Translating a Free Online Education into a College Diploma

Photo: wohnai

Over the last couple years an exciting new trend has emerged amongst universities across the country – they are providing courses online for free! Harvard, Yale, Stanford, MIT, UC Berkeley, Columbia, UCLA, and John Hopkins are just some of the schools that have lecture videos of entire courses online.

Why the heck are these schools doing this?
It is the free information movement. Just like there was a free love movement in the 1970’s, there is a similar free knowledge movement in the early part of the new century. Wikipedia is the epitome – its free information has become a part of the way we research just about everything. Another manifestation of this is the huge open source software movement providing free software to the masses. Examples are the Linux operating system, Mozilla Firefox web browser, and Android phone operating system. It is a cultural and economic phenomenon that deserves much more attention than a few sentences, but there is not room in this post so I will refrain – just be sure to take advantage of it!

What exactly are they offering?
It varies widely from school to school and even class to class. The organization OpenCourseWare currently has 200 schools with 13,000 courses offered online – some just have the lecture videos, while others also have the assignments and exams complete with solutions. Beyond what is posted you are on your own – there are no help resources such as teacher assistants or other class members to contact.

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Salary – When Minimum is Greater Than Maximum

Photo: David D. Muir

Most people think the benefit of attending a top tier school is the ability to nab a high paying job – investment banking, consulting, CEO, etc. Sure those opportunities are great, but I am going to argue that the real advantage is the ability to pursue work that the individual finds interesting. Right now you are probably thinking – can’t anyone do that? Yes, but a top tier degree enables you to do it without worrying about money – you have a great degree to fall back on if things don’t work out. It’s not the maximum salary opportunities that matter, but rather the high minimum salary that can be expected with a degree from an elite university.

The focus of students at these schools is not merely passing versus failing – all the students admitted to top tier schools are capable of doing the work, in fact thousands of capable students are rejected every year. Keeping this in mind, these students are going to have a focus other than passing and failing: grades, social life, sports, clubs, job, girls, etc. I won’t go into what their focus should be in the post, only what they should do in the meantime – get a technical degree! Not all college diplomas are equal, even if they do come from the same school. Graduating with a technical degree will prove valuable later when it comes to your career.

Many college students make the mistake of choosing a major because it is easy and they will be able to get a higher GPA while working less. A technical major is much more important for job demand than GPA. In fact, leave GPA out of the consideration – after your first job, who cares? The answer is graduate schools, but that is not a job. Who is going to have a harder time quickly finding a job, someone with a aerospace engineering degree and a 3.1 GPA or someone with a classics degree and a 3.4 GPA? These majors may be harder but it is well worth a sacrifice of a couple tenths off your GPA in exchange for job demand.

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An Alternative to Traditional Venture Funding

Photo: Wally Gobetz

Yesterday I explained the pitfalls of too much venture funding. Whenever posting about a problem I will always attempt to follow up the next day with a potential solution. My idea is a Venture Capital funded bank account to be used by the startup where every X dollars spent translates into a percentage point of equity. The beauty in this model is that the startup receives the funding they need, but are incentivized to keeps their costs under control and become profitable in a hurry.

Let’s imagine a fictitious hot new internet startup looking for series B funding to take them to the next level. The offer they receive from KPCB is $10 million in exchange for a 40% in the company. Sounds great right: a ton of money from one of the best venture firms at what the founders feel is a generous valuation. Wrong! Take that same valuation but avoid the trap of taking more money than you need. Here is a potential counter offer:

  • $2 million immediately for an 8% stake
    • This amount will certainly be needed before becoming profitable.
  • The VC firm opens a bank account / line of credit for up to $8 million more where every $25k is 0.1% of equity
    • Forces the startup to watch their expenses rather than quickly burning through money without consequences
    • Protects startup from equity dilution (an excellent explanation) by only granting equity to the VC for funding used

If things start to go downhill for the startup there must be some protection from the VCs simply closing the account. Here are some potential rules:
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How Would You Like Continuous Direct Deposit for Your Paycheck?

Photo: Andrew Magill

I receive a monthly paycheck. No I’m not bragging, quite the opposite, I am complaining. This sounds great to those who are unemployed, but why do I have to wait an entire month before being payed? The work that I do on March 1st I will not actually receive any compensation for until April 1st, 31 days later. To put it another way, 0.1% of my life later. Now does it seem like a bigger deal? I would much rather have the instant gratification of immediately receiving the wages of my hard day’s work.

Before big corporations came about I imagine everyone got paid at the end of the day. Today we sign agreements to give the company the right to only pay us once a week, bi-weekly, or even monthly regardless of whether you are paid by the hour or on salary. And of course there is no interest paid even though they are holding what is rightfully your money. My solution I call continuous direct deposit.

In the workplace money is never physically handed to the employee by their boss, it is all done by either check or direct deposit. Direct deposit allows for the transferring of funds from one bank account to another without dealing with cash or checks. Continuous direct deposit would transfer money from the employer’s bank account to the employee’s at infinitesimally short time periods — time periods that would make my monthly paycheck look like an eternity. Anyone with a salaried position can determine how much money they make any given minute, second, or even millisecond. This can be boiled down into an equation to be used to continuously deposit your paycheck into your account.

In theory you should be able to head to your bank’s website, repetitiously hit refresh, and watch you balance slowly tick up. Altering the equation could ensure that money is only deposited weekdays or during work hours.

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