Portfolio Review: TopSchool Inc.
This week, TopSchool Inc. is introducing itself to its world, which is the world of for-profit, post-secondary educational institutions. That’s a mouthful, but it’s a significant mouthful because those schools, ones designed to address specific educational needs and to make a profit while doing it, have grown into about a third of the entire college-level educational system. That’s right: A third of the money paid by people attending school after high school is not paid to the institutions we all identify as our college and university system.
Instead, there is a large and vibrant system of schools — small and large, broad or narrow — that are run as profitable businesses. And our company, TopSchool, has developed the software to provide a service to these schools that is both their core function (keeping track of their students as customers) and that is still largely locked behind client server systems developed as much as 20 years ago. By providing that software as a service, TopSchool will also enable these schools to go beyond “merely” keeping track of their customers into new and innovative ways of recruiting new customers as well as providing service to existing customers. (We even think that eventually we can provide a Facebook application to our customers’ students that will help them register for classes and manage other aspects of student life.)
TopSchool is a great entrepreneurial story. The company was started several years ago by an engineer, Harout Kertajian. Harout got the basic idea right, which was to provide a school information system as a service rather than as licensed software. But he needed an aggressive, business guy to help him get the company financed and ready to roll out and that guy is Leon Lo, the entrepreneur whom we bet on in making our investment in the company.
The most remarkable part of this story is that Leon actually replaced himself as CEO of the company before we even had a chance to invest in it. Leon recruited two top executives from eCollege, now a division of Pearson Education, to become respectively the CEO (Matthew Schnittman, former president of eCollege) and SVP Sales & Marketing (Justin McMorrow, former VP Sales & Business Development of eCollege and a thought leader in alternative forms of secondary education to boot). Leon also up and moved him and his family from Southern California to Denver to create a new home office for the company. We love that Leon has the drive and vision to do everything that is necessary to help a great new company started, even if that involves relocating his family and reorganizing himself into a new job.
And we’re thrilled to be helping a new company bring the software-as-a-service revolution to a fast-growing industry that is on the leading edge of inventing new way to educate and train us.
August 5th, 2008 at 9:53 pm
Awesome!
Tack on google apps for domains, problem solved. http://urbansemiotic.com/2006/09/01/google-apps-for-boles-university-review/
I used to work for one of those big ivy’s on sand hill supporting IT. Mostly, there’s a hodgepodge of custom apps and a panoply from filemaker pro (fmp) to oracle rac out there, but it’s very spotty. Some operations are top-notch (like cluster computing), but it doesn’t help if it’s not shared and standardized. Other shared realms, like information security need some immensely serious help.
TopSchool has definitely hit it: every niche needs it’s specialty suite, and often folks don’t have the time/resources to manage a production infrastructure to the level of quality that this entails to run a business-grade app from a home-grown system. The devil is in the details. From an eight-figure mobile FMMS implementation it was discovered: the vendor knows best, and often it’s hard to communicate subtle configuration differences buried deep, such as oracle configurations, that can bring the tier of cards crashing down.
Collectively, I’d say there’s a > $250 m/yr market cap on this easy. Top 100 schools x $2.5 m/yr … which is the size of a medium acad IT shop’s budget. Much more goes wasted on failed / immature IT projects every year, but no one really wants to fess up to that fact or they may not get their budget again next year.
Kudos again.