with Spencer Greenberg
the podcast about ideas that matter

Episode 051: Educational Restructuring and Investing (with Matt Greenfield)

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June 18, 2021

How can we restructure schools around student needs? What sorts of skills do people actually need in the 21st century, and how can education systems reorganize themselves around those skills? What sorts of things do impact investors look for when investing in education companies? How can teachers cultivate critical thinking and passion in the classroom? Should prejudice and privilege be addressed at the primary or secondary levels of education?

Matt Greenfield is a managing partner of Rethink Education, a venture capital firm that invests in education technology businesses. He previously helped start Rethink Autism and worked for ABS Ventures. He holds a B.A., M.A., and Ph.D. in English from Yale University and has taught at Columbia University, the City University of New York, and Bowdoin College. You can find him on Twitter and Clubhouse.

JOSH: Hello and welcome to Clearer Thinking with Spencer Greenberg, the podcast about ideas that matter. I'm Josh Castle, the producer of the podcast, and I'm so glad you've joined us today. In this episode, Spencer speaks with Matt Greenfield about restructuring the education system, impact investing in education, and cultivating critical thinking and communication in the classroom.

SPENCER: Matt, welcome! Glad to have you on.

MATT: Thank you so much for having me.

SPENCER: The first topic I want to ask you about is the education system and, in particular, your thoughts on why we need to reshape the education system around the needs of students.

MATT: I think that a lot of students, even before the pandemic, experienced school as a very alienating place, not just because schools often look a little bit like prisons, but because schools are experience-distant and they're not related to the most passionate interest of the students. And the students don't get their individual passions and fears recognized.

SPENCER: So what do you see as the upshot of that? Is it that students are just disinterested, they're not learning as much as they can?

MATT: They become steadily less creative over time as they progress through their education. If they succeed in school, they get good at memorizing facts and procedures. They don't necessarily get very good at generalizing or doing far transfer of the things they learn. Even many engineering or science majors don't have the ability to recognize the mathematical principles that they're mastering in one context when they show up in another context. But also the things they learn are just not all that closely related to the kind of work that any of them do afterwards, which involves collaboration, going deep on a topic of passionate interest, generally understanding why it is important to learn something, as opposed to, "This is trigonometry. You have to learn it so you can go on to learn calculus, get into a good college, get a prestigious job and make a lot of money, and then in your spare time pursue your hobbies with a larger amount of money, or when you're retired, pursue the things that you're really passionate about." A lot of people end up going into one of that narrow range of prestigious professions just because it's the thing to do. Going to law school is a default option if you're good at school and don't have another option in mind and a lot of people end up becoming corporate lawyers and discovering that they don't like it. Or they end up going to graduate school and getting a PhD and discovering in that process that they're not good at teaching or that they don't enjoy it.

SPENCER: I've actually seen some studies on lawyers. I don't know if this is still true today, but at least when the study was done, they were one of the least happy groups of people which was quite astounding.

MATT: So what should education look like? Well, it certainly shouldn't have grades. Particularly now, I would say, pretty much every K-12 or college-age student — if there is a particular age for college anymore — has experienced clinically meaningful levels of trauma. If you design a place to feel safe and welcoming, it would greet you as an individual. It wouldn't start making you take quizzes and grading you and weighing you against your peers in all sorts of ways — even in the gym, getting chosen in order of athletic ability for the two teams that are about to engage in some sort of athletic activity — none of that is what you want for learners who have experienced meaningful levels of trauma. So if you start by thinking that you need school to feel safe, you start by asking them, "Who are you? What are the things you're interested in? What sort of action in the adult world would you consider heroic? How could we get you started on that kind of action today?"

SPENCER: I want to ask you about that trauma piece that you're referring to. What sort of trauma do you think students are coming in with?

MATT: I know that you have done some research on American attitudes towards trauma, and so I must pick my words carefully. But I think that the trauma can have come from violence experienced at the familial level, or in the context of school bullying or violence between school and one's home, or in perhaps another nation before one immigrated here. It can be the indignities of poverty in the US, and the struggle to get one's basic needs met. It can also come from illness, when a single illness in this country (unlike in most other affluent nations) can be economically catastrophic for a family.

SPENCER: Now it seems like there are two competing viewpoints when it comes to a kid who's had a difficult life. One viewpoint is that you want to be very gentle with them and you want to build up their strength. The other viewpoint is that you want to challenge them. Like the vaccination model, you don't want to avoid putting them in stressful situations. You want to put them in controlled stressful situations where they can become more resilient through dealing with that stress. One way this plays out is that some people say, "To handle bullying, you should handle it at the school level, and you should have severe punishments for bullies." Another viewpoint says, "Well, bullying is inevitable and it's actually better if you don't intervene so kids can learn how to deal with these stressors that are inevitable." I'm curious where you land on that.

MATT: I had an interesting conversation with a superintendent last night about this very question. I made similar remarks about trauma and she, in her initial remarks, talked about the importance of not lowering the bar for Black and Latino students, or others who are economically vulnerable, or vulnerable in some other respects such as having special needs. We talked a little bit about the tension between those two things, and she had mentioned growth mindset. I think that might be the point where those two things meet to give a learner the sense that their abilities are not fixed and their abilities will follow their desires, and their commitments and their practice is a very powerful thing, which can allow you to challenge them. I just think that a lot of the challenges being set in school are not meaningful, and are negative or unsolicited attention that persists over time and involves a power asymmetry. I thought, "This sounds like a pretty good definition of the relationship between the school system and the student." The student doesn't ask to be graded. If the student plays a game, then the game provides feedback of various kinds but the student always remains in the zone of proximal development, if the game is well-designed, and is at a pleasurable level of challenge, with something that they find inherently interesting. The problem is that nobody ever explains in detail why you need to learn a particular thing. Explanations of why the curriculum is shaped the way it is are generally mealy-mouthed and hypocritical. Also, you're almost never asked at any school to reflect on how you learned, what your learning style or interests might be, how your courses are related to each other, how the gestalt of what you're learning at any given moment might be related to your goals, what's the pathway to your personal goals — your goal of being an adult who is successful as a worker, as a citizen, or successful in civic engagement and as a family member— you're not asked about those things.

