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Degreed wants to make online courses count

08/16/2013

CNN Money.  August 15, 2013.  Over the past few years, millions around the world have signed up for free online courses to date. In theory, such courses can give anyone with Internet access a taste of the Ivy League. But despite its popularity, employers are slow to acknowledge online education's value. In the same way that trust and reputation buoy a company's stock, education is also based on brand value.

"The only language we have to communicate our educational accomplishments to each other is all baked into the formal degree," says David Blake, co-founder of San Francisco-based startup Degreed, which bills itself as "The New Degree for the New World." But a certificate you received in your early twenties isn't necessarily the best indicator of what you actually know.

Launched in January 2013, Degreed is trying to address this problem by giving a score to university degrees and online courses alike. If you graduate from Harvard with an economics degree, for example, you'll earn 3,787 points. If you complete a programming course at Codecademy, that gives you 13 points. Points are tallied and stored on user profiles on Degreed. Users can get their transcript, identity, and degree verified for $12 each. "We normalize the data to help make the disparate world of education something that's easily understood by employers and others," says Blake, 29, who built Degreed with $900,000 in angel funding from five angels including Mark Cuban, the owner of the Dallas Mavericks. Degreed is also currently part of the Kaplan EdTech accelerator program.

To be sure, Degreed isn't alone in its quest. Accredible, Mozilla Badges, and Coursera's Verified Certificates all aim to confer value to the online course. This development points to a larger challenge: To disrupt -- rather than merely dent -- higher education, employers must acknowledge that online learning has value as an alternative to the traditional degree. Blake says he is currently working to convince businesses to accept Degreed scores. He's also pitching it as a way for companies to track their employees' training.

When it comes to gauging your education and qualifications, employers take the word of the college, which currently has a "stranglehold over the market for credentials that matter," argues New America Foundation education policy director Kevin Carey. As long-established institutions, universities command a level of trust that's extremely difficult to match in just a few years. After all, it's been just two years since Sebastian Thrun first put his artificial intelligence course online and the Massive Open Online Course, or MOOC, made its initial splash.

Carey sees Degreed's offerings as one potential solution to this challenge. By his reckoning, the next wave of disruptive education-related technology will be focused on showing evidence of learning. Credentials are just about "organizing information in a useful way," he argues, and if startups like Degreed can provide such information clearly and meaningfully, then MOOCs have a shot at credibility.

But where does that leave university accreditors? There are seven national accreditors in the U.S. and six regional ones. For decades, these institutions have functioned as gatekeepers to the higher education world, and they're having a difficult time fitting the MOOC into their universe.

This year, the American Council on Education recommended that 11 MOOCs from Coursera, Udacity, and edX be eligible for college credit. If students can earn academic credit and not just certificates from online courses, then MOOCs will accrue more value. But it's unclear whether universities would even want this from their own MOOC. If an institution grants credit to students for another university's free MOOC, it could rob both universities of potential revenue.

"The accrediting system is having a great deal of difficulty with new technology and with anything that smacks of learning outside of fully accredited higher education institutions," says Anthony Carnevale, director of Georgetown University's Center on Education and the Workforce.

Accreditors are used to evaluating entire degree programs at universities, not just individual courses, posing yet another challenge for MOOCs. "We don't have a lot of experience or credibility accrediting individual courses," says Tony Bieda, a vice president at the Accrediting Council for Independent Colleges and Schools.

Degreed's David Blake feels strongly about breaking the degree down so that it counts module by module. "Right now, the degree is the only unit of education," says Blake. You either have one or you don't. Even if you drop out having completed 90% of the course, you aren't considered 90% educated. "If we can help enable education at a more modular [level] to be recognized and meaningful, then it unlocks incredible efficiencies," argues Blake.

Carnevale has his reservations about Mozilla Badges, Degreed scores, and Coursera certificates. "They say how much time has been spent in class rather than how much students actually learned." To really be meaningful, Carnevale says that these services need to assess what people learned and whether they found jobs after finishing these programs.

To be sure, Degreed doesn't claim to fulfill the function of an accreditor. It's focused on packaging and demonstrating what users have learned. With accreditors catching up to online learning and users taking more online courses, the system will need a better way to assess students' hard work.