← How I Built This with Guy Raz
How I Built This with Guy Raz
(September 2020) Khan Academy: Sal Khan. From Tutoring His Cousins to Teaching the World For Free
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- [00:00]
A
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Hey everyone, it's Guy here. So it is the holidays and this week we're going to bring you a conversation from our archive. It's with Sal Khan, and he tells the story of how he started Khan Academy, which is a free online tutoring service that now has over 170 million registered users and lessons in over 50 languages. This episode first ran back in 2020. It is such a good one, one of our absolute favorites. And I hope you love.
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B
Was incredibly stressful. We were digging into our savings, about five or six thousand dollars a month. And, you know, but my male ego was trying to shelter my family from it. So I was putting on a strong face to my friends and family. And you can imagine my mother who, you know, when I told her I'd quit my job, I still remember her first.
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A
Welcome to How I Built this, a show about innovators, entrepreneurs, idealists, and the stories behind the movements they built.
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I'm Guy Raz. And on the show today, how a random decision to help a cousin with her math homework led Sal Khan to build Khan Academy, a free online teaching platform with nearly 30 million users a month.
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So most of the products and services.
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C
We'Ve talked about on the show have.
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A
Been innovative or disruptive in some way. But some of them, and you've heard me say this before, have fundamentally changed.
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C
The way we live.
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A
I mean, Lyft, Airbnb, Starbucks, Shopify, Wayfair, these brands have transformed the way that many of us shop and travel and work. But what about someone who makes a.
- [05:08]
C
Product or offers a service that is.
- [05:11]
A
Equally transformational, maybe even more so, but makes it 100% free? To do that, you have to make personal sacrifices, starting by earning a lot with less money, which is just part of what makes Sal Khan so incredibly remarkable. Over the past 12 years, he's built Khan Academy into a powerhouse, a massive online learning platform that offers free tutorials to anyone, anywhere. And from the very beginning, Sal decided his academy would be a nonprofit, that it should never be tempted to compromise on its values. But before he launched Khan Academy, Sal didn't anticipate any of this. He was just trying to help a younger cousin with her sixth grade math lessons. At the time, he was working for a hedge fund. But from those early days of doing one on one tutorials, Sal gradually built a platform that offers hundreds of classes in dozens of languages. Nearly 30 million people use Khan Academy every month to learn math, science, the arts, even SAT prep, all for free. And Khan Academy has inspired the launch of many other online learning platforms. But many of them are for profit.
- [06:32]
C
Operations that charge money.
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A
But we'll get to all that in a moment.
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C
First, let's back up just a little bit.
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A
Sal Khan grew up in Metairie, Louisiana. His mom was from India and his dad was from Bangladesh.
- [06:45]
C
And the marriage ended when Sal was pretty young.
- [06:50]
B
My parents had issues, and so they separated when I was probably about 18 months old, 2 years old, and then I had really never seen my father again. I saw him once for an evening when I was 13, and then he passed away the next year. So it was really my mother who raised us as a single mother.
- [07:13]
A
Wow.
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C
Was there a community of South Asian families in Metairie when you're growing up?
- [07:20]
B
Yeah, my. You know, when my parents separated, we actually lived with my young uncles at the time. They were in their 20s, and so they all were kind of like father figures and almost like older siblings to me as well. And in a lot of ways, they were not your stereotypical, you know, just come to the US Study, you know, get a job, save money, kind of prudent immigrant story. They were much more embracing of New Orleans culture. And I would say they're the most New Orleanian South Asians you will ever find in your life. I had a very colorful childhood. You know, late night parties, people singing and dancing. You know, for me, it felt like I remember my third birthday that my uncles got a belly dancer. I still remember Habiba, you know, so it was definitely a different type of childhood, but it was in some ways a really rich one.
- [08:13]
C
Sal, what did your mom do for a living?
- [08:16]
B
The first job that I remember her having, she was the person who takes the change out of the vending machine at the local hospital, actually the hospital where I was born. And she took me to work a couple of times because she didn't have childcare. And I thought at the time, I remember watching her do that. I think it was like the coolest job on earth because you have this key that you can open up the vending machine and quarters just pour out of it. So she did that for a little bit and then essentially was a cashier at a series of convenience stores, just kind of doing one minimum wage job after another. And then I was in high school, she had remarried. Her and my stepdad at the time were able to kind of cobble together to get a small convenience store in Metairie.
- [09:02]
C
In your book, you write Louisiana was as close to South Asia as the United States could get. It had spicy food, humidity, giant cockroaches, and a corrupt government.
- [09:14]
Which is both funny but somewhat true, I guess. Right? I mean, you grew up at a time when David Duke was the representative in the state legislature.
