Welcome to the 12th episode of The High School Business & Personal Finance Teachers Podcast hosted by Knowledge Matters. This episode of the podcast features a special interview with Peter Jordan, CEO and founder of Knowledge Matters. Jordan discusses the brand-new Virtual Business - Entrepreneurship (VBE) simulation, and how teachers can use VBE to help students turn their entrepreneurial dreams into reality.
The High School Business & Personal Finance Teachers Podcast hosted by Knowledge Matters is designed to interview teachers about how they got started teaching, tips and tricks for teaching business, marketing, and personal finance to high school students, and how teachers use Virtual Business simulations in their classrooms.
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If you’re a high school business, marketing, or personal finance teacher, we’d love to interview you for the podcast. Please send us an email at email@example.com
Transcript of Episode 12 of the High School Business and Personal Finance Teachers Podcast
Jeff Rutherford, Marketing Director, Knowledge Matters: Welcome to the 12th episode of the High School Business and Personal Finance. Teachers podcast. Stay tuned for our interview with Peter Jordan, CEO and founder of Knowledge Matters. Stay tuned for the interview.
Welcome back to the High School Business and Personal Finance Teachers podcast brought to you by Knowledge Matters. Today we have a special guest on the podcast - Peter Jordan, founder and CEO of Knowledge Matters. Pete is here to discuss our brand new Virtual Business simulation that was launched this week - Virtual Business - Entrepreneurship. Virtual Business - Entrepreneurship is the ninth virtual business simulation for high school business, marketing and personal finance teachers that Knowledge Matters has launched. So, Pete, for those listeners who aren’t familiar with Knowledge Matters or the Virtual Business simulations for high schools, can we take a moment and have you explain the history of Knowledge Matters and the Virtual Business simulations?
Peter Jordan: All right. Hi, Jeff, and thank you for having me here. Absolutely. And it fits right in with our theme of entrepreneurship today. Knowledge Matters came from sort of an interesting spark. I was actually working for a company that had over 100,000 employees and wasn’t particularly happy there. And I’d always had an interest in simulations. And one day I literally walked in and a coworker showed me the original SIM City.
I knew that there had been business simulations that were numbers in, numbers out and even some municipal simulations. I looked at that and said this is going to engage at least 10 times as many people as the numbers stuff. And boy, was I wrong. It probably engaged a million times as many people. And right from that day, I pretty much decided to be an entrepreneur and quit my job and set about trying to build visual business simulations.
From there, we introduced some early retailing simulations and have grown the company ever since going from a CD era, obviously, to everything online now.
And we’ve been really fortunate with everything. We’ve been able to serve over probably half of the high schools in the country so far and together with some really great CTSO organizations, hopefully build interest in career and technical education and increase enrollments in these classes.
Jeff Rutherford: Great. What was the impetus or idea that drove the development of this latest simulation Virtual Business - Entrepreneurship?
Peter Jordan: Our customers and teachers all over the place. They have been asking us for an entrepreneurship sim for a while. And teachers have been using our simulations to teach entrepreneurship for a long time. Almost all of our simulations involve the ability for a student to start a business. But there were certain aspects that we just weren’t getting at correctly.
We weren’t getting at. How do you choose the opportunity from a whole bunch of different businesses? How do you finance it? How do you take money from one business to another one as you’re trying to grow an empire? And so we went out and we talked to teachers.
We asked them what businesses they would like to have in such a simulation. And then we tried to put together something that was very specifically dedicated to the peculiar characteristics of starting a business from scratch. That entrepreneurial spark.
Jeff Rutherford: Who wrote the written lessons in Virtual Business - Entrepreneurship?
Peter Jordan: We’re very lucky to secure an author Cindy Greene. Cindy taught business in the Atlanta, Georgia school system and entrepreneurship for over 25 years. And she’s the author of numerous entrepreneurship books with some major publishers.
She also had a huge role in entrepreneurship development as a discipline within the NBEA organization. So she has been absolutely wonderful to work with. And I think we’ve got some really great written content in there.
Jeff Rutherford: Great. For the high school business marketing, personal finance teachers who are listening, what does Virtual Business - Entrepreneurship offer them as a digital teaching tool to teach their students entrepreneurship?
