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New Quest: Postsecondary Education

The belief that gaming can increase user retention and engagement is not limited to “traditional” subjects taught in schools

Alternative Postsecondary Education: via Gaming

As a firm, we have been strong proponents of gaming’s potential in furthering access to effective education (Konvoy). This year, we made two investments at the intersection of gaming and education - Legends of Learning (currently math and science, ages 6-14) and Pok Pok (play-based creative exploration, all ages but designed for ages 2-6). Both of these companies target children’s education in tandem with traditional approaches.

As educational gaming platforms focus on younger generations, there is a growing need for more educational options for adults. This is particularly true given COVID-19 has accelerated the displacement of in-person jobs and this year’s economic downturn is resulting in layoffs that have vastly exceeded those that occurred in 2020.

In 2022, ~890 tech companies have laid off nearly 150k employees, with the number of layoffs in November accounting for a third of the total annual layoffs (>3x more than any other month this year). The number of tech layoffs in Q4 2022 has already exceeded that of any other quarter since the beginning of the COVID-19 pandemic, with December still unaccounted for. While unemployment in the US sits at 3.7% (as of October 2022), given the magnitude of layoffs occurring and the ongoing changes of the global economy, we anticipate this number will increase.

It is becoming increasingly important that workers today find options to upskill and adapt to the evolving needs of the workplace.

The state of postsecondary education today

Individual learners, companies, and governments currently spend $68b a year (globally) on online degrees and micro or alternative credentials (HolonIQ). This is anticipated to grow to $117b by 2025. In addition to COVID-19 forcing a market swing to online learning, there is growing public sentiment that “traditional” postsecondary education is falling behind and/or not evolving quickly enough to fulfill the rapidly evolving needs of the workforce. To clarify, postsecondary education is any education after graduation from high school, such as 4-year universities.

US adults believe postsecondary education has low ROI: >50% of adults believe that the economic benefits of a college degree do not outweigh the cost (Public Agenda). This has had an impact on US college enrollment. Over the last few years, most US universities have seen a 1.7 - 7.8% decline in college enrollment (NSC Research Center). Additionally, there are 39m adults (18.6%) in the US who have started four-year programs but have not earned a degree (Forbes). For context, in Spring 2022, overall college enrollment was ~17m students, down 3.5% from 2020 (Research.com).

Programs to increase public access to higher education are falling short: Nearly 50%of those aged 14-18 believe postsecondary education should be two years or less (ECMC Group). Two-year colleges (also known as community colleges) originated in the U.S. over 150 years ago to help expand access to public higher education, and today there are more than 1,000 two year colleges. These programs are commonly thought of as a stepping stone to a four year degree, however, that is not the reality. Only 16% of students who start community college go on to complete a bachelor’s degree within six years (NSCRC).

Alternative credentials: a path to flexible adult education

These credentials are already prevalent in the workforce today: 45% of U.S. workers say they possess some form of an alternative credential and 68% of these workers believe earning it has helped them progress in their careers. Among those who do not have additional professional credentials, about half (49%) have considered earning one (SHRM).

The public sentiment for alternative credentials is positive. Today, 72% of US workers agree that these programs are an affordable way to gain skills or experience that are likely necessary to enter a new job. Additionally, 77% agree that having a job-relevant credential increases or would increase their chances of being hired for a job (SHRM).

Employers are getting increasingly more open to alternative forms of education: >90% of HR professionals say they value the rise of alternative credentials that teach job-related skills (SHRM). Across the board, corporates believe that alternative credentials do give candidates the skills necessary for the job. 95% of executives, 94% of supervisors, and 95% of HR professionals believe that those holding only alternative credentials perform the same or better than those who only hold traditional educational backgrounds.

Gaming: a delivery method for alternative education

Video games are already being used in hiring processes to screen candidates in the place of interviews or traditional assessments: Management consulting firms McKinsey (Solve) and BCG (Pymetrics Test) both utilize video games to assess problem solving and other social or emotional traits such as attention, emotion, risk tolerance, and more. International defense organizations such as the US Army (America’s Army), the US Air Force (Airman’s Challenge), and UK’s GCHQ (Can You Crack It?) use video games to inform, educate, and recruit prospective candidates. Other private companies such as the French postal service, Formapost (Jeu Facteur Academy), and Marriott (My Marriott Hotel) have attempted to use video games for people to experience “a-day-in-the-life” of employees.

Gaming holds the potential to improve the way skills are taught and evaluated:

  • Soft Skills: The breadth of skills covered are not limited to what can be taught in a classroom or with a structured curriculum (analytics, coding, marketing, IT support for example); gaming platforms can also support teaching soft skills like communication, leadership, collaboration, pattern recognition, conflict resolution, strategic planning, and problem solving.
  • Game-like scenarios enable more realistic simulation compared to learning that is taught in a vacuum. With enough player liquidity, game-based credential programs can enable multiplayer scenarios leading to the potential to evaluate collaboration or head-to-head competition.
  • Non-linear progression: in games, player progression is not always linear and have the potential to allow for flexibility or specialization of skills taught. Some online graduate programs today allow for the bundling/unbundling of courses similar to the way that skill trees operate in RPG games.
  • Broader perspective: proof of certification is typically very outcome oriented (pass/no pass, number-based scoring). These do not tell a story of a student’s ability or the full picture for the skills or knowledge gained. Games offer the ability to tell a narrative of what a student has accomplished (including all of the twists and turns in learning that can be made through the flexibility alluded to in the previous point).

Takeaway: The belief that gaming can increase user retention and engagement is not limited to “traditional” subjects taught in schools. Online degrees and other alternative professional credentials have already gained traction in recent years and we believe that alternative postsecondary educational programs will need to continue to evolve the way that they deliver content. We believe that gaming provides the best way to deliver this content.

New Quest: Postsecondary Education

The belief that gaming can increase user retention and engagement is not limited to “traditional” subjects taught in schools

Welcome to Game Changers, the podcast that takes you beyond the games and into the heart of the gaming industry's future. Brought to you by Konvoy, a Denver-based venture capital firm investing in the platforms and technologies at the frontier of gaming. This podcast is your backstage pass to the pioneers, innovators, and visionaries who are redefining how we play and experience these virtual worlds.

In each episode, your hosts—Josh Chapman, Jason Chapman, and Jackson Vaughan, the founders of Konvoy — invite you to join them for candid and open conversations with the industry's most influential leaders. These guests are the “Game Changers”, the masterminds behind the scenes who've built remarkable enterprises and continue to push the boundaries of what's possible for our industry.

Whether you're a gamer, a tech enthusiast, or a startup aficionado, the Game Changers podcast offers valuable insights, inspiring stories, and exclusive access to the minds shaping the future of the gaming industry. Join us as we explore who these Game Changers are, what they've built, and what they're doing now.

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