Tuesday, October 14, 2025 - Parents and prospective students want to know how colleges are responding to the rise of generative AI — and to other recent developments like federal budget cuts to research. On this episode, Jeff and Michael share what they’re both hearing as they visit campuses around the country this fall. And they offer their analysis of what AI could mean for higher education, and whether the time is ripe for new entrants to enter the college landscape. This episode is made with support from Ascendium Education Group.
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Joshua Rothman in The New Yorker
Student Loan Debt Is Strangling Gen X
Oyin Adedoyin in The Wall Street Journal
Charlie Javice sentenced to 7 years in prison for $175M fraud
ABC News
Anthology Declares Bankruptcy, Blackboard to Remain as the Core,
Phil Hill, in OnEdTech
0:00 - Intro
2:23 - What Jeff Is Hearing On His Book Tour for ‘Dream School’
4:25 - Should College Get Harder Because of AI?
7:27 - Why Different Kinds of Colleges Will Be Impacted Differently
10:48 - Startup Universities Are Emerging With an AI Focus
14:25 - Redesigning the College Experience Around Activities and Personal Development
17:39 - Will a New Kind of Expertise Be Required On Campuses?
19:20 - Will Employers Trust Degrees In the AI Era?
24:40 - Sponsor Break
25:35 - How Student Loan Debt Is Impacting Gen X
28:22 - A Republican Effort to Question Consultants That Help Set College Prices
30:15 - Charlie Javice Sentenced In Fraud Case
31:44 - Anthology, Owner of Blackboard LMS, Goes Bankrupt
34:00 - Some Trade Schools Exempted From New Federal Rules
35:00 - Making Changes at Colleges Stick
Michael Horn
Jeff, it is good to see you actually in a chair in your house in the place where you normally record this podcast because I know you have been on the road nearly nonstop this fall since your book came out.
Jeff Selingo
Yeah, Michael. This last month has been kind of like a year, but I've learned so much in the questions that parents, students, and counselors are asking me on the road. So it's gonna be good to catch up with you on this episode of Future U.
Sponsor
Future U is sponsored by Ascendium, a mission-driven nonprofit committed to improving learning and training systems to better serve learners from low-income backgrounds. For more information, visit ascendiumphilanthropy.org. Subscribe to Future U wherever you get your podcasts. And if you enjoy the show, share it with your friends so others can discover the conversations we're having about higher education.
Jeff Selingo
I'm Jeff Selingo.
Michael Horn
And I'm Michael Horn.
Jeff, we've been on our own mini tour of sorts, if you will, this fall with Future U tour stop at Butler University and Adobe's Edumax conference in the Bay Area. But you've also been out quite a bit. It's actually been hard to keep track of you crisscrossing the country in different states all over and getting out of your comfort zone in terms of the geographies perhaps, but spending time I know where you love spending time with actual students, high school counselors, learning from them, and parents.
I'm curious, given all that's happening in higher ed right now. Like you said in the intro, it feels like a year to you in just a month, but I think it feels like a decade to some administrators over the last 12 months.
Jeff Selingo
That's true.
Michael Horn
What's on the minds of families and the counselors who advise them, and how are they absorbing all these headlines around higher ed?
Jeff Selingo
Yeah. There is a little bit of a disconnect.
So I've been in San Francisco, Denver, New York City, in the suburbs of Washington DC. So, you know, all big metropolitan areas so far in this book tour, also Toronto. So we have a little bit of the Canadian representation there as well.
And what I'm hearing, first of all, is that there's the usual questions that I would have gotten two, three, four, five, six years ago about the SAT and about transcripts and things like that. So there's a little bit of a disconnect given the moment that we're living in right now in higher ed.
But at every single stop, there will be questions around what is the impact of research spending on undergraduate education? What is the impact of the Trump administration and its crackdown on campus protests in colleges? You know, what's the impact going to be on higher education?
The other big one that I get, Michael, really surrounds AI. We're gonna be talking more about that this season, of course, on Future U. But, really, what is the future of college?
And I think some of this is framed on what's going on in DC. Right? There's this big compact that just came out. The Trump administration sent it to nine institutions. It's a proposal to reform campus operations from reducing the number of international students to requiring standardized tests. And if they sign this compact, again, these nine colleges and universities that got it, they'll get preferential access to federal funds.
So at the time of recording, we don't have anyone that actually signed it. But again, there's, you know, stuff about what's going on in DC is clearly on people's minds when they ask about the future of college.