SPENCER: It seems to be that part of the problem might be that we treat education as this magic black box. We show the students all this information, and somehow that makes them better people. But we don't really go into the theory of change, like how it is that teaching them all these facts actually makes them a better person, or a smarter person, or a more wise person. I think a lot of it is just hand-waving.

MATT: I think exposure to adult experts is definitely a very powerful form of education. We should do a lot more of it. That does not necessarily mean just experts who are doing things that are prestigious in the adult world, the scientist. That means sitting down with a farmer and learning how to milk a cow, and learning what the challenges of managing a large group of cows are.

SPENCER: It seems like a lot of kids would really be interested in that actually.

MATT: It'd be fascinating, and they would learn a lot about biology and commerce at the same time. I was reading a book by Atul Gawande called "The Checklist Manifesto," and there's a fascinating chapter on the role of the construction manager, particularly in a complex high-rise building. The construction manager has to understand a lot of science and has to integrate the work of the architect, the lawyers who deal with the regulators, the welders (in some cases), the carpenters, the people who plan the interior design, and clients for the building (if they've already signed up). When one thing needs to be changed, the consequences cascade through all of the nested checklists, and influence all of the schedules and processes in ways that require a lot of thought on the part of the construction manager. That's a fascinating kind of complexity which I was never exposed to anywhere in my education. I guess maybe when I was in primary school, I went on a trip which I still remember, to the Bigelow tea factory in Norwalk, Connecticut. (Maybe it was Bridgeport.) That was memorable and interesting. I think there should have been a lot more of that and maybe a lot less of some of the other things that we did.

SPENCER: It seems like very often kids think about, "Oh, what do I want to do with my life?", and they're modeling some very abstract version of different professions. But if they actually got to see the profession more up-close, they'd realize it might be very different than they thought. It might be more interesting or it might be less interesting. For example, someone I know, when they were young, wanted to be a biologist and they ended up actually working in a bio lab, which I think was a great way to find out what it was really like. And they realized, "Oh, wait, this is really not what I thought it was," and there's a lot more hands-on, using pipettes, moving liquids and things, and a lot less of what they imagined they'd be doing.

MATT: Absolutely. I think that studying the work of adults should be a large part of the curriculum, perhaps the largest part.

SPENCER: Isn't it largely what play is about, mimicking adult behavior?

MATT: Yeah. I wrote a statement about my beliefs about education and why I would like to invest in — I'm an investor in education businesses by trade — and one of the things I said (I can more or less quote it) is, "education at every level should combine the playfulness of preschool, the intense collaboration of a hackathon, and the deep self-guided exploration of a doctoral program."

SPENCER: That's great. But not many schools live up to that.

MATT: Well, the playfulness is critical but also the deep self-guided exploration. If you can figure out, "Oh, this child right now is passionate about becoming a police officer," that may be very far from where she ends up as a grown up. But she's passionate about that right now. Let's try and build her entire personalized curriculum around that desire so that it's all coherent, and so that she is using the institution to pursue her own chosen goal rather than being told by the institution what to do and continually asking, "What does the teacher want? What do I need to do to get an A? I'll stop the moment I've done enough to get an A. What are the graduation requirements? How do I get into a good college?" Those are not productive questions to ask. They're not even the questions ultimately that college admissions officers want you to be able to answer.

SPENCER: It's interesting to think about the motivation of students, like why do students bother learning the material that's taught to them? One potential motivation is because they find it interesting. They're curious about it. Another motivation is fear that, if they don't learn it, something bad's gonna happen: their parents will be upset, their teacher will be upset, or they won't eventually achieve their long-term goals. I'm wondering, do you think the ideal is that almost the entirety of the motivation is by interest? Or do you think that there's a healthy mix of those things?

MATT: There's definitely a mix of those things but if you really want to go far and go deep, then it needs to be driven by passion. Fear is not ultimately the right kind of motivation for real success. The student should be redefining the task in a creative way rather than just accepting it and doing whatever the teacher wants, which is ultimately not the way that one succeeds in life. No employer wants you to wait to be told what to do. They want you to solve problems. They want you to figure out what problems to solve and to define questions. People aren't being encouraged to think for themselves in that way in school. The experience of being a mathematician — there are a number of professors who are very eloquent on this — is the experience of exploring things that seem interesting to you and noticing things, "Oh, that's interesting." The experience of math in most classes today is extremely structured. It's based on a semi-illusory notion of unnecessary sequence and unnecessary scope which, in fact, is completely illusory. A number of people that I respect have pointed out that there are a lot of different ways that you can say that calculus is still valuable. Some people would say that, for most students, it isn't, that it shouldn't be the goal. You should take more probability and statistics. One of my favorite writers on education, Clark Aldrich, the author of "Unschooling Rules," says that calculus should be considered one of the noble monuments of the human intellect and shelved in a museum alongside the potter's wheel and the spinning wheel. But others say, "Well if calculus is important, let's spend a lot of time talking about what it's for (which I remember being a little fuzzy on even after I had taken the BC calculus exam). Let's spend a lot less time talking about proving the theorems and solving the equations, like learning how to find an integral by hand, which is not necessarily all that useful. Let's show people how to do it on a calculator first and then, if they want to dive deeper, they can." For a long time, people thought that you had to learn how to use a slide rule in order to be mathematically educated and to understand what logarithm was. Turns out that's not the case.

