Frank Ferguson went from a tiny farm in Iowa to shooting films in Iran to heading one of America’s iconic startups. Yet that’s only half the story of this remarkable doer whose idealism and good sense helped him build a company that is improving outcomes for 10% of school children in grades K-8. I had the opportunity to interview Frank and the conversation is captured in a podcast titled “Practical Dreamer” which you can find here: Frank Ferguson's Page at Angel Invest Boston. A transcript of the chat with subject headings is also provided.
Teheran to MIT to 70% Annual Growth at Bose
After graduating from what is now Iowa State University, Frank found a job working for Syracuse University making movies in Teheran, Iran. There a friend suggested business school at MIT or Harvard. To Frank’s surprise he was accepted at both but chose MIT/Sloan because they offered better housing for married students. Within 10 years of getting his MBA he was invited by Amar Bose to be president of the Bose Corporation. It was an era of 70% annual growth at Bose. Bose speakers had a much better sound at a fraction of the price of high-end speakers. After six years at Bose Frank left because Curriculum Associates, a company he had helped found before joining Bose, needed help.
Curriculum Associates Builds a Measurably Better Curriculum
Curriculum Associates (CA) sought to supplement instruction of students for whom the existing curriculum was not adequate. They offered materials that allowed teachers to individualize learning for students in their class based on each student’s level of readiness. The educational publishing business offers formidable barriers to new entrants. It takes a lot of convincing to get a school system to adopt new material. Rather than taking on the established players head on, Frank led CA to emphasize supplemental materials that had to be purchased every year. Eventually CA established its offerings as effective in improving student outcomes. There were two key elements to this success: (1) individualized assessment of students that empowered teachers in providing help where needed and (2) teacher training which greatly improved student achievement using CA materials.
Frank Funded His First Angel Investment from Frugal Living – Huge Bet on CA
Frank was angel investing from the time he graduated from MIT/Sloan. I wondered how this guy from a modest Iowa family got the capital to invest. The surprising answer was that it all came from savings. While working in Iran, he and his wife lived frugally and saved enough that he could write a $10,000 check to some guys who had an idea of creating a better curriculum. In today’s dollars the investment would be the equivalent of $82,000. Another interesting aspect of the story is that Franks’s salary in Iran had been only about $9,000 at the time. This meant that he made a big bet on CA back in 1959.
Like Elon Musk, Frank Ferguson likes to Make Big, Concentrated Bets
Making big bets on people and ideas which excited him would become a theme of Frank’s investing career. Unlike most angel investors I know, including me, who prefer to diversify among at least a few dozen investments, Frank preferred to make a handful of concentrated bets. He then backed them to the hilt with his money and considerable energy. This approach, which is similar to Elon Musk’s, has provided excellent results for Frank. CA was huge success, as was Bose (another early investment) and most recently Loop Pay which is now Samsung Pay. He was also lucky to have participated in the IPOs of Baird Atomic and the Ealing Corporation as an employee. He is now on the board of Senscio which is bringing artificial intelligence to bear on the home care of very ill patients.
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