I think some of it is also around the declining confidence in higher ed overall. And is this worth spending money on? You know, clearly, affordability keeps cropping up in these conversations. They wanna know more about merit aid. They wanna know more about financial aid in general.
But, of course, I think a lot of this is really driven by AI. And, you know, in the middle of this tour, there landed this fascinating piece in The New Yorker that we'll link to in the show notes, Michael, that I sent to you, which is ‘Should College Get Harder’ was the headline. And it really argues some of the things that we've been talking about here: that AI threatens to reshape knowledge work and that college has become drastically easier even as what we're going to require people to do in the future with AI is actually going to be harder. Right?
And so the author of this piece talks about, you know, professors prioritizing research over instruction. Grade inflation has soared. Students study half as much as they did decades ago. Students are really there for internships and extracurricular activities to really distinguish themselves because grades no longer do that. And their argument was that AI compounds these problems because now students can use chatbots to fake learning, and so forth.
And so it really reminds me, Michael, of this dinner conversation I had with university leaders in Texas just a couple months ago. And the conversation at dinner was, well, if AI could develop and teach a course, and if AI can take a course, both of which, by the way, have happened. What's the purpose of the university at the end of the day?
Michael Horn
Yeah. It's a good question.
By the way, it's interesting to me. I've been on a couple campuses over the fall. In Wichita State, one of our listeners actually there was asking a lot of questions around grade inflation and some of the artificial intelligence and sort of the competing supply and demand pressures, if you will, right, on universities for more rigor from companies, if you will, but less rigor perhaps from the students and given habits and things of that nature.
And when you sent the New Yorker article, I was reflecting on — and I'm curious about your take — but I was reflecting on that I felt like it described my college experience quite a bit, actually, with my extracurriculars being the priority in some ways and less my classes.
Maybe as a communications major at Ithaca, you had a different experience.
But put that aside for a moment. When I think about the purpose, though, of a college or university in the age of AI, the first thing I think about is we really have to be careful — even more so, I think, than in the past — to talk about what segment of higher ed we're talking about. And I'm curious your take on that. But, you know, the Dartmouth president, she had a piece in The Atlantic on this question and said this knowledge view of just knowledge dispensation, if you will, of the university is a very overly simplistic view of what a university or college does, has done, and so forth that colleges and universities are much more complex. They do lots of different things.
And as I was reading it, I was just thinking, yeah, we have to pull out I think the college or university that's very obsessed with training to get the job or get the promotion — sort of the online players, community colleges maybe and things of that nature — versus perhaps the idyllic experience. I will give you my answer, but I'm just curious. What's your reaction to that?
What segment should we talk about?
Jeff Selingo
Well, exactly. I mean, universities obviously do many different things, and there is definitely the training part of it, which I think AI might clip first because it's easy to design an AI-driven course where literally you're just being trained to do something.
But I would also argue, and, you know, most of the university officials around the table with me in Texas were mostly R1 research universities, regional publics, some privates mixed in there as well, but also at the research level, is that I think that, you know, we've talked a lot about this on the show about teaching and learning still remains at some places, you know, woefully inadequate.
Michael Horn
Good point.
Jeff Selingo
You know, I talked with Corbin Campbell who's written a book on college teaching. She's a professor at American University. She's quoted in my new book, and she's done a lot of studies at most selective colleges, less selective colleges, liberal arts colleges, which by the way are supposed to be focused on undergraduate teaching. And she says they do the best, but still, most professors were never trained in teaching. Many teach the same way they were taught, and many teach the same way they've taught for 20 years.
And so if all they're doing is delivering knowledge, essentially, through the lecture, and even if they're using, you know, other types of flipped classrooms that, you know, were hot, it seems like maybe 10 years ago, I'm still wondering, though, whether they are ready for the age of AI where students not only could do most of the work, through AI, but wanna be engaged in different ways, Michael.
And you've seen the same surveys that I have seen where students feel ill-prepared for a workforce driven by AI. They want to learn more. They think their faculty are really behind on it.
And so does this almost take a pause for colleges and universities to figure out what their strategy should be? I feel like the first couple of years of AI, colleges and universities were like, 'Ok, we're gonna crack down.' Now they're like, 'Ok, we have to accept this.' But it still seems like course level or school level. I feel like with maybe the exception of Ohio State, I still don't quite know what it means for AI throughout the curriculum there.
Michael Horn
Right.
