(2021-03-25) Mccormick Whats On Deck For On Deck

Packy McCormick: What's On Deck for On Deck? Today, On Deck is announcing that it’s raising a $20 million Series A led by Keith Rabois at Founders Fund.

I’m thrilled that Not Boring is able to invest alongside that crew to help support the creation of a modern educational institution for the future of work. I’m particularly excited about this one as an On Deck alum and someone who once tried (and failed) to do a fraction of what On Deck is doing.

Before Not Boring was a newsletter, it was Not Boring Club, an idea I had for a mashup of social club and continuing education

To validate the opportunity, I did what I do to think through something: write. In July 2019, I wrote Why There Isn’t a Dominant Aggregator in Online Education. The numbers backed up the need for new (continuing) education models: Education is one of only two of the top 10 consumer spending categories (at 2% of total consumer spend) not owned by an Aggregator.

Good enough for me. When it was time to leave Breather and really go for it, I decided to do what an increasing number of founders do: apply to On Deck.

Turns out, On Deck was a lot of the things I was looking to build: education, community, network, friendships, and career opportunities

Then the pandemic hit. After briefly trying to bring the Not Boring Club online, I threw in the towel. On Deck, which had previously been entirely in-person, went the other way and stepped on the gas

On Deck Investment Thesis

On Deck is dramatically reimagining continuing education (Lifelong Learning) by breaking it into smaller atomic units, each of which feed off of each other to create a better customer experience, strong Lifetime Value, and deep moats that will protect its high price point and margins over time.

all roll up into a broader On Deck ecosystem. Each new program feeds into the others, providing “supply” for a “demand” the team has identified in existing programs. For example, On Deck Angels supplies capital to On Deck Founders, while Founders reciprocate with access to exclusive dealflow.

On Deck doesn’t make programs, it makes organizations that make programs

One of the challenges with both community and top-tier education is that it’s really hard to scale. There’s something called “evaporative cooling,” which is when the quality of the people and interactions in a community decreases as more people join. On Deck has one of the most credible approaches to solving this challenge of any I’ve seen... By adding new verticals instead of making the Founders Fellowship really, really big, On Deck has built a group of small, intimate communities that roll up into one large, On Deck community. Each fellowship it adds reinforces the others. (fractal ecosystem)

On Deck is an education business with software margins

The challenge, as I wrote in 2019, is that education isn’t well-suited to aggregation.

In the piece, I suggested that since education isn’t well suited to aggregation, the Natively Integrated approach was the right one to take.

This is exactly the approach that On Deck is taking to education.

On Deck doesn’t hire teachers or university administrators. Instead, it’s built a team of strong tech operators and investors to lead the company

On Deck Founder & Chairman Erik Torenberg is a seasoned community builder. He was on the founding team at Product Hunt

A big part of the magic is who On Deck taps to run new programs. There are two sources: internal and external.

This is a risk for On Deck, too. By putting the individuals who run On Deck front and center, it increases the surface area for good things and bad things.

If you take one thing away from this piece, it’s this: On Deck is building a platform on top of which it can plug in any person, program, or product related to helping people get smarter, make connections, find jobs, or create.