- [09:26]
B
Yeah, the part of Metairie where we had our store, it was called Seminole Convenience Store on Seminole Avenue, and it's called part of Metairie called Bucktown. That was kind of the heart of David Duke's base, so to speak. I remember right outside of our. Our store across the street was the largest David Duke for President sign I've ever seen. And so it was a. You know, the folks who lived in the neighborhood who were, frankly, you know, super David Duke supporters. You know, in some ways, it was lucky. This was pre 9 11. They didn't really know what to make of my family at the time. You know, we've had a few conversations, I remember, with people at the store where they. They openly told us that they were trying to decide whether we were white or the N word. You know, we were confusing them. But you. Growing up, I was the only brown kid in the classroom, but I never felt in school at all like folks were in any way biased or racist against me. If anything, I have to give the school system, the Jefferson Parish School system, a lot of credit. I think a lot of what I am today is because they gave me opportunities. There were teachers that believed in me. I had a really good friend circle. So I have no. You know, I don't feel like it was a tough childhood.
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C
Sal, was your mom, did she have very strict expectations for you? I mean, she had come from India to the United States, made a lot of sacrifices. Did she sort of, you know, would she say you have to be an engineer, a doctor, a lawyer? Like, was there any kind of talk like that at home when you were a kid?
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B
You know, my mother definitely did instill some really strong values just seeing her operate. My mom is a very courageous person, and we were the only family in our friend circle where we were kind of not well off, or at least not middle class. But I think that was helpful, too, because the family friends we had, many of them were the stereotypical doctors and engineers. And you obviously can see where you live and you see where those kids live, and you can see kind of our financial insecurity. I still remember I must have been eight or nine years old at Kmart, and I was being a brat. I really wanted to buy this hot wheel set, and I was throwing a tantrum in the Kmart, and I remember that was the first time that my mom kind of just kind of broke down a little bit and says, don't you realize we have no money? And.
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One of my uncles, they had A food store in a really rough neighborhood in New Orleans. He got shot. You know, people, you know, we thought he was gonna die. I think I was about 8 years old at the time, so I was just like, I don't. I don't want that life. I'd rather have the life of my other South Asian friends who are. Whose parents are, you know, who are professionals.
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C
I read that when you were in high school, you were in a heavy.
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A
Metal band or a death metal band.
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C
Or I don't know which one. Which one was it? Is that true?
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B
Yes. I was the lead singer. But, you know, singing is being very generous to what I was doing. It was more of yelling or growling.
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C
You were the lead growler of the death metal band?
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B
I was the lead growler of a death metal band.
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C
What was the band called?
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B
Original name. And I cringe when I say these things now. It was Malignancy, but then we had to change our name because there was a band in Florida called Malignancy. And so anyway, you know, it was me and three other guys.
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C
All right, so you were in this band and. But it sounds like school was pretty easy for you. You were doing pretty well.
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B
Yeah, I was a kid that kind of did just whatever I needed to do to get a decent grade. And it was about 9th or 10th grade that I started getting really serious about studies. And I remember in 10th grade, I kind of lived this double life where I was on kind of the academic teams and quiz bowl and Science Olympiad, and I was chosen to be on Representing Louisiana at National Academic Games. And it was the same weekend as our first big gig as a death metal band. And so I had this kind of path. I had this choice that I had to pick.
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C
This was Malignancy's first main gig.
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B
Yeah, we had an opportunity to open up for Paralysis, which is a big deal.
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C
And Malignancy opens for paralysis.
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B
Yeah, it's definitely. And, you know, some of my. The people who are in my band, they were starting to get into trouble. Some of them started doing some drugs, you know, getting. Getting a little bit into, I would call a scary crowd and that, frankly, scared. You know, I had my quiz bowl and academic games friends.
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And then I had some of my other friends who were, you know, their life was getting really tough and they were starting to, I would say, get into trouble. And that. That scared me.
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C
So when it came time to apply to college, were you encouraged to aim pretty high, like, to a prestigious school?
- [14:26]
B
Yeah, I give a lot of credit to my sister. You know, she was always A little ahead of me. And I looked at the schools that she was applying for when she was graduating from high school. I was in middle school or freshman at the time, and she was applying to places like Brown University. And I was like, farrah, have you looked at the tuition at Brown University? There's no way we're gonna be able for that. And she's like, no, there's something called financial aid, and you can get loans and all of this. And she ended up going to Brown. And that completely opened up my mind of what's possible. And to give my mom fair credit, she definitely, you know, I think South Asian culture, Indian culture, whatever you want to call it. You know, there is this very. You could call it positive or negative peer pressure of like, oh, so what are your kids doing? So and so's kid's going to med school. What? You know, someone's kid got a. Has a. Has a. Has a perfect gpa. As a valedictorian, is your kid only the salutatorian? So she kind of would often tell us stuff like, you know, you should be valedictorian, just like Thuhien. Thuhin was this kid we Knew who was 10 years older who had. I think, by the time he was 18, he had a PhD from Tulane. So, you know, it's. I think he now has two PhDs and an MD. So I remember there was a lot. I heard a lot about Thuhin.