Jeff Selingo
But it seems to me that colleges and universities need to step back, have a real focus on this for maybe the next year or so to say, 'Here's what we need to do about this.'
And one of my concerns, to be honest with you about all that's happening in Washington right now, is that it distracts college leaders from kind of doing their jobs for the most part because they're always addressing the next issue and the next crisis. And so nobody's gonna say, 'You know what? We're really gonna take a deep dive on AI for the next year and try to figure out how our teaching and learning should change.'
[Michael Horn] (00:00:09,360 - 00:13:15,745)
Well, I think that's what's interesting right now is some of the startup universities being built around an AI core. You know, Matter and Space by our friend Paul LeBlanc. Right? You’ve got New State University, Sasha Thackenberry. Some ex-Duolingo employers excuse me, employees, I think tentatively called Outsmart or something like that. These AI-native universities, I think, may put that question at the fore. And I think as much with higher ed, you know, I think part of the challenge like we've seen in the Trump tug-of-war, I agree it's distracting leaders from this question, and leaders have a very difficult time penetrating into the academic core at a lot of these places, right, to actually rethink the teaching and learning. And so that's part of it. And let's address maybe that segment and leave aside some of the more training-focused colleges and universities, if you will, And just say, I think that faculty-centered college and university experience, to me, AI doesn't replace the need for it.
Like, the number of autodidact learners is very small in the world. Yes. It's incredible to do just-in-time learning, by having a conversation, with ChatGPT or Gemini or, you know, whatever. I'm using it all the time for that purpose when there's like an area of casual interest that comes up and I want to quickly dive deep and learn something about it. And foundational knowledge learning, place to create connections, place to explore with deeper experiences, the extracurriculars that I think are actually extremely valuable in figuring out what you want to go do, and the things that energize you, and that colleges and universities should probably be leaning more in on to make it an intentional part of the experience that every single student is graduating with real experience where they're actually using AI in the context of that, and then reflecting on purpose to understand, ‘What does it mean about me as an individual?' Like, 'Where do I wanna lean in?'
This seems to me, Jeff, like an actually centering opportunity for the college and university to become more relevant and more tied to what I think students really need and they might wanna do, but it forces a recognition that the job to be done is not actually the classes themselves.
Jeff Selingo
Well, and that leads us, I think, to a very good point, Michael. I was just actually wondering when you would get to the ‘job to be done’ here. Because it was brought up in this New Yorker piece. You know, has college just essentially become a personal development retreat as they put it. I'll put retreat in quotes. Quotes. Yes. Sounds kind of nice to me. Right? Maybe the lazy rivers will actually serve a purpose at that point.
But this idea that we know ... For example, we know that students are completely have been less disengaged or more disengaged after the pandemic. We know the work of Anxious Generation and Jonathan Haidt around concerns about, are students ready for the workplace and college in general? Right? The whole social-emotional aspect of colleges. Right? And we also know that work and work-based learning is more critical than ever before.
And I brought this up before. You know Randy Bass at Georgetown has talked about the two cultures problem in higher ed used to be between the humanities and sciences. He now believes it's between academic learning and experiential learning.
Michael Horn
Yeah.
Jeff Selingo
So if we kind of redesign the college experience around this personal development retreat — however you feel about that word retreat. But let's focus on the personal development piece of this, where we are focused on helping students with those problem-solving skills, with the ability to work with other people and work in teams, you know, the kind of creating, and finding similarities among differences and helping them navigate those differences, helping them navigate ambiguity, helping them get that hands-on learning so that the academic piece of this does become a lot less.
And by the way, the academic piece could essentially be replaced in some ways by AI.
It actually sounds, as I say this, 'Hey. That could potentially work.' The question now is we have all this infrastructure that was built for classic academic learning, not only academic buildings, but we have all these tenured professors. So what do we do with all of them?
Michael Horn
Yeah. Well, I'm getting really excited about your vision. I will say that.
And I think the knowledge experts are still useful in terms of guiding those questions and helping create those connections. And can you imagine the professor who is, you know, with a company, say, actually helping them solve the pressing problem with the frontier of academic research on stuff like it's real time case studies as opposed to the book I wrote, you know, however many years ago that I still teach. Can you imagine what that would start to do both to, professors' research being more topical and in demand and then a connection to students actually being able to practice at the forefront of that on real projects?
I guess I say, like, yeah, it's a massive shift, but it's not obvious to me that it means less expertise or less faculty per se. It does mean a very different set of things that they would be doing.