Peter Jordan: It’s really a kind of a soup to nuts way to get your students involved. Cindy was great in letting us know that we needed to address students who might be taking this as a first business course. They may have never heard of revenue or expenses or profit all the way up to really challenging students who might be taking it as sort of a capstone project.
And so what we did was we created something that is just sort of a ladder, if you will, stepping stones to getting them interested in entrepreneurship. The very first sim exercise that we have in there, all the student needs to do is run it forward to make the goal in it. They answer some questions, but then run it forward. And that’s to get them used to seeing a business in action, seeing the numbers coming up, making a goal, being successful.
Then we build throughout all of these different skills that you’re going to need for entrepreneurship - fundraising, team building, everything else up to a point where they’re trying to, in the final project, start an empire that could include multiple instances of different types of businesses across 11 industries in a dynamic economy with competitors entering and leaving.
So all the way from, “I can just hit the red button and watch a business go” to, “I can run across eleven different industries”.
We hope that that’ll be something that will both intrigue the students, engage them and challenge them, but also be inviting to the most introductory students.
Jeff Rutherford: Two of the Virtual Business - Entrepreneurship projects, the capstone projects in the simulation, operate differently than some of our other simulations. Can you walk teachers through the Business Plan Project and the Shark Project, and how these will work in the classroom?
Peter Jordan: Yes, absolutely. They are a little different. And again, we wanted to really capture some things that we hadn’t in our other simulations.
As most of our current customers know, with the virtual business simulations, the students do their work. And the teacher can guide them and be there as a resource. But a lot of it, the students work along just at their own pace without necessarily a lot of interaction with other students in the classroom.
We felt that entrepreneurship had a real personal and human aspect to it that we wanted to bring into these activities and in particular - trust. Trust among investors, entrepreneurs, et cetera. So we designed these two projects with a little more of a human element than some of our past stuff.
In the Business Plan Project, that trust is going to be between the students and the teacher. And it’s the students trying to convince the teacher to give them a bank loan that will allow them to get their business off the ground. The students will go into their simulated city and environment, research it and find out about competitors, consumer demand, labor supply, and then create a full business plan.
This is something they will have previously gone through in a lesson and learned the format - how it’s put together, how you do the research to build a good plan. Then they’ll write it up for the teacher. And we made it so that it can be any format they want. They can submit it in Google Docs or Word or anything like that.
Once those are all submitted to you, the teacher, then you will go into your grade matrix page and simply open up that student’s simulation. A page will pop right up there in front of you and allow you to input a grade for that written business plan, as well as give the student a loan based on the funding they’ve requested and create an interest rate for them.
On that page right there in front of you, we’ve given you all sorts of rubrics to how to evaluate the business plan. We’ve given you indications in that particular student’s sim of what the opportunities are that are really good in that city that they saw. So you can tell whether they identified them without having to go in and do all that research work yourself.
Also giving you an example of what we think is a well-written business plan. At that point, you go ahead and give that student a loan, and then the student is off and running to create their business and hopefully succeed with it.
But as we know, I think it was Dwight Eisenhower said that plans are useless, but planning is invaluable. That’s one of things we want the student to learn, because they will stray off of their plan. All businesses do. But the fact that they thought it through and understood their environment is gonna be super valuable to them.
So that’s our Business Plan Project. We think they’ll be able to carry that for years out in their life - that experience whenever anyone asked him about a business plan. They’ll understand basically what they need to do now.
The Shark Project is patterned after the sort of shark tank shows that so many of these kids have grown up watching. So it’s going to be an environment where they’re going to pitch their ideas. But instead of having an outside panel of sharks or something to evaluate it, it’s going to be to their fellow students.
The students in this one will do virtually all of the work. You only have to do a couple of clicks to make it all happen. Basically, the students all see a different city in this one with different opportunities. They have to do an analysis of the competitors, consumer demand, labor supply, etc., and then pitch what they think is the best business in their particular city to their classmates. And then the classmates hear all these pitches and can make decisions on what to offer. I’ll give you forty thousand dollars for 10 percent of your company, just like they see on TV.
And there’s a system that we built where the students will be able to input all of that. When you’ve got that whole thing done and everybody’s made their presentations and made their investments decisions, you as the instructor will just go in and essentially two or three clicks be able to preview what will be a stock auction, essentially where those people who bid the highest per stock will be the ones who get it. Once you see that everybody has input their stuff properly, you’ll hit a button, and finalize it. And then within each of the student simulations, they’ll get to see how much money they got and who they got it from.