SPENCER: As a mathematician myself, I love the software Mathematica which will do all kinds of crazy integrals and very complicated symbolic calculations for me automatically. I don't know why I would do this by hand, given that I have software that can do a lot of that, and then I can focus on the interesting creative parts.

MATT: I never reached higher level math. But the way it's been explained to me is that it's very different from your experience up through maybe your second year of calculus. Suddenly you're thinking about abstract classes of things and transformations of those classes. It's maybe a little closer to the kind of creativity that one experiences in the arts.

SPENCER: Yeah, I think as you get to more pure math especially.

MATT: The playfulness and the exploration don't really exist in most mathematics instruction at the primary, secondary, or even early college level. Of course, probability and statistics is much more essential as equipment for living.

SPENCER: I think a lot of students couldn't even see where creativity would fit in. Because the way it's taught just feels like, "Here's the right answer and everything else is wrong. What are you going to do? Design your own algorithm for doing multiplication?" In fact, there are a lot of different ways to do multiplication. But I think you have this feeling in school that is, "No, there's just one way to do it." It's the exact opposite of creativity.

MATT: Have you ever seen ST Math, the math learning program created by Mind Research Institute, which is a nonprofit?


MATT: Most math software basically drills you. You get an equation and you have to solve it. Sometimes there's a gamification element which involves being able to play a game after you solve the equation, or when you solve the equation, you're also blasting an alien. ST Math is different. It really teaches mathematical concepts on an intuitive level. I still remember the first time that I heard the words numerator and denominator, not just the first time, but I remember struggling with it a little bit in whatever grade that was, third or fourth grade. Numerator and denominator are not intuitively obvious or appealing terms. How about 'top number' and 'bottom number'?

SPENCER: I like that better.

MATT: The way that ST Math goes about teaching fractions is that you're trying to help the penguin cross the ravine. Initially, you have a single block that you can deploy as a bridge, and then you get two blocks and you snap them together. Each of those blocks is half as long as the original one. Then you get three blocks, and then you get four blocks, and then you get combinations of blocks. You're learning to multiply and divide fractions and eventually add and subtract them as well, in ways that don't require you to ever learn the words 'numerator' or 'denominator.' So by the time you start on formal study of it, you have a deep understanding of what is actually being talked about.

SPENCER: I see. So in order to solve these problems, you actually effectively have to do things like divide and subtract?

MATT: Yeah, but it's usually pretty obvious what the solution is. There's another really fascinating math program. It's an iPad/iPhone app called Dragon Box.

SPENCER: Oh, I've used that. That's fantastic. Yeah.

MATT: It's a game that teaches you the rules of algebra using a purely visual methodology. You learn how to balance an equation. There are nine-year-old kids learning the rules of algebra, which is fantastic. It also demonstrates the perhaps superfluousness of algebra as a fundamental piece of mathematical equipment but certainly nobody knows what to do with it. It's useful when you're being taught algebra and it's useful maybe later on when you're in precalculus. But nobody knows what to do with that in the context of formal education. It's cool and it's a program that works and there should be more programs like that.

SPENCER: Just to elaborate on how that functions, if I recall correctly, early on in the game, you're balancing the equation but you don't really realize it's an equation because it's just a bunch of symbols. They're not normal math symbols. You're just thinking of it as a puzzle, and then as you get to higher and higher stages, eventually they start introducing the real math notation. Suddenly you realize that the structures you learned are the structures of mathematics. But until that point, you could have easily just been ignorant of that.

MATT: Yeah, and you're really learning the fundamental principles before you learn the formal notation, which is fantastic.

SPENCER: I also really like the idea of games where there's something that the student is likely to be intrinsically interested in, whatever the topic is. Maybe the student's really into sports or maybe into music or whatever. Then there's some question posed about that topic that they're like, "Oh, I would like to know the answer to that," whether it's "Who's the best baseball player ever?" "What is the distribution of pop songs in terms of popularity?" or whatever it is, or something that can be attached to this intrinsic interest of theirs. And then the math follows as, "how do you answer this question?" And the answer is the math. But now you have a reason to learn it and there's something you're excited about knowing.

MATT: I couldn't agree more. One of the great educators I've ever met, a guy named Carl Wendt, used to teach at High Tech High and before that, he was an industrial engineer. He went on to run project-based learning at Khan Academy. When he was at High Tech High, he would have students build robots and the students would divide into groups. These are not students with any particular depth of interest in STEM but he would ask them to imagine the robot performing some kind of task. Some of the ones I remember are: a swimming robot that would ingest a glowing food pellet and then excrete it and have it stop glowing, or a rescue helicopter that would pick up a Lego figure that was a mountaineer that had been stranded on a mountain. They would then have to master a bunch of skills in order to try to build that robot. They'd have to learn how to use an Arduino controller and how to program it in C. They'd have to learn how to use the jigsaw, how to solder, and how to test something like, "why does the robot keep filling up with water and sinking?" So it was incredibly moving because those kids would never look at any problem in their lives in the same way again. Before they went into that class, they looked at it and said, "Do I know how to solve it? No, okay, forget it." Or "would it be difficult to solve it?" Maybe if it's difficult, they don't even try. After this class, they know that they can address a really hard problem, a visionary goal, and master multiple skills en route and maybe modify the goal and prune it back a little. I mention it because you're talking about motivated math, learning math because you need something. Some of his students were building helicopters and the helicopters kept crashing. They couldn't figure out how to adjust for the angle at which the helicopters were tilting. Carl said, "Maybe you need to look at the rate of change of the angle." The student said "Yes, yes, I get that. That makes sense." They were headed into calculus, coincidentally, at that particular point. So calculus actually had a purpose for them to keep the helicopters from crashing. Most schools never get anywhere near that level of authenticity in the curriculum. So to get back to that earlier idea of the student who wants to be a police officer, you should customize the entire curriculum around that for her. You should give her math problems that are related to policing and crime and community work. You can easily refashion a history curriculum around questions of policing and justice: "How has justice changed? What was the ancient Greek conception of justice? How is it different from our conception today?" Those questions suddenly become really interesting in the context of someone's vocational ambition. That person might become a lawyer or biologist or something entirely different but as long as she is interested in being a police officer, that is an armature onto which you can build a robust curriculum. Now that curriculum, you may not want it to contain the same things that it contains today and the state standards are part of the obstacle here. It's not just institutional inertia or the unwillingness of people to learn differently. As Clark Aldrich says, there are a lot of different kinds of institutions that are just better designed for authentic learning than schools are. Those include summer camps, sports teams, school newspapers, clubs, online role-playing games, YMCAs, 4-H clubs, and family trips, all sorts of other things where the learner is pursuing his or her own interests in an authentic way where there's a community. Another way to put this, there's a writer named Jean-Paul G, whom I just encountered, who explained this in a way that was very helpful to me. A lot of the things you learn in school — like mathematical notation and equations, or biological facts — are stripped of the community context within which a grown up practitioner uses them. They're not part of a community in which you can be an apprentice and conduct experiments and gradually earn your way to higher levels of authority and respect. They're rendered meaningless by the absence of that context.

