The edtech startup that's shucking the playbook by acting like a consumer company

By Carmel DeAmicis , written on March 12, 2014

From The News Desk

It's rare that my mom knows the startups I'm writing about. It's even rarer when she's the one who tells me about them to begin with. It has happened exactly once.

Her first week on the job as a principal in a new school district, she asked me, "Have you heard of ClassDojo?"


"All my teachers are using it," she said. "I've never seen anything quite like it."

And nor, apparently, had I. ClassDojo is one of those startups that which have avoided Silicon Valley buzz while apparently catching fire in the real world. It's a two and a half year old edtech company, focused on student behavior and backed by the likes of Paul Graham, Ron Conway, Lerer Ventures, and General Catalyst. It graduated the Imagine K12 edtech accelerator in the summer of 2011 and won the Today Show's Education Nation Innovation Challenge in 2011.

Here's how it works: Teachers input their class roster, and students are turned into avatars: one eyed green monsters or pink furry creatures, that kind of thing. Students can customize their cartoon selves at home with hats, scarves, headphones, and other accessories. Whenever a child does something well, the teacher gives them a point in that category, such as teamwork, hard work, leadership, on task, participation, and persistence. Teachers can also create their own categories.

It's the digital version of the old analog "pulling your card" system for controlling student behavior. But there's one big difference: It's not built to be punitive. Teachers have to manually change the settings if they want to be able to take points away from kids. Parents can check in on their child's progress from home, seeing how well they've performed in terms of each type of behavior.

And here's the killer stat: ClassDojo has 30 million users in more than 100 countries.

"We're in this weird spot where in the last two years we've grown really quickly without a sales or marketing team," co-founder Sam Chaudhary tells me. Because of that rapid growth, when it came time to re-up for their Series A Chaudhary and his co-founder  Liam Don closed the deal in four weeks, snagging $8.5 million. That was back in January 2013, but they just announced the round last week.

"It wasn't newsworthy for our users," Chaudhary says. "Funding isn't relevant for teachers." Educators, parents and students are ClassDojo's focus. So much so, that Chaudhary and his co-founder Liam Don's first employee hire wasn't an engineer or even a salesperson -- it was a teacher.

Certainly, when you enter ClassDojo's offices it doesn't look like what you'd expect from an edtech company. It is, however, exactly what you'd expect from a startup. A sea of young twenty-something dudes typing away in front of screens of code. One wall is covered in ClassDojo pictures drawn for them by kids, another wall in CNN-style flat screens broadcasting the countdown to one billion "feedback points" awarded through ClassDojo.

Chaudhary is a Cambridge grad and his co-founder Liam Don is a Durham grad. They both felt passionately about education and decided that they wanted to tackle the issue with a startup instead of research or consulting. Don quit his PhD in education technology, and Chaudhary left McKinsey where he was working as an education consultant. They started out together to build a company.

When trying to come up with the product idea, they looked around and saw that most edtech companies didn't scale well. "They're going district by district and school by school," Chaudhary says. "They're not necessarily building great products, they're building what the districts already know how to buy."

Chaudhary and Don decided to take a different tact and went straight to teachers to find out what they needed. They cold-called and emailed hundreds of teachers off school directories, asking them about their problems in the classroom.

"They told us, 'I took a pay cut and work hard to be a teacher because I want to do great things for these kids. But instead I turn up and I have to punish and discipline and basically babysit,'" Chaudhary remembers.

That's where the idea for ClassDojo was born, with the hopes of helping with  classroom behavior management and character building.

"If you build something teachers want they will love it and tell everyone in the world about it," Chaudhary says. "Teachers are the key to the education marketplace."

ClassDojo shows the potential of the consumerization of edtech. One in three schools in America has a teacher using the technology, despite the fact that the startup doesn't have a single salesperson on staff. It was able to penetrate the complicated district purchasing process by offering the technology for teachers to adopt for free.

It's the same play that companies like New Relic and Expensify have made. Offer the technology for free for the end users, then if companies want to spend more for control and analytics features they can.

Of course, ClassDojo will face its own challenges with that approach. It has earned a whopping $0 in profits, taking the Pinterest approach of building out a huge user base before ever trying to monetize it.

Chaudhary and Don want to eventually roll out a premium version -- providing tools like year-long analytics of students' progress. But they haven't attempted that yet, so there's no way for them to know whether it will be a success.

Although it's sitting pretty on $10.1 million in venture capital, eventually it will need to start making its own money.

"You're the master of your own fate at that point," Chaudhary says. "Until then you're at the hands of your investors."