I got a question recently just before we recorded this. I was with some Minerva University faculty and one of them said, ‘You know, if the major came from Johns Hopkins, but it was really an excuse to help train people for academic disciplines.’ And so my overlay on that would be there's something therefore inherently vocational actually about majors for the academy's purpose. Right? Not for outside the academy, but in terms of like my history major was to prepare me to think like a history PhD at some level.
You know, if we walk outside of the major structure and outside of the departmental structure, which is a huge shift as well, but more problems of practice and societal and things like that's much more interdisciplinary by nature, then you can almost sort of squint and start to see the future that you're talking about, but those are huge change initiatives that we know from history are gonna be more likely to come from new entrants, if you will, into this college and university space, and then hopefully some places will be able to reengineer around them. I would think places like Northeastern would have a leg up given the co-op system and stuff like that.
Jeff Selingo
Yeah. Michael, but I'm also wondering if it might ... And I wanna get into jobs in a second, to round this conversation out ... But I'm also wondering if it might require a different type of expertise on campuses.
James Devaney, who we both know at the University of Michigan, who heads up their innovation efforts there, told me recently for a paper that I did as part of the continuation of the series that we started on culture change — that we started on culture change at universities — told me that faculty are going to have to get used to that the experts might come on the staff and administrative side, especially around AI.
And so, you know, often at our colleges and universities, we've thought of the faculty as the experts and all, you know, as a font of knowledge and everything flowed from them. And now as, especially as these innovation areas of campuses start to take off, whether that's, you know, the Red House at Georgetown or EdPlus at ASU or James Devaney's shop at at Michigan, they're bringing in all these other experts from, you know, usually outside of academia who can help faculty, you know, redesign these courses, for example.
But that does require a couple of things. It requires faculty to think differently about who's going to advise them on how they teach their classes and things like that. But as I was talking to James, I just kept also adding up all the cost of this.
Michael Horn
Yeah.
Jeff Selingo
This is not necessarily a cost-savings measure if we kind of turn the university in this direction that we're talking about.
And I know both of us, you know, this vision that I just laid out a little bit earlier. You know, I think both of us continue to be worried about just the cost curve in higher ed, and nothing's gonna bend it.
But maybe stop there for a second because I do want before we close out this part of the conversation, I do wanna ask you about two things that did come up in that New Yorker piece and about what employers are going to do. Right?
So are they gonna simply continue to trust the degree, or will they do some testing?
And the other argument in this piece was that maybe STEM degrees, which have always been more rigorous compared to the humanities. Okay. Get ready for all those humanities graduates to send us notes. Is this going to be now a two-tiered system?
But I'm more interested in what do you think employers will do? Do you think employers will just kind of continue to trust the degree? Or if college is getting easier, AI requires us to have a higher level of thinking, different cognitive skills, different social skills. Do you think employers might say, 'We're gonna start testing for that?'
Michael Horn
Yeah. So this gets back to the Andreessen Horowitz podcast. Right? What was that? A year and a half ago at this point that, where they sort of listed all the problems with higher ed, and they made the case that if universities are gonna walk increasingly away from a meritocracy and have grade inflation, and so forth, then employers are gonna look for other signals effectively, whether that's their own testing or stuff like that. Right?
My own take is different. This is where, you know, you mentioned the compact that the Trump folks have put out at the time of this recording, and one of them is hammer down on grade inflation. And my sort of note is, I agree. It's like a huge problem. And if we move to competency-based learning, by the way, everyone would be mastering. So I don't know that, like, the way they framed it actually solves any problems, if you will.
But what I think it does, Jeff, is it forces us to center experiences far more seriously in the university curriculum to get real-world connections with companies where you were both able to show evidence that I can do the job because I've had things where I've been asked to do the tasks on the job. And I've built social capital.
Because this is the other thing that's moving really quickly with companies is these tests aren't super-reliable outside of the most technical jobs because employers aren't really clear on what the skills are at the heart of successful employees. So they're sort of grasping at lots of straws and trying to create lots of hurdles. And what we're seeing in the economy, particularly as AI is now, doing the applications for people applying to jobs, is that there's just a massive increase, you know, 1,000 job applications for an opening compared to say 200 to 300 previously.
Before up to 85% of people were hired by your network. Like, that's how you sort of got the job. I think that becomes even more so.
Jeff Selingo
That's probably gonna become like 99%.