From there, they’ll go on to run their own business, but also watch this portfolio that they’ve developed. And typically they might have, you know, seven or eight investments that they’ve made, and their grade on that project is the sum of how their own business does and how their investment portfolio does.
We’re really excited about that. It’s going to create great dynamics in the classroom. Students are going to be not only watching their own thing, but yelling, “Hey, Diane, what are you doing over there? I’ve got an investment with you. Why is it going downhill?” We’re super excited about both those projects. They not only utilize the technology of the Knowledge Matters sims, but also greatly increase the human interaction.
Jeff Rutherford: Those sound like a lot of fun. Virtual Business - Entrepreneurship launches with eleven possible businesses within the simulations that students can start and run. Will the number of businesses available be expanding?
Peter Jordan: Yes. We started with eleven because we want to get a feel for how it was all playing out, but we’re planning to expand that to 20 businesses. And I would expect to see that over the coming six months or so. Even with eleven, I’ll tell you that with some of our testers working on it, there’s a lot of challenge out there. But 20, will keep it challenging for a long time to come.
Jeff Rutherford: If someone listening hasn’t used a Virtual Business simulation before in their classroom, do you think Virtual Business - Entrepreneurship is a good simulation for them to start with?
Peter Jordan: Absolutely. And that ties back to what I talked about before with the way it can take an introductory student right up to a more advanced student. And I give a lot of credit to Cindy for keeping our eye on that. When you come into this thing, we assume no knowledge of business whatsoever.
So it’s a great way to just drop your students in there. They can drive their way all the way through the first 15 simulation exercises before you as the instructor have to get involved at all. You could go totally hands off. So it is a great way for both instructors and students to get familiar with the Virtual Business format.
Jeff Rutherford: Virtual Business - Entrepreneurship is more expensive than the other Virtual Business simulations. Why is that?
Peter Jordan: Well, first of all, almost half of our customers for Virtual Business - Entrepreneurship are taking advantage of something that we introduced a couple years ago called All-Access pricing.
So for them from an incremental basis, they will pay nothing extra and they already have access to our previous simulations. For those customers that do prefer to purchase product to product, we’ve always really focused on value. And when we look at Virtual Business - Entrepreneurship with its 15 sim exercises, it has about 1.5 times as many same exercises as most of our business sims.
It also has three variations on three different projects where there’s a randomness that you can use to play the project essentially over and over again. So with those three variations on three projects, it’s got about nine times as many project possibilities as a typical Virtual Business sim. And then of course, it’s got eleven times as many businesses, going to 20, as a typical Virtual Business sim. So we think in terms of value for your dollar, and we understand how hard teachers work for their dollars out there, this is at least as good as any sim we’ve ever produced. And probably the most value for the dollar that we’ve ever produced.
Jeff Rutherford: That’s all the questions we have for now. Do you have any final thoughts as we wrap up?
Peter Jordan: Just in terms of Virtual Business - Entrepreneurship, if we go back in time, even before that spark caused me to begin, Knowledge Matters, I have a recollection of sitting around on an apartment floor while I was a graduate student in business outside of Boston and just kind of scribbling diagrams of a world with businesses and consumers and competitors, etc., and thinking, gee, that really ought to be a way to study business with a complete virtual world in which students could live out their hopes and dreams and learn and get engaged without any risk. Perfect virtual economy and ecosystem. And we are certainly still a long ways from realizing that ideal vision. But Virtual Business - Entrepreneurship is definitely the closest we’ve come so far.
Jeff Rutherford: Great. Again, we’ve been speaking with Peter Jordan, founder and CEO of Knowledge Matters. As we’ve been discussing, Knowledge Matters ninth high school business simulation has just been released - Virtual Business - Entrepreneurship. It features 10 lessons and 18 simulation exercises. If you’re a high school business marketing or personal finance teacher and you’d like to learn more about virtual business entrepreneurship, you can go to our Web site at www.knowledgematters.com. We’d love to talk to you about how you can use Virtual Business - Entrepreneurship in your classroom. Thanks, Pete.
Peter Jordan: Thank you, Jeff.