was a one-question survey, I think it cost 10 cents for that one question. If you wanted to do two questions, it was something like a $1 per question. But if it was only a one-question survey, it would be 10 cents for that question. So I ran thousands of these one question surveys. Well, it was the same one question, but I ran it to thousands and thousands of people.
And the question was basically just, what's the biggest problem in your current job? And so I would just have, for years, I would have this survey running in the background, trying to find an interesting problem to work on. And got thousands of responses and I think found a few interesting ideas. I guess there are a few big learnings that I got from that. One is that most people do not think about that. They don't think about, "Oh, what is the problem in my job that I wish that this could be solved?"
Turner Novak:
They're probably trying to forget about the problems. They skip over them or they don't really dwell on them.
Niels Hoven:
Yeah. For the most part, it's just like, "I don't like my boss," or "My boss is not telling me to do the right things." No one is thinking about, "Oh, my current job, this thing could be so much more efficient if we just did it the right way." But there were a few people who did think about that. And they would say things like, I don't know, "I run a construction crew and I have all these construction workers that need to clock in and clock out at specific times. It would be really nice if, instead of having a physical time clock, they could just do that on their phone."
And I would read things like that and be like, oh, actually that does sound like a really good idea. And then I would look it up and be like, oh, that totally exists. So they see the problem, they wish the solution exists, but take the next step and actually let me go out and search for it and implement it. It doesn't happen either.
Turner Novak:
So then did Mentava come in through that survey?
Niels Hoven:
So Mentava did not come into the radar. It just came in through the classic example of, I have this problem. I bet other people have this problem too. Let me solve this problem for myself and fix it for other people at the same time.
Turner Novak:
Interesting. Okay. Well, so then with Mentava, what is the end state or the future of all of this? If we're fast-forwarding 10 years, 20 years, 30 years, I don't know how far in the future we need to go, but how do you think about the end state of everything that you're doing?
Niels Hoven:
Yeah, I guess in some sense I'm trying to recapture the public school experience that I had where I was supported in learning as fast as I wanted even in my local public school. So when I was in third grade, I started doing independent study in math class. I think I mentioned this. And so just during that hour I would study math, whatever I wanted at my own pace, and that's how I ended up doing a bunch of years of math in about four years. And that's kind of the vision. To have kids be part of their local public school community, to go to school with peers their own age and still have the opportunity to learn and progress as fast as they want.
Turner Novak:
And then so I think one sort of this discourse around the future of education, AI has kind of... It's made some interesting things possible. Is AI a big piece of education in the future?
Niels Hoven:
I think it will become an increasingly large piece. I think people are starting to recognize the potential that AI has as essentially a tutor. And when we raised money for Mentava, the idea that students could be learning from software, I would say was sort of a contrarian hypothesis where people were like, "Oh, how can you have software that would replace a human?" And then AI came out and like a year later people were like, "Oh, of course, I've always believed that software would replace teachers." So now we're very mainstream.
So maybe I'll be the contrarian and say, I actually don't think it's going to be that impactful for the reasons I said before, which is that, for most families, school is more about daycare than optimizing learning. And actually, for most families, that one-size-fits-all model actually does pretty well for those kids who are in the median, in the average. So it's really the kids who are most deeply underserved are the kids who are really struggling and the kids who want to be learning a whole lot faster. And that's where I think maybe some more personalized education from a software instructor possibly driven by AI could be really powerful.
Turner Novak:
I think another really unexplored area, we haven't really mentioned it much about education, is just the social aspect. Both of my daughters, I would just say, they're incredible friends. They love their friends that they've met at school and they just love the empathy and relating to other people. And if you wake up and you have this AI thing and you just sit in front of a computer all day and then you go to sleep, there's none of that personal connection that's there too. I feel like that is a big part of education also is just learning how to be a member of society and having relationships with people.
Niels Hoven:
I think one of the important things to understand about some of these software-enabled learning solutions is how fast kids can actually learn essentially when you're focused on using their time effectively. So if you look at most home schoolers, most home schoolers only spend a couple hours a day, like two hours a day doing actual academics. And then the whole rest of the day can be opened up for projects and socializing and games and sports or whatever you want to spend the day with. Once you've essentially gotten rid of this education theater where you have to pretend to be teaching to kids during daycare for these seven or eight hours of the day.
There's actually schools that are starting to do this now. I think the one that I find most interesting is Alpha School in Texas, which I think very much aligns with our model where the kids spend two hours in the morning doing focused, educational software for those two hours. And they're progressing at two to five times the pace that you would expect kids to in the standard curriculum. And then the rest of the day they just have to spend on whatever projects they want. So I think some kids are working on becoming YouTube influencers. Some kids are becoming e-gamers, some kids are raising money for their startups.