Michael Horn
Right? Because you know what happens? I'm trying to find someone. I get 1,000 applications. Instead, I just call you up, and I'm like, 'Jeff, do you know someone who does this well?' And you're like, 'Talk to these three people.' Boom. Right?
I think experience, it's intermingled with tasks and skills and social capital. And we can argue which one is more important. But fundamentally they're interdependent. And I think being able to show you've done it and create connections, which is the lifeblood of an elite or great college university experience is social connection with alums, with your fellow students, with professors, etc. That becomes even more valuable.
So in some ways, like, I don't love the dichotomy between STEM and humanities because I'm a history major over here believing that the liberal arts are actually about to become more important.
Jeff Selingo
But I liked, Michael, how you corrected yourself by, you know, the alumni network being a piece of the elite, and then you said elite, great college experience. I saw you caught yourself on that.
But it is I think this is why people continue. You know, I again, as I go out, I tell people, open up your lens. You know, widen the the aperture on your lens and look at more than just the elite colleges. The question I inevitably get from somebody in the audience is, aren't we buying an alumni network essentially when we buy an elite college?
I will argue, yes. The elite colleges have better probably alumni networks than anybody. But can everybody really tap into those? How easy is it to tap into those now? You know, I'm wondering if that is — I wish somebody would do a study on this — has that increased or diminished over time?
Michael Horn
Yeah. So maybe let's leave it here on this segment, Jeff.
What I think is the new ... So experience, social connection was left to chance before. I would argue in an era of AI, it is the necessary part of the college experience for every single student and figuring out how you do not leave that to chance. That's gonna be what differentiates colleges and universities in the years to come.
So maybe we'll leave it there. We can't wait to hear from listeners. Let's come back. We've got a lightning round of issues we wanna get through because there's a lot going on in higher ed right now. We'll be right back on Future U.
[Sponsor
This episode of Future U is sponsored by Ascendium, a mission-driven nonprofit committed to improve learning and training systems to better serve learners from low-income backgrounds. Ascendium envisions a world where low-income learners succeed in postsecondary education and workforce training as paths to upward mobility. Ascendium's grantees are removing systemic barriers and helping to build evidence about what works so learners can achieve their career goals. For more information, visit ascendiumphilanthropy.org.
Michael Horn
Welcome back to Future U.
We've got a lightning round of headlines happening because, Jeff, like, I emailed you as we were planning for the show, and I was like, 'It's actually been a quiet couple weeks for higher ed.' And then boom, boom, boom, boom. Everything seemed to explode.
One, though, that you sent me that wasn't obvious immediately how it connected to higher ed when I read it was this Wall Street Journal article. Student loan debt is strangling Gen X.
Jeff Selingo
My good old Gen X. Are you Gen X, Michael?
Michael Horn
I am Gen X.
Jeff Selingo
I always think you're a millennial. You look so young.
Michael Horn
Yeah. If only I slide in I slide in in Gen X.
So the key stat there from that article is 6 million plus borrowers aged 50 to 61 have the highest average balance of any age group at $47,857. Lot of variability, I suspect, being masked there, but according to federal student aid data, this is the generation as you pointed out to me, Jeff, that is sending kids to college right now.
Jeff Selingo
And this is to me is where the story starts and ends for higher education.
There's not much we could do about something that happened 30-plus years ago. I get that. Right? But these are the parents of today's college students. These are the parents who raise their hands when I give talks at high schools and they say, 'How are we going to afford college?' And I think there's this data that I found fascinating when I was gathering it for the book, Michael, that Sallie Mae and Ipsos does this survey every year — they've done it for 20-plus years — on how Americans pay, for college. Increasingly, parents are saying college is not an investment in the future. Only 41 percent said, in 2024, they were willing to stretch themselves financially to obtain the best opportunity for their future compared to 60 percent a decade earlier. Here's where I think it's very interesting. Eighty-one percent now of families with a six-figure income cross a college off their list at some point because of high cost. What I think is happening here is that parents who do have student loan debt themselves are now saying to their own kids, either, 'Hey. Interest in the principal on that is too much for me. I can't pay for college for you,' or, 'This is what the investment was for me 30 years ago. I'm not willing to make that same investment now.' That's to me is why the whole value conversation around higher ed is is hitting where it is because that wasn't true of baby boomer parents who were largely the parents of a lot of Gen Xers.