SPENCER: I imagine many people would find the ideas you're talking about really appealing, like the idea of motivating learning towards a goal and embedding it in the community and having a self-directed orientation. What I'm wondering is, people might also say, "Well, that's pie in the sky. How could that realistically be achieved in a public school that's not that well-funded?" I'm curious to hear your thoughts on how we put this stuff into practice.

MATT: For one thing, kids are putting it into practice all the time on their own time. The example of massive multiplayer online role playing games is a very powerful one. There was a former Electronic Arts executive speaking at a conference I went to once. He said, "People say that we haven't figured out how to build educational games that really work yet." That's true if you're talking about teaching people the rules of algebra. I guess Dragon Box had not yet been created at the time of this conference. But let's think about how your 15-year-old is spending all of his time playing World of Warcraft. You're wondering whether it is a time sink, whether it's making him antisocial, or whether he should be spending more time doing schoolwork. This 15-year-old might be leading an expedition to attack a castle and defeat a monster that takes three months of planning, involves a team of 40 people with different specialized skills, and a lot of practical learning along the way. And the average age of those expeditionaries is 35. Your 15-year-old is like the CEO of a major corporation. Is that not educational? There are lots of different kinds of education. There's a great book by Clark Aldrich called "Everything Bad is Good for You," which talks about video games, as well as television and other things that people are concerned are bad for us. In the case of video games, he starts off with a letter from an alternate universe in which kids have been playing video games for centuries but they only recently started reading. This letter is from a group of concerned parents and it says, "We walked by the library the other day and we saw our kids lying down with these books, not moving, subjugating themselves to someone else's narrative rather than creating their own, not using their bodies, not socializing with each other. It was terrifying and they looked like corpses."

SPENCER: That's a funny example. I have mixed feelings about this. Because I completely agree that some video games can teach important things. I think the example you gave, planning this expedition and leading your people is a really wonderful example of that. But on the other hand, video games are also the thing that people consume more than they even want to consume them. In other words, the next day they're like, "Oh, man, why did I play for seven hours yesterday? That's such a dumb idea. I regret that." Video games seem like the thing that creates a lot of regret. I'm curious how you think about that.

MATT: I guess for one thing, it depends on the video game. It depends on whether it's a multiplayer game, as well. There are some games that I play as a way of self-soothing that are a lot less productive, casual games on the phone. So I'm not saying that video games are better than school in every case. But I think that one needs to find the things that really engage students and start with that as the foundation for education. I think it's good also — we used the phrase community before — you were talking about my idea that learning and intellectual activity happen within some kind of community and we often don't provide that community within school. But there's also the community in a larger sense, like the family, and the city or town where someone lives, and the country and the issues within that nation. Tying the academic projects to that is incredibly motivating and valuable. There was a study a few years ago by The Pew Charitable Trust that found that two-thirds of American adults could not name all three branches of government. That number has actually gone up considerably recently, in part because of actual conflicts between those branches which foregrounded it for people. But let's say you ask a question about violence in a community — police violence, perhaps for that particular student who wants to be a police officer — that's a question that people have really intense feelings about. They don't necessarily have all the facts. But once you ask them to do that, maybe you ask them to do a simulation or a debate, they will figure out a lot about the way that laws are created, interpreted, and enforced. They will learn the facts of civics in a way that they seem not to today.

SPENCER: That makes a lot of sense. How do you take some of these ideas and put them in the classroom?

MATT: I made a small investment in a school that has fantastic pedagogy. The students get together in groups and decide on what they're going to do next. The school's tutors or guides push them, coach them but don't determine what they're working on, but do track which competencies they're mastering. Apparently, this method works much better with everything other than math. If you want to meet the state math standards, you do have to constrain what they do to a much greater extent, but everything else can be self-guided.

SPENCER: Do you think it's realistic to scale these models?

MATT: Yes. This particular company, Sora Schools, is charging on a sliding scale based on parental income of $300 to $800 per month which is below where public schools come out in most areas. It's online, which saves money. But because the students are doing a lot more of the deciding themselves, that also reduces costs.

SPENCER: It's fundamentally online?

MATT: Mm-hm. That won't be right for everyone obviously, but the model is not costly. It's also just easier and more pleasurable for the teacher. I'm a former college professor getting up in front of a class full of people and trying to get them to be interested in something that the curricular standards say they're supposed to be interested in when they're not inherently interested in it. It's tough. After two hours, you've got flop sweat. You feel like you've been in the wrestling ring or running a marathon or something. Being a coach or a guide towards something that they're intrinsically motivated by, that's a lot easier. Or to put it another way, almost no one is disengaged in a one-on-one or one-on-two or one-on-three conversation. That's the gold standard, we need to preserve more time for that in education. The fact that it's easier and more pleasurable for the teacher, and it yields better results, I think the moment that Sora and other pioneers — High Tech High to some extent, and the Acton academies — demonstrate that it's better for college admissions, there will be a massive move on the part of traditional schools. So I told the CEO of Sora that if he has 50,000 students five years from now and is making a ton of money and that's all he's done, I would regard him as having failed. I want to see him have a massive effect by example on other schools.