Turner Novak:
Whoa, that's crazy. Yeah.
Niels Hoven:
The rest of the day is just open for whatever, if you want to spend it socializing, playing games, playing sports, all of those are open to you because gotten your education out of the way in those two very focused hours at the beginning.
Turner Novak:
Yeah, I think kids do need space to just "be a kid," quote-unquote. When we were doing parent-teacher conferences a couple of weeks ago and you just see the schedule on the board. And it's science and then recess. And then math and then lunch. And then there's music class, and then there's another maybe hardcore learning block. And it's like recess again. To your point, it's like kids don't just go to school and learn or work or whatever for eight hours straight. There's a lot of other stuff weaved in there to like, maybe you can actually teach the kids a little bit better, you learn better because you get some mental time. You have some focus time, then you have a little bit of less intense strenuous mental activity.
Niels Hoven:
Yeah. I think my kids, their time outside of school, they're engaged in sports, they're doing soccer, or jujitsu, play dates with friends. One of the reasons I push so hard in independent study is because I don't want to be building a Kumon, where the kids go to their other school after school. School should be for school. You go do your learning in there and then you have the rest of the day to do the other stuff that you want to do. I think there were some investors who opted out of investing in us because they felt like this had the potential to create too much academic pressure on kids.
It was like, "Oh, now there's this new opportunity that just completely ungated to learn as fast as you want. Now everybody has to do that in order to have competitive college admissions." And I think that's fair. I think there is some risk of that. There are some reasons why I don't think that is the future that is going to come to pass. I try to encourage most of our parents to think about this as a marathon, not a sprint, and just have the confidence that under the current system, you basically crawl all the way up until ninth grade when you suddenly realize that you're way behind on all the things that you want to do for your college admissions. And then you're super stressed out trying to cram it into four years.
Whereas, if you just have the confidence that if you just spend your 12 years doing all of this thing at a fast-paced walk, that's very manageable, and you can still end up way far ahead of where everybody else is and demonstrating your own potential at a very healthy, comfortable way. And so that's my hope in how the tools that we're building will be used.
Turner Novak:
So is quote-unquote, "going to college," is that a good end state for an education or a goal of an attainment for the whole system? Or what's your thoughts on that?
Niels Hoven:
So there's a lot of evidence right now that the real value of... When we say colleges, I think especially in our circles, we're usually thinking about the elite colleges.
Turner Novak:
Like Harvard, Yale, whatever. Yeah, yeah.
Niels Hoven:
Right. And there's a lot of evidence that the real value of those is really in their credential.
Turner Novak:
The network that you build, the people that you meet. Yeah.
Niels Hoven:
Exactly. If it was really what you were learning there, then what you would expect is essentially someone gets accepted into Harvard. A high school graduate is essentially worth this much. And then after a year at Harvard, they're worth this much. And then after two years at Harvard, they're worth this much and so on. They're growing their human capital by the information that they're learning at this school each year an incremental amount. And you don't actually see that.
And so that's sort of the first sign that that human capital model of college is actually not correct. What you actually see is there's essentially a step function when you get accepted into Harvard. And there's this step function when you graduate. That's more of an indicator that actually what you're getting out of this is a credential. The credential says that, "Oh, you're good enough to be accepted to Harvard." And the next credential is that you're conscientious enough to make it through four years there and not rock the boat and graduate with a degree.
You don't get this dynamic in, say, sports. LeBron James did not have to go to college and get a credential there in order to be picked up by the employers, by the NBA. And I think the big difference there is because in sports you are allowed to demonstrate your potential even while you're still in high school. You're allowed to differentiate yourself and show how talented you are.
We have a K through 12 system that is trying to engineer these equal outcomes where no one is allowed to fully demonstrate their full potential. And so you just have colleges creeping in to arbitrage this game and be like, "Okay, we're going to make it... It's like the SATs. We're going to check their ACT scores or we're going to check their college grades. We will sift through all the cruft and find, okay, these are the kids that we want to credential and give the stamp and we'll pass them off to the employers. And oh, by the way, we're going to charge you a half million dollars for that credential."
So I think it is a space that is ripe for disruption. And I think companies like Mentava, that allow kids to better distinguish themselves before they need that college credential, have the potential to disrupt the college credential cartel. And so that is my hope. It's a pretty long shot but that's my hope.
