Salman Khan is the founder of the Khan Academy, a nonprofit that aims to provide what he calls a “free, world-class education to anyone, anywhere.” While working as a hedge-fund analyst, he started tutoring his cousins in math, using videos that he uploaded to YouTube. The group won its first big gifts from the philanthropist Ann Doerr, Google, and the Bill & Melinda Gates Foundation and today has 6 million unique users a month. In an interview with The Chronicle, Mr. Khan tells how his nonprofit grew.
By 2009, the Web site was attracting tens of thousands—nearly hundreds of thousands—of users a month. It was taking over my life. My wife and I had a little bit of savings, enough that I decided I could leave my job at the hedge fund where I’d been working and focus on this for a year without it ruining our chances of buying a house. I informally gave myself a year.
Nine months into it, a $10,000 check arrived. It was from someone named Ann Doerr. I immediately e-mailed her and said, “This is the biggest donation we’ve ever gotten. If we were a physical school, you’d now have a building named after you.”
She replied that she’d been using the videos and she’d love to meet. And so we met, and she said, “What’s your goal here?” I said, “I think what I’m doing is just the start. I want to build the world’s free virtual school, to provide a world-class education to anyone, anywhere.”
She said, “This is kind of ambitious, but it seems like you’re doing it, in your own way.” She asked how I was supporting myself. I said, “I’m not.” That afternoon she sent me a text message saying she’d just wired me $100,000. That’s when I began to think, Gee, maybe I won’t have to go back to work at the hedge fund.
Gates Steps Up
The next few months, it got crazier and crazier. Google reached out and started asking questions about what I’d do with more resources. Ann told me Bill Gates was a fan. He talked about Khan Academy at the Aspen Ideas Festival that summer. The Gates foundation eventually reached out. I told them and Google the same stuff I told Ann. They allowed me to hire people, get office space, and take it to the next level.
If I had to guess what was compelling to all those folks, it’s that this was a grandiose idea: Let’s take education from being this scarce thing that only a few people have to this ubiquitous thing. But it wasn’t technologically infeasible. I am sometimes delusional, I like to dream, but I think they felt that I was doing it, I had a background in software and technology, that maybe this would be an interesting horse to back.
What was a delusion in 2009 is now becoming our product road map. Over the next five or 10 years, we could be reaching 50 million, 100 million, 500 million students, really for the budget of a single high school. We’re reaching a scale that donors haven’t seen before.
Donors appreciate how data-focused we are, that we’re running experiments, that we’re measuring what we’re doing, that we’re building a platform, a brand. I think, frankly, they’re not seeing a lot of that out there.
But there’s hopefully a charm, a humanity to Khan Academy, and we never want the data to overpower that. We don’t want to lose the quirkiness of it all.
Beyond Robin Hood
We have over 3 million exercises being done on the site every day. We can start to do some of the things that Amazon.com can do to figure out which books you want to buy. We can run experiments to figure out, How do we keep people engaged? Is tutorial A better than tutorial B? One of our hopes—and I think this is another point of value for donors—is that we can be a platform for cognitive and education research.
But for some donors, we’re a strange beast. With many organizations, if you give $100, they will be able to tell you that the money will buy 50 bricks or 50 meals.
That’s good work. But with us, $100 will go to hire very talented software engineers and content creators who will reach millions of people, maybe hundreds of millions of people. It’s harder for us to do the “dollar buys a brick” calculation.
The challenge for us is to change the mind-set of donors from Robin Hood philanthropy—which is take from people who have money, give it to people who don’t, and the organization takes a little overhead cut—to our model, where all the resources go to something that is highly scalable and can reach the planet hopefully for all of time.
But in general, I’ve been pleasantly surprised by the philanthropic world. I thought there would be extreme micromanaging by donors, that a significant amount of the resources would have to be spent on grant writing.
I think the nonprofit fundraising world is far better than the for-profit fundraising world. On one level, they treat us like good venture capitalists. But they are 100 percent aligned with the mission. Our board meetings aren’t about when we’re going to monetize this class of students. They’re about whether we’re really giving as much value to students, teachers, and parents as we can.
The donors who support us want to see results. They want to see measurement and scale and impact. But if we can do that, they are willing to let you run and experiment and try new things.
Compensating Talent
There are a lot of assumptions that nonprofits will be slower, less efficient, and not attract the best talent because they can’t compensate. We do compensate. Our board insisted that we compensate people in the upper quartile in Silicon Valley. We have many, many people at Khan Academy who are making six figures and up.
Of course, we don’t give stock options, we don’t give ownership. But we’ve found we’re getting the best talent in the industry. And if we’re paying a lead software architect $200,000 and their direct creation will reach 5 million people in the next year, I don’t think that’s overhead. I think that’s the mission.
We’re finding that in the not-for-profit model, as long as you have good supporters and a good board, you can run as fast or faster than any for-profit entity. You can stay ultra-laser-focused on your mission, and you can attract the very best people on the planet.
—As told to Caroline Preston