Michael Horn
Yeah. I think that's right. By the way, you asked about the cost curve and all this cost, right, of rebooting certain universities or restructuring them. I do think this is what favors new universities coming in the space. I had that piece a few weeks ago where I agreed with you that higher ed is gonna thrive in the future, but I think it might be very different programs that come in and redefine the cost structure as they also redefine the experience.
Jeff Selingo
Okay. So, next topic.
The chairman of the House and Senate Judiciary Committee sent letters to a bunch of consultants and organizations that help colleges with their pricing strategies in terms of how much merit aid they give out. They wrote and they said colleges that agree to use a common pricing formula or algorithm or knowingly do so through a third party company, which I think is very important here, knowingly do so through a third party company are likely violating the antitrust laws. What do you make of this?
Michael Horn
I'm no lawyer, Jeff, but I did read Richard Hofstadter in business school — a Pulitzer Prize winner — and he has a whole piece about how antitrust law actually tends to get the small guys, not the big ones. Not to say colleges are always the small guys, but this felt a little bit like if they're right, that's sort of what's going on here. It's a downstream fallout of a business model in my mind.
This is why I would love to see accreditation reform that lets in new entrants because I think that will change the cost structure and put some more competition in there. And so I don't know if this the you know if they're right or not. To me, this is sort of chasing the symptom as opposed to the real root cause of the problem, which is we need more innovation in higher ed with, you know, new entrants that are sort of bringing lower cost structures in. That's my quick take.
Jeff Selingo
And my quick take on this is I'm not quite sure how colleges and universities could do this themselves again. Companies like EAB and Ruffalo Noel Levitz they've created these incredibly complicated, you know, algorithms and data-heavy, data-rich datasets, all done by the quants. You know, colleges can't replicate that themselves. And so if there is a crackdown on the third party providers, I just don't understand how colleges are gonna continue to be able to do that themselves.
Michael Horn
As much with this administration chasing different things, I think they chase symptom rather than root cause.
But, anyway, Charlie Javice, Jeff was sentenced. For those that don't remember, there was a this is like a big fraud story with a story of
Jeff Selingo
Jamie Dimon taking over. Right?
Michael Horn
Right, making a huge purchase and and played for a fool, if you will. What would you make of this one?
Jeff Selingo
Well, I, you know, I was a big fan of all the coverage of Theranos. I'm wondering when does the book come out? When does the movie come out? All this stuff.
The most fascinating piece of this is that she hired a CUNY professor to help her come up with, like, fake names. Essentially, the whole thing is about how they had to come up they sold this to JPMorgan Chase, and they had to come up with more names of potential customers that they claimed they had and they really didn't have. So they went out and they hired this CUNY professor to help them do this.
The CUNY professor clearly cut a deal with the government to testify in this because he seems to still have his his job, but that's the part I would love to know. You know, how did that all come about? How did they find that person? What did the professor do in part of all this? That's the part of the story that I wanna know more about.
Michael Horn
Yep. I don't know that I have anything else to add here, but maybe you'll write the book at some point. No pressure.
Jeff Selingo
I just want the movie rights.
Michael Horn
You just want the movie rights. That's the better place to be because it turns out books don't make money for those that wanna ask us those questions. What else do you have in your lightning round list?
Jeff Selingo
The only other thing I wanted to bring up here was Anthology, which really owns Blackboard now, and a couple of other things. They declared chapter 11 bankruptcy, and this is probably gonna get into the weeds for our listeners. But we know Blackboard was the original course management software way back in the mid-1990s.
But what's interesting here is that, you know, Phil Hill went deep into the bankruptcy filings, which I found really fascinating because Blackboard basically is the biggest part of Anthology, and it accounted for about $240 million.
But in structure, by the way, now much bigger, about three times the size of Blackboard. So it also just shows you, by the way, that new market entrants can kind of take over. You know, we see that everywhere. You know, Amazon, you know, and Walmart took over for Sears, and, you know, Kodak went out the door. And now, you know, Apple is the camera of choice now. So it even happens in higher ed, at least in the edtech portion of this, but it has happened over the last thirty years.
And so, Michael, I know the theme of this episode for you was new market entrants. I feel that we always think it never happens in higher ed. I understand this is not at the core of higher ed, but it definitely has happened here at least in the edtech space.
Michael Horn
Yeah. I didn't mean for it to become my answer to everything.
