12/28/2011 03:11 pm ET Updated Feb 27, 2012

Can Crowdsourcing Disrupt Education?

By Deborah L. Cohen

CHICAGO (Reuters) - Former teacher Alex Grodd is betting on social media to solve a big problem in education: how to tap other teachers' hands-on experience for what works in the classroom.

His startup, BetterLesson, is leveraging the popular information-sharing model known as crowdsourcing. It provides a platform for teachers in the K-12 grades to share their best lesson plans with other educators across the country.

"I really struggled each night to figure out what I was going to teach and how I was going to teach it," said Grodd, who taught with the national teacher corps Teach for America and in charter schools.

"Once I actually created something neat, I had no way of sharing it." Grodd, who launched BetterLesson in 2009, is part of a new crop of online entrepreneurs trying to shake up the entrenched U.S. education products and services market. Their foray comes amid trying times for schools: nationwide slides in student performance, teacher attrition, cash-strapped budgets and ongoing economic uncertainty.

In September, BetterLesson received $1.6 million in venture backing and is signing up new teachers at a rate of $250 a day, Grodd said. The business uses a "freemium" model, offering the service at no fee to educators, while charging school districts for premium features such as custom analytics.

It has signed up a smattering of charter schools around the country, including some in New York and Los Angeles.

"We're trying to disrupt the industry by creating a crowd-sourced, teacher-curated platform," said the Boston-area entrepreneur.

Pioneers such as Grodd are leveraging the popularity of social media and advances in cloud-based computing to do everything from giving teachers more control over their classrooms to providing students with money-saving alternatives to costly supplies.

Slow to capture the attention of investors worried over the bureaucratic nature of the market, these ventures now appear to be gaining ground. Among the best known is Edmodo, a social learning network for teachers, students and parents that allows grades and homework to be assigned and submitted online.

Launched in 2008, Edmodo now has 4.8 million users and in December secured a second round of funding totaling $15 million.

"Education is a tough market, particularly on the enterprise side of the equation, with regulations, sales cycles and politics," said Frank Bonsal, general partner with the VC firm New Markets Venture Partners, which invested in BetterLesson. "But I do think you're going to see more and more of this because the need is there."

Entrusting power to those who teach and learn Consider ClassroomWindow, another Boston startup designed to offer teachers a dedicated channel to review the products and services they regularly use. The concept is not unlike the popular online site Yelp, where customers rate everything from restaurants to retailers, collectively sharing information about their experiences.

"One of the major failings in the educational marketplace is a lack of data from end users," said company founder and CEO Kirby Salerno, noting that the $25 billion K-12 market is dominated by major suppliers such as the publishing houses McGraw-Hill and Pearson. "This puts teachers in an incredibly powerful position."

Classroom Window, which is expected to launch in beta in early January, is free to teachers, who can choose to be anonymous when creating their reviews, eliminating worry over possibly offending administrators who hold the purse strings, Salerno said. Profit is expected to come primarily from selling their opinions, which could give suppliers valuable insight about what's good and bad about their products.

Salerno is bootstrapping development with less than $1 million in funding from friends and family. "You've got this sort of massive marketplace that is irrational," said Salerno, a prior cofounder of Seattle-based startup Teach First, an online video database designed to help newer teachers that was sold in 2008. "We're intentionally creating a very, very low barrier to entry for teachers and schools to participate."

Educators' willingness to sign on may be helped by the proliferation of broad-reaching social media platforms such Facebook, Foursquare and Twitter, according to Kim Smith, cofounder and CEO of Bellwether Education Partners, a nonprofit group supporting educational innovation.

"People are getting more and more comfortable with social media and crowdsourcing in the rest of their life," Smith said. "You are starting to see these crowdsourcing solutions. It's just an entirely different market than we've seen before."

Students at a variety of levels are likely to have an increasing role in controlling the products they do and don't buy. At least that's the hope of Chicago-based attorney and nascent entrepreneur Ryan Jacques. Jacques is developing a crowd-sourced platform called EditionMatch that will help law students and others avoid the cost of purchasing brand new textbooks each year.

His startup will enlist students' help to create online indexes to bridge the gaps between older and newer versions of the texts.

"The impetus was personal experience," said Jacques, who plans to launch the site early in 2012.

"Law school books are extremely expensive. Previous editions of these textbooks were exponentially cheaper."