SPENCER: Do you think the college admission process basically is just going to feed back into what schools are, so if someone can prove that, "Oh, if you do this new innovative type of school, you'll get into college at a higher rate. You'll get into the best colleges," and the whole system will start moving in that direction?

MATT: Yeah. Colleges are starting to dispense with the SAT and ACT or make them optional. Enough colleges did it during the pandemic just because kids couldn't get the tests at all. They're optional. So kids will take them and, if they help, then they'll submit them. But if they're harmful, they may just apply to schools that don't require them. We'll see. They're still useful. They're helpful to the admissions department in sorting through students and grades are helpful, too. But if you look at the more selective schools, neither the grades nor the SATs are dispositive. What they're looking for is someone who is passionate about something and has done original work in that area. What I'm describing is ultimately the most important factor in whether you get into Brown.

SPENCER: How do you feel about less usage of SATs?

MATT: I think that in the absence of other signals, one still wants to use them to allow people to pop out of the crowd when they're especially good at taking tests. But at the same time, you don't want lawsuits like the one at the University of Texas, where people say, "I got SAT scores better than some of the people who got in. There was affirmative action and that hurt me," when in fact, the total context of what a student has experienced and overcome is a lot more interesting than the SAT score by itself.

SPENCER: It seems bizarre to use that as the only piece of information.

MATT: The College Board itself is starting to offer demographically adjusted SAT comparisons based on where you live or where you went to school. I think that's a helpful thing to do. If you don't have them, there's the risk that the selective or more competitive schools will end up relying on the schools that they're most familiar with, which are schools, for the most part, in more affluent areas, with the exception of certain charter networks, perhaps.

SPENCER: What do you think the evidence is on how much people can game these tests? As far as I understand it, the designers of this test say, "Oh, yeah, you can't really improve your score much." But then you have this massive industry of teaching people to improve their scores. Where do you land on that?

MATT: You can absolutely teach people to improve their scores dramatically. Practice and coaching definitely make a difference.

SPENCER: Does it end up being more of a combination of verbal ability, math ability plus how much you practice where how much you practice probably breaks into: how many resources were you given from your school, your family, as well as conscientiousness?

MATT: Absolutely. There are tutors charging up to $700/hour. It would be foolish to assume that they don't make people better. They have evidence that shows they do.

SPENCER: Insofar as it's mapping onto conscientiousness, that seems like a reasonable thing to select for. Insofar as it's mapping onto resources your family can give you or your school can give you, that seems like clearly not what we want.

MATT: I was just talking to a French academic about a startup that I would like to build in Europe. She was talking about how the universities in France are free. They're also extremely hierarchical and they require a lot of preparation to get into. The admissions process is entirely objective in the sense that you take an entrance exam, and that determines where you're able to go. But there are people who go to special schools that prepare people for those exams and spend hundreds of thousands of dollars on tutors to ensure that they get to the Ecole Polytechnique, Sciences Po, or whatever. A great many of the senior leaders in the government happen to have gone to Sciences Po. The US is more democratic than most European nations, especially than France, in at least one respect which is that you can go to a college that is not selective and still get into a selective graduate program. And you can go to a second or third year graduate program in many disciplines, although perhaps not in certain disciplines like economics that are more hierarchical. You can go to the University of Tennessee and still end up with a faculty job at Harvard.

SPENCER: Based on your publication record?

MATT: Publication record and just the quality of your writing and your thinking. So you have a lot of additional chances. Whereas, as I understand it, in France, they make important decisions when you're still a teenager about whether you're on the academic track. Then you take the entrance exam and that decides whether you go to one of the top universities, to a second-tier university, or to no university at all. The credentials are rigorously hierarchical and it's hard to get onto the fast track once you're off it.

SPENCER: I'm really glad I wasn't judged the rest of my life as a teenager. [laughs]


SPENCER: You're not just a thinker about education, you're also an investor in education. I'm wondering, as an investor in this space, how do you think about what you're looking for?

MATT: My friend launched in 2012, which was also the year of the MOOC. So potential limited partners and investors in the fund kept asking, "So which are you invested in, Coursera or Udacity?" I would explain that I was somewhat dubious about their theory of how they would make money and also of their pedagogy. I thought there is an essential component in education that involves human beings collaborating and talking to each other. I was less interested in forms of education that tried to automate that out. There is this interesting component to MOOCs where people at a large scale can chat on discussion boards and there are people who have encouraged collaboration within their classes. But on the whole, the idea is that the teacher is replaced by a series of videos of a teacher, by PDFs and quizzes or you submit code and compile it. I guess you could say that 2020 was the year of Zoom, as opposed to the year of the MOOC. Suddenly everyone on the planet understands the importance of people talking to each other and that that is an important kind of education, too. An awful lot of workplace activity, including things like this discussion, is education. So is the consultative sales process, so is mentoring, so is learning about a new topic as part of your job. Education is an increasing part of what everyone does and a lot of that education involves talking to people while working with them. So the game has caught up with our thesis to some extent. One of the things that we are also looking for is that a company serves a genuinely vulnerable population and that can be people who are poor. It can be people who are cognitively or physically different. It could be people who are persecuted for whatever reason. But we don't want to invest in companies that serve primarily the wealthy and the privileged.

SPENCER: Is that because you want to improve the world or is it because you think it's a better business model or some combination?

