Michael Moe is the Co-Founder of NeXtAdvisors, LLC, a strategic advisory firm focused on the education sector. Michael has over 20 years of experience and previously co-founded and was CEO of ThinkEquity Partners, a growth-focused investment bank. In 2007, he published his first book, Finding the Next Starbucks: How to Identify and Invest in the Hot Stocks of Tomorrow (Penguin/Portfolio Books, 2006), which has gone through three printings and has been published in five different languages.
He is also the Co-Chair of The Education Innovation Network at Arizona State University (Skysong, Scottsdale), an “open innovation platform where entrepreneurs can find the resources to validate concepts, accelerate growth and reach transformative scale. The Education Innovation Network is designed to bring together, in one physical hub and virtual portal, the most innovative companies working on improving education, the intellectual assets of ASU, the greater Phoenix public and private educational K-20 systems and investors of all types – philanthropic, angel, venture capital and large-scale acquirers.”
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KCH: Let’s start with the objectives, Michael. What outcomes do you hope to see from this initiative?
The primary goal for the ASU Education Innovation Network is to serve as a catalyst for accelerating innovation not only at ASU but also nationally and globally. By creating a physical and virtual economic cluster around education technology and innovation, we believe this will be a tremendous resource for the education entrepreneurial ecosystem.
KCH: I imagine that many universities would love to create hubs like the EIN at ASU. What is it about Arizona State University that made this private-public initiative possible?
First of all, I hope another outcome of what we are doing with the Education Innovation Network is that it serves as a model for other universities to replicate… and connect into. Back to your question, a number of different positive factors are present at ASU to enable this. 1.) ASU has a very strong visionary leader in President Michael Crow. Under President Crow’s bold leadership he has set in motion a very clear game plan of the role of education in a rapidly changing world. 2.) ASU has a tremendous amount of resources for the largest number of students on one campus at a U.S. University. It has a forward looking teachers’ college that has many unique initiatives such as its partnership with Teach For America, which aspires to have a scale impact. 3.) ASU has a substantial research commitment and has recently brought in a highly regarded head of research from Vanderbilt. 4.) Phoenix is the headquarters for the largest for-profit postsecondary university in the world with the University of Phoenix and other leading for-profit postsecondary schools such as Grand Canyon and Universal Technical Institute. 5.) Arizona has a history of being a leader in education reform including being a robust early adopter of charter schools. 6.) The Phoenix area also has a vibrant corporate community including substantial companies like INTEL, Honeywell and First Solar. 7.) To put an exclamation point on all of this, ASU specifically and Arizona in general has a mindset that is consistent with its western frontier roots that embraces change and isn’t afraid to try new things.
KCH: One of my long-held frustrations with the education sector is that it has not traditionally attracted the “best and brightest” of our entrepreneurs. Is this changing? What do we need to do to ensure that education benefits from the energy and innovation of entrepreneurs?
Yes, we are at a major inflection point. Young talent being attracted to an industry is one of the best, if not the best leading indicators of a coming wave. We are seeing a substantial interest in the education industry as an entrepreneurial opportunity.
The Education industry has historically been very risk adverse and might be appropriately so as we have all heard the expression, “Go experiment with someone else’s kids.” However, in attracting big fresh ideas from entrepreneurs, we need to recognize that there will be some failure. There is an important difference between being reckless and being innovative and the education industry needs to make sure we support new ideas without being irresponsible.
KCH: From an investor’s point of view, are there specific companies or areas of the education sector that you believe are particularly promising?
Yes. For a more extensive perspective please read my weekly commentary link below:
Some quick areas of particular notoriety: In the K-12 space we are seeing an opportunity to create a learning platform and collaboration around that platform (think iPhone and apps). For the first time in the education market, we are starting to see companies create network effects, which is powerful for both the investor and for the learner. Additionally, adaptive technology is being applied to the learning market – it is exciting to see that the same technology Amazon uses to recommend a book and Netflix uses to prescribe a movie can also be utilized for individualized learning. Virtual schools will continue to be a ripe area for growth investors, and entrepreneurs that provide tools and training for teachers are also in a sweet spot. In the higher education market, the recent scrutiny of the for-profit colleges ultimately creates an opportunity for post secondary institutions that deliver superior learning outcomes and a strong ROI for the student. A huge trend is the partnering of not-for-profit universities with online partners to create internet courses. Lastly, social learning is going to be a fundamental component of any successful college program in the years ahead.
Michael Moe, Bio
Michael has over 20 years of experience and previously co-founded and was CEO of ThinkEquity Partners, a growth-focused investment bank. From Think’s inception in July 2001, the firm grew at a 50% CAGR to $70 million in revenue in 2007, reaching 180 employees. ThinkEquity was sold in March 2007 to London-based Panmure Gordon. Prior to that, Mr. Moe was Head of Global Growth Research at Merrill Lynch and before that he was Head of Growth Research and Strategy at Montgomery Securities. Mr. Moe has been named to Institutional Investor’s All American research team and has been awarded Best on the Street by The Wall Street Journal. Additionally, he has been called one of the best stock pickers in the country by BusinessWeekmagazine. He has testified in front of the U.S. Congress on the subjects of education technology, the new economy and initial public offerings, and he has also appeared before the President’s Information Technology Advisory Committee. He is frequently cited in publications such as The Wall Street Journal and The New York Times for his opinions on growth companies and appears regularly on financial programs on CNBC and Fox Business News.
Mr. Moe is a contributor to the AlwaysOn Network – a blog site about new media technology and venture capital news. He is a member of the New York Society of Security Analysts, the San Francisco Analyst Society and is a past advisor for the Center for Innovation. He is on the Advisory Board of Institutional Venture Partners (IVP), a member of the Board of Directors for the Center for Education Reform and on the National Advisory Board for Community in Schools. Mr. Moe is also on the Board of Directors of Sharespost, an alternative stock market for private, emerging companies and on the Board of Advisors for the Venture Capital~Private Equity Roundtable. He was on the National Finance Committee for John McCain’s Presidential Campaign, and was a policy advisor. Mr. Moe is on the board of directors for the National Football Foundation/College Football Hall of Fame. In 2007, he published his first book, Finding the Next Starbucks: How to Identify and Invest in the Hot Stocks of Tomorrow (Penguin/Portfolio Books, 2006), which has gone through three printings and has been published in five different languages. He earned his BA in Political Science and Economics at the University of Minnesota.