But I'm dusting off my ... I'm feeling pretty good about this one because this is classic disruptive innovation in the Instructure Canvas example, right, with the SaaS model compared to a server-based on-premise disruption. And then what you tend to see in markets where disruption happens is the leaders sort of do weird consolidations and efforts.
Jeff Selingo
Which is exactly what Blackboard did. Right? It was bought and sold and then combined. Right?
Michael Horn
Yep. And a lot of debt. And then it's ... And that creates challenges. And you go into chapter 11 to try to wipe that out.
And so Phil Hill, I think, has done an excellent job covering this, Jeff. But in some ways the pattern recognition is the same.
I've got one other, before I ask you something about culture because you keep writing about it. But, I have one other, which is I texted you about congress exempting some trade schools from the new accountability rules in the One Big Beautiful Bill.
I hadn't realized this. Beauty schools in particular, I think, have an exemption, Jeff, because of this weird nether land of certificate degree programs and so forth.
There's, like, a crazy irony here. I don't know if you agree, but, you know, for years, we sort of saw Obama, Biden administrations cracking down through gainful employment, in particular, on these career colleges — beauty schools being the big one that they often went after because the costs were so out of proportion with the wage gains, and yet states require these credentials from beauty schools to be able to practice, in terms of barbering and so forth.
And here you have the opposite happening where they're sort of getting pulled out of these new accountability rules.
I don't know. My initial reaction was just, this is nuts. Why are we exempting parts? We finally have a rule that can apply to all. Let's just go forward with this. It seemed nuts to me. That was my view.
Jeff Selingo
And I think as always, right, there's always going to be carve-outs in congress, and I just kinda found it fascinating that this came out after the fact a little bit because that bill was so big. Probably nobody read it until the last month.
So I just wanna wanna finish off, Michael. We've been talking a lot about culture in higher ed. You know, you and I wrote the first part of this series, which is now ending, that I worked on all this year with a number of different people. It was great to have you as a coauthor. I also just coauthored another piece of that with Sean Hobson, who's the chief design officer at Arizona State EdPlus.
We talked a lot about making change stick. And his — and this was part of his doctoral thesis as well — was really giving innovation a home. His big thinking on this was that you really do need these cross-functional units. I just mentioned James Devaney earlier, right, the Center for Academic Innovation at Michigan, Georgetown's Red House, EdPlus at ASU, of course.
And, you know, this is something that I know comes up in our discussion at Butler University in Indianapolis that we just had. That's a much smaller place than a Michigan or an ASU or a Georgetown. Does innovation need to happen within the university, or do you always need an external unit?
And so we really look at that and how culture is in place or not in place if you have it within the university or just sitting outside the university. I don't know if you have any thoughts on that, and then we'll kind of wrap up this episode for this week.
Michael Horn
Well, quick thought because I wanna counteract my market entrant push here through this topic. Right?
So here's the thing is that if culture is understood as the processes and priorities, right, that become ingrained in an organization, if you can build structures that intentionally prioritize the type of innovations you want embedded in the structure. And, yes, it sits outside the traditional governance when you're trying to do something totally different, and it can sit within when you're trying to do continuous improvement or make big structural changes to the existing. So depending on the type of innovation you want helps you understand the type of structure you need.
But I actually think building these structures so that innovation becomes more transparent, becomes more repeatable, becomes part of the culture is the key to institutions doing these sorts of innovations themselves both within the core, but also externally when they develop new offerings.
And sometimes this gets semantics. I always say, well, 'What's purpose of the innovation? Are you trying to do Southern New Hampshire and launch a major disruption?' Then do what you're doing. Right? ‘Are you trying to actually improve the core, make it more relevant, maybe not reset the business model itself?’ That calls for something different. I think structurally embedding it with real process and real repeatable formulations is critical.
Jeff Selingo
Yeah. And I'm gonna take us out here by saying you're absolutely right because part of the other piece of that paper is building dashboards, incentives, even sunset policies so you could lock in those new habits and prevent backsliding.
So it's not just about sometimes creating these external units, but really building that infrastructure needed to make sure you're tracking what you're doing. Absolutely critical.
Well, Michael, it was great to see you again, both in our respective homes for this episode. And thank you all out there for listening. Please give us some feedback, especially on that first segment. We'd love to know how you're thinking about the future of the university in an age of AI.
What is the purpose of college? If you have any feedback on that New Yorker piece that we'll link to in the show notes as well, please send it our way. We'd love to hear from listeners, and thank you again for joining us on this episode of Future U.
We'll see you next time.