MATT: I think that there are business models that are negative for the world, or neutral, or are somewhat positive but widen inequality, that will make money. But education is a heavily regulated and politically sensitive area. So when you do something socially negative, you're taking a risk. For example, there is a company that we looked at, and other education investors were very enthusiastic about it. We realized very swiftly that the main use case for the company's service was cheating so we walked away. We would be, on paper, at least showing a 20x markup on that round which would be great. But it's still possible this company will be a zero in the end. I know for a fact that some of the potential acquirers regard this company as deeply problematic. And can it go public? There are also intellectual property issues. My theory as an impact investor is that one reason why you don't want to invest in, say, a vaping product company is because someone who is taking advantage of teenagers in his primary job function cannot be trusted not to turn around and take advantage of investors as well.

SPENCER: That's really interesting, yeah.

MATT: I would also say that to think about doing good in the world, it strikes some people as fuzzy-minded, or concessionary, or likely to damage financial returns. But really, it involves thinking about a broader set of stakeholders on a longer timeframe. That can actually be very good for investment because ultimately, you succeed as an investor when you identify something that is about to change in the world and you get there at a time when that is not a consensus point of view. I can give you an example. I don't know if you followed the controversy at Middlebury back in 2013, over whether they should divest from fossil fuels. There was student activism and the administration and their investment advisor considered it. That particular investment advisor happens to run a pooled portfolio for all of its university clients; they don't customize the portfolio for different universities. It would have been very difficult for them to offer a portfolio to Middlebury that didn't have any fossil fuels companies in it. So the administration basically patted the students on the head and said, "We sympathize deeply with your passion for saving the planet but we would be making financial concessions and shrinking the efficient frontier, and not making the optimal investments to pay for education, all the wonderful educational things we do including scholarships for you. So we're going to continue investing in fossil fuel companies." Then in 2019, they decided that in fact, they were going to divest from fossil fuels in a deliberate and measured way over the course of 15 years. Then the pandemic happened, and a process that had already been underway accelerated. Coal, to name one important constituent of those indices, Dow Jones coal index had been as high as, I think, 600 and then went to under five last year. I think that oil and natural gas are probably going to follow the same pathway. There is, in fact, this inexorable growth of renewables that is based on mathematical laws — if I can say that to a mathematician — that there's an equivalent to Moore's law, the law that says that computing power tends to double every two years, which isn't really a law; it's just an observation about the pace of progress. The equivalent in renewables — solar panels, for example — every time global manufacturing capacity as measured in kilowatt hours doubles, the cost goes down by 20% and that has proceeded much faster than anyone anticipated. Actually, let me ask you this, can you guess between 2002 and 2012, how much global solar panel manufacturing capacity increased?

SPENCER: Maybe 10 times?

MATT: 1200 times.

SPENCER: Oh, my gosh. Not even close. [laughs]

MATT: So the cost went way down, and it continues to go down. Technology for extracting and using fossil fuels also continues to improve but the resources get harder and harder to extract. Basically they're running on a treadmill and they have to run faster and faster just to stay in place. Whereas, with renewables, the cost keeps going down. So in many parts of the world, it's not even worth digging coal up out of the ground and transporting it to an existing coal power plant and that's going to happen to the rest of the fossil fuel industry, too. We'll just be using the fossil fuels for plastics. That's a mathematical inevitability and the students were right. To the extent that the Middlebury administration did not listen to them back in 2013, they lost a fair amount of money. So that's an example of taking a longer view and thinking about a broader set of constituencies leading to better investment decision making.

SPENCER: I think you're pointing to an empirical factor, or you're saying it's a fact that impact investing is correlated with good investing in terms of making good returns. But surely this isn't always the case, right? Surely, there must be times when, in terms of just pure financial returns, you're better off investing in something that's bad for the world. I would argue in those cases, you still shouldn't do it because it's much better to live a life where you're actually trying to improve the world. But am I characterizing your view properly?

MATT: Yes, but there are a lot of people who have houses in the Hamptons or even yachts that were bought with investments in general. It was a very successful investment. Although in the end, I think that to date, investors may have lost more money than they've gained on average, in total. Mostly the later stage investors who've lost money because of the regulatory problems. So it can catch up with you, you're writing a put where you're taking an extra layer of risk. Unquestionably, methamphetamine is inexpensive to create and extremely profitable to sell but there's a high risk. There are businesses that are bad for you or bad for someone, that are profitable. Although I would say they have an extra level of risk associated with them. There are a couple of things that we turned down within the education sector because they didn't meet our criteria, that have gone on to enormous success. In some cases, they were basically positive for people, but they were positive mostly for wealthy people and were widening rather than narrowing the gap.

SPENCER: I think what you're saying is that it's not that unethical investments would necessarily lose money but there is this extra risk from the fact that they're unethical. I completely agree with that. But I just think, even in cases where you could make money doing the unethical thing, it's just so much better to live a life where you're focused on all the wonderful opportunities where you can make the world better. I do think that those tend to have an advantage like you're suggesting. The things that actually make the world better actually produce value and have an inherent advantage because they're providing something that people want and the other people don't want to block or much less likely to want to block.