Turner Novak:
What do you think happens to... Maybe it's an Ivy League education, maybe it's just broadly higher education over the next 10 or 20 years. Does the value of one of these degrees go up, go down, stay the same? What do you think?
Niels Hoven:
If no one manages to disrupt it and we just continue on the same trajectory, then I think it's pretty unquestionable that the cost is going to become higher. Because there's a limited number of credentials that each of these elite colleges can give out each year, and you have essentially the entire world now competing for one of those credentials. And so just supply and demand, the cost is going to keep going up.
I think the value of that credential is going to continue to go down, because there are still ways to demonstrate your potential that don't require that credential. So there's a story, I think Facebook hired a 16-year-old or something who built an app that climbed to number one in the app store. For those kids who have enough agency and enough talent, they can find ways to demonstrate their potential that don't require a half million dollar credential.
And so I think as more of those opportunities are created, you'll see more and more kids opting out of that college path. But I think still, that college credential is still a positive ROI bet and it is still sort of the most straightforward path to getting a good job. And so I think the band is going to stay pretty high for that until there's a major disruptive event.
Turner Novak:
Interesting. I don't know if this is specifically related to this, but it reminds me of there was this study that came out recently. I didn't check the source, it maybe completely bogus or a small sample size or whatever. I think the question was, what level of income do you think you need to be, it was either successful or happy in life or something. And it was like Boomers, Gen X, Millennials and Gen Z. and basically Boomers were like 80K. Gen X was like 120, Millennials was like 150. It kept increasing as you went down. And then Gen Z was like $600,000 or something. I was like, whoa.
If you just increase for inflation or whatever, I could definitely see how we go up. But there's almost like this... Gen Z sees the world differently, I think. And I don't know if it's related to the cost of education, cost of living, how the internet and remote work and being able to run a business online has kind of changed things. I still don't have a strong opinion on it, but I'm like, man, there's something going on. The world that they're growing up in is much different than the one I feel like we grew up in.
Niels Hoven:
Yeah. My take is so much of this comes from social media. When we grew up, you never saw what the lives of billionaires were like. You didn't know that people were jetting around the world on their private jets to eat at the finest restaurants whenever they wanted. And now if you go on Instagram, it's in your face all the time. You're aware that there is this lifestyle that exists. And you wish you had it.
Turner Novak:
And you spend time looking at it and the algorithm pushes the things that people spend time on. So it definitely becomes the reality and the expectations I think gets completely thrown off by some of that stuff.
Niels Hoven:
It's really hard to say. That there are people out there who have this incredible lifestyle that they don't deserve, that they did not earn at all. And I am not going to have it. I have to find a way to be happy with whatever I have built for myself and I'm not going to have what they have. And whatever that lifestyle is that's available and at $100,000 or $200,000. Sometimes it's hard to be happy with that when you know that people eating caviar every night. I don't don't actually caviar, but that's just my example.
Turner Novak:
Yeah, I've never actually had caviar before. But I know it's expensive and people like it, I guess. I don't know.
Niels Hoven:
I feel like I've seen it at buffets. Yeah, it's salty. That's all I remember.
Turner Novak:
One question I really like to ask people. Do you have a favorite kind of founder or CEO or company, whether it's current or throughout history? I mean this can be centuries ago. But just that you've kind of gotten inspiration from or learned a lot from as you're building Mentava?
Niels Hoven:
I would say that the company that I respect the most is Stripe. And I actually don't even know that much about them. I haven't studied them that much. But it just seems like just consistently, over time, they have such a good understanding of what the market wants and where the market is going and what to build for their customers and how to do it in a way that delights people. It just seems like they're hitting on target over and over and over again, and everybody I meet from the company are really smart, really motivated, really nice people. So it just seems like they've built a really nice crew of super talented people building something that the world wants, and I have tremendous respect for that.
Turner Novak:
Which is basically what this all is at the end of the day. All these numbers or what you value a company out of, at the end of the day, it's just like a team, a group of people that builds the product, that ultimately is what flows down into the results of the company. Whether it's the outcomes, how smart the students or the kids, how fast they're reading and how much revenue you do, how much cash flow you generate, all that stuff. It all starts with, who are the people that are working on it?
Niels Hoven:
Yeah. And it's a bunch of people who are getting together to see an opportunity to make the world work better, have decided to try and make the world a better place together.
Turner Novak:
Yeah. I think that's a good spot to end it. I feel like we hit on a lot of stuff, but this is a lot of fun. Thanks for coming on the show.
Niels Hoven:
This is really great. Thanks a lot, Turner.
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