MATT: Well, there's another factor, too. If you think about those Middlebury students. Let's say, there are two tech startups that are competing for the top talent from Middlebury or Stanford or other universities. The two companies are equal in financial terms but one of them is somewhat socially negative and the other one has a strong, compelling, positive social mission. The one with a strong social mission is going to win the war for talent every time, and I can point to lots of examples of people who have been willing to take 8% pay cuts in order to join a startup with a compelling social mission. I also think people just work harder when they believe in something and they experience less regulatory and political pushback, less pushback from journalists. I think it's certainly possible to make enormous amounts of money with something that's socially negative. But with respect to venture capitalism asset class in particular, I think something that is compelling to the best talent definitely has a bit of an edge. Then the biggest single mistake that venture capitalists make — the biggest single killer of companies — is building something that doesn't matter, that nobody is willing to pay for, that nobody cares about, doesn't solve a real problem. Some people call this failure of product market fit. But in impact investing terms I sometimes think of it as a failure of empathy. You didn't know who your customer is. You didn't identify a really urgent problem in their lives. As an impact investor, I make a lot of mistakes, and some of them I make repeatedly. One of those mistakes is investing in something that nobody else thinks is a good idea. Then a year later, nobody thinks it's a good idea still, and it's hard to round up additional money for it and I need to find investors other than my firm. That's a mistake that I made. But the one mistake that I tend never to make is investing in a company that isn't trying to solve a real problem. Because as an impact investor, I'm not just asking, "Is this an opportunity to make money?" I'm asking, "Is there real human suffering here? Is there a loss of human potential?" So there's something real for the company to do and it's a job that is not getting done by other companies very well so that is also a useful criterion.

SPENCER: I completely agree with everything you're saying. One wonderful way to avoid doing something trivial is to say, "What is truly valuable to people?" Then let's try to produce that value and maybe we'll fail to produce it. If we do produce it, we know that there's going to be someone who's gonna get a benefit. Therefore, there are probably some people that are willing to pay for it, either in a for-profit enterprise, you charge the customer money, or at a nonprofit enterprise, you're gonna get someone else to fund this creation of this value. I also totally agree with a lot of the side benefits of doing something that matters such as, it's easier to recruit people, it's easier to get positive press, it's easier to stay motivated yourself and not give up because just trying to make money for yourself is actually not a very compelling motivation to wake up for day to day, people are often willing to take pay cuts, and so on. I'm totally in agreement with you.

MATT: What you said about CEO motivations is something that I perhaps should have mentioned, too. CEOs of social impact companies behave differently. Let's say that you want to solve a particular problem related to the teaching of writing. It's a problem that you know intimately. You've been irritated by it for years. You created a set of resources for your own classroom and then other people started using it. Then you decided to start a company. You're not going to quit or sell the company when times get hard in the way that someone else might. You're not just looking for the swiftest path to being a billionaire, wearing a hoodie, and having a private island. You're solving this problem because you want to solve this particular problem. You know that nobody else is going to give you a chance to solve it in the way that you think it needs to be solved. This is an expression of who you are.

SPENCER: Absolutely.


SPENCER: Stepping back for a second, we've talked a lot about different ways the education system can be improved. I'd love to hear your thoughts about why there's a greater stake in all of this about society and democracy itself?

MATT: Well, I think we've seen over the last five years that American democracy has a bit of a problem. There are skills that a lot of Americans don't have that they need in order to be useful to their nation and even to be safe to be around. As it happens, I think that a lot of those are also skills that are useful in the workplace. I would mention, for example, statistical literacy. There are a lot of discussions about the virus and vaccines and wearing masks that reflect a real statistical illiteracy. There is also a problem with a lack of awareness of what makes an argument strong and how to analyze an argument and how to construct an argument. I think that teaching debate in the schools would be incredibly useful. I think of debate as the first step towards empathy. There probably are some people who are completely incapable of empathy no matter what training you give them. But they can at least learn to hypothesize about what it is that other people are thinking, feeling, or valuing. If you're a good debater, you don't just construct your argument. You think, "What is my opponent going to say in response to this argument? What arguments are they going to make?" Then you think of responses to the arguments that they're making but you have to think your way into their shoes, at the very least.

SPENCER: I think these are wonderful topics. These are actually a number of topics we address in our website Clearer Thinking. We actually have one program called, "Can you detect weak arguments?" where it gives you a series of arguments and you have to rate the strength of them. Then we give you some feedback on your ratings and how well you can identify the stronger ones and the weaker ones. We hear a lot about (quote) 'critical thinking.' Do you feel that a lot of what's talked about there is actually hitting the mark? Because my sense is that it's not. I'm not exactly sure why, though. But it feels like a lot of it is not the thing that, at least, I think is important. So I'm curious to hear your perspective.

MATT: People use the phrase 'critical thinking' a lot of the time when they can't articulate what they're actually trying to teach. I think there are two organizations that have done particularly useful thinking about all of the myriad different types of critical thinking that one ought to master in the course of K-12 and college education. One of those is the Minerva Project, the highly selective online university started by Ben Nelson which has been extremely deliberate in thinking through what skills a college graduate ought to master. They've identified several hundred core concepts and habits of thought that they think ought to be at one's fingertips, and not just in the context of one discipline but generalizable across everything one encounters. There are a number of those from statistics but there is also some rhetoric, thinking about who the audience you're addressing is and what they believe. They include a little bit of music theory, part of the curriculum for millennia, but definitely not part of it today, not viewed as a core skill. They identified hundreds of key concepts and habits of thought. Some of the extremely brilliant students they create find it a little bit mechanical and patronizing at first to identify them, basically to label them when everyone encounters them. But after a while, they start to appreciate it as all of them become second nature. Then they go on to do a lot of brilliantly original project-based work, some of it scientifically or socially quite significant for their third and fourth years. They also live in a different global city each year. The other institution that I think has sent some really brilliant thinking about what kind of thinking we want a college graduate in particular to be able to do, is the Lumina Foundation. They had a goal that two-thirds of all Americans would have a college degree or other quality credential by year 2025. Then they started thinking in a very serious way about what they meant by a quality credential or a quality degree. I'll give you just a subset of that that I find particularly interesting. They said that, when you are in a four-year or bachelor's degree program, you ought to do a capstone project within your major where you do original work. You ought to use materials from at least one other language besides your native language or your first language. You ought to demonstrate that you understand the history of your discipline and the current debates within your discipline, and the arguments on both sides of those debates, not just your professor's argument. But the most interesting part of all was that they said, you ought to use the methods of at least one other discipline alongside the methods of your discipline and demonstrate the strengths and limitations of each discipline's methods. Now, someone who masters that kind of thinking is going to be incredibly valuable in the 21st century workplace, regardless of whether the degree is in art history, women's studies, or applied math.

SPENCER: I like that because in my own experience when I try to solve problems in the world, I often find that they quickly spill outside of traditional boundaries, like, "Oh, this is not just an applied math problem. It turns out you need some computer science." Or "this is not just a computer science problem. Turns out you need some psychology," or what have you, just feeling like you're bucketed within one academic discipline, which I think is actually really bad for trying to solve problems in the real world.

MATT: Absolutely. When people say critical thinking — "Students learn critical thinking within my discipline" — I had this experience a lot in graduate school when I did a PhD in English literature, as well as a BA and MA. I was a very curious, as well as a very politically unsavvy, person. We'd be talking about ideas that are often very close to the professor in the questions part, like the questions they'd written their last book about. I remember one case where a professor was talking about spaces of American literature and the idea that certain kinds of literary work, literary genres could be produced only within certain cultural spaces. So Henry James, within the cultural space of The Atlantic magazine and — can't remember his publisher, Houghton Mifflin or whatever it was — could write novels that demanded the kind of attention that hitherto had only been given to scripture and occasionally to poetry. Whereas, if you were a woman, you would be writing domestic fiction for a different audience. If you were a former slave, people would be eager to read your slave narrative but they wouldn't want you to write a Henry James type novel or to publish a story in The Atlantic. So people were constrained by the social position and social space that they inhabited. I had a couple of questions, and one of them was, "Are these distinctively American spaces? Because Henry James spent some crucial time in France at places like the salon of Flaubert. Didn't that have something to do with his conception of what writing could be and what kind of attention you could demand for your writing?" This particular professor was profoundly uninterested in exploring this question and really shut it down in a fairly aggressive way. A lot of my favorite experiences in graduate school were in a symposium series with external professors who would come in. They would send us two papers that they were working on and we would read them before the discussions. Then we'd have a two-hour discussion of each where everything was on the table and we could ask them those questions about their fundamental assumptions and their theories. We could pressure test them and they wanted us to. They wanted to make the papers stronger. That was really valuable. I also often think about two of my grad school classmates in different disciplines, I think maybe political science and economics. They're not even at the dissertation stage but they ended up chatting with a famous history professor, Paul Kennedy. They ended up collaborating on an article on what they ended up calling "Pivotal States," and they published this article in Foreign Affairs and it becomes a bit of a sensation. So you have these people who are still early in graduate school, getting invited to keynote at conferences, actually getting paid to show up at the conferences, and their career is on a whole different track after that. But also think about the experience of writing this paper with this Pulitzer Prize winning historian and learning about his methods. Getting invited into his workshop is priceless, probably a lot better than just writing a PhD under the supervision of a professor within one's own discipline. We need more of that at the graduate level and less of the traditional PhD, I think.

SPENCER: One final topic I wanted to get your thoughts on is about prejudice, privilege, and topics like these. I'm curious, do you feel that these should be addressed in, let's say, high school or middle school level? If so, in what ways?

MATT: It's hard to address them. Sometimes when you address them, you provoke a kind of backlash. People get hardened in their racism but they have to be addressed. You cannot not work with people's aggressive and dehumanizing biases. I have a relative who is a middle school teacher and she was asking students about what they wanted to do when they grow up. One of them said, "I want to kill all the Jews." You can't not respond to that in class. How do you respond to it? How do you do it in a way that is not savaging the kid? How do you do it in a way that doesn't get the parent trying to fire you? Do you need to send Child Protective Services to that kid's home? It's a complex set of questions but you have to respond. People have to. You could say that the question of how people get along — this returns to that question about democracy, too — ought to be one of the most central questions that are addressed in school. On a humbler level, I think that even a question like who gets to speak and how, and training people not to interrupt each other, that would be incredibly valuable. Like, why is there no class on how to participate in a class or in a seminar or in some other kind of discussion?

SPENCER: I guess some people would argue that you learn that through osmosis through watching the behavior of others. What would you hope would be taught in the class if it was taught more explicitly?

MATT: Well, I think you do learn it through osmosis. If you're, just hypothetically, a tall White man with a PhD from Yale and a reasonable amount of money, you get taught one set of lessons. If you're anyone else, you get taught a different set of lessons. They get used to it. They may not even notice it. But I think it's important to make people self-aware of how they are participating and possibly even giving them the actual facts. There's a fascinating app out there for teachers, actually two different companies have apps like this, that listen to the class discussion. Afterwards, they tell the teacher, "You were talking for 17% of class time. You asked 35 questions. Out of those questions, 30 of them were open-ended and the others were closed-ended."

SPENCER: That's really interesting.

MATT: If you do it on Zoom, you can go further and say, "This student..." You can even do it during the class. In fact, the Minerva Project, the highly selective online for-profit university that I mentioned before, has tools that will alert the teacher who has not been speaking and who has been speaking too much.

SPENCER: That's great.

MATT: You can do that in other ways, too. Whom you are responding to? How are you responding to them? The practice of democracy in the classroom or civic engagement on some level ought to be a very central topic. I would say, a lot of people think of schools as preparing people for work and that it's a reasonably important thing to do. In this country especially, you can't just get by on universal basic income or welfare. If you don't try to make a living and you're not wealthy, you're gonna have a very bad life. But maybe the most fundamental goal ought to be to prevent civil war or genocide. What do we have to do to make sure that that is not a possibility? I think that learning to respect people who are different from one and learning how to treat them well is a very central topic. It's potentially a very rich and intellectually interesting one, too.

SPENCER: Matt, this is super interesting. Thank you so much for coming on today.

MATT: Thank you for having me.





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