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A
So I guess your mom was pretty happy because you wound up going to mit.
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C
And when you got there, was it just so exciting?
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B
It was for me, you know, when I got there, I was. It did feel like heaven on so many levels for me. You know, it was the first environment that I had been in that really are like, you know, you shouldn't be ashamed if you're getting excited in an organic chemistry class. I still remember one of my friends, Narendra, who I actually met in the organic chemistry class. Like, I literally saw him getting excited about what was being talked about. He was having epiphanies as we were talking about, like, the aldol reaction. And it's the closest thing to Hogwarts in the real world where, you know, science is magic. And you can walk down, you know, the main hallway in MIT is called the infinite corridor. And you're just seeing, you know, people with, like, that some of them are a little bit unusual in their effect and all of this, but they all have these magical superpowers and there's professors who are inventing things and building things, and this is right in the late 90s where the Internet and computer science was, was starting to become very relevant to society as a whole. So MIT was and I think continues to be an incredibly exciting place.
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C
You graduated MIT with a master's degree. You, like, double tripled up on classes and I guess just were insanely productive.
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And got a degree in computer science. What did you do after you graduated?
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B
Well, I remember my senior year, this was about November of my senior year. I talked to a friend who was a year older and he had just gotten a job at Oracle. And I was kind of nosy. I was like, well, how much are they paying you? And he said, $100,000. And for me at the time, I.
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A
Was like, what, your mind was blown?
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B
My mind was blown. My mom was making $16,000 a year. I had about $25,000 in debt, which at the time felt like all the money in the world. So I was getting stressed about it. And I literally, I remember thinking, like, it would be irresponsible for me not to try to make that type of money, pay off my debt, help out my family, and just get a little bit more financial security. So I remember that's when I went to my advisor and saying, I think I need to finish the master's this year. And they all thought I was a little bit crazy, but it happened and I actually ended up working at Oracle as my first job.
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A
Wow. So you, you moved to Silicon Valley.
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C
To work, to California to work for Oracle, I guess.
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B
Yeah. Moved out to the Bay Area and you get to, you know, about a year into my tenure there, it's 1999 now. We're at the peak of the dot com bubble. I remember having a conversation with a friend of mine who was on an H1B visa from India, and he said, sal, why are you here? I was like, well, you know, it's. The pay is really good. He's like, I'm here because I have to get my, I have to get my immigration. But like, you're a citizen. Like, if I were you, I'd be doing, I'd be starting a company right now. This is the late 90s. And so, yeah, I ended up joining a startup. It was a startup to, it was going to democratize venture capital. It's called mevc, where the, the idea was, you know, you had all these IPOs that were popping. So a lot of people were trying to get into the venture capital market, but obviously it was hard for people to get into it. And so these two bankers from Robertson Stevens at The time they had come up with a structure that could be a publicly traded venture capital fund. And. And so that was the startup, and it was going to have a tech aspect of it where people could see the investments, et cetera, et cetera. So that was what I was supposed to build and did build.
- [19:02]
C
It's a great idea, but still hasn't been democratized to this day. What happened to the startup?
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B
You know, while the NASDAQ was roaring, was doing quite well, it grew to 40 employees, it raised its first fund, which I think was several hundred million dollars. But then, you know, I still remember that day in, I believe it was spring of 2000 when the NASDAQ collapsed. And, you know, and with that, I saw the other side of the startup world, where, you know, every week we'd have to lay off a few folks. And it was incredibly, incredibly painful and political and stressful. And that was around the time that I was like, yeah, maybe I should take shelter someplace.
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C
Yeah.
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B
So I started looking up applications for business school.
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C
So you decide to leave Silicon Valley and the startup world for at least the time being and go to business school. You went back to Massachusetts, to Harvard Business School?
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B
Yeah.
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C
And what was the idea? Was your idea like, all right, I'll do this and then I'll go back into the startup world, or I'll go into finance and get a stable job and make a stable, good income. Did you have a sense of what you wanted to do?
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B
I mean, if I'm really honest, I was lonely. I was out in Silicon Valley. I mean, the male female ratio in Silicon Valley back then was horrendous. I also felt traumatized to a large degree by my startup experience because it was so painful and political.
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And I actually told myself that I didn't have the fortitude to be an entrepreneur, that it's just so emotionally taxing. Let me go to business school and maybe broaden my resume a little bit so people just don't perceive me as the tech guy or the quant guy. It was while I was in business school, I started taking finance classes and started seeing that, wow, there's a real beauty to finance that. It has its quantitative aspect, but it also has a huge psychological and historical aspect to it that I loved. And I remember taking a capital markets class, and that was probably the math heaviest class offered in business school. And the professor's name is George Chaco. I remember going to him after class one day. I was like, I really like this class. And he's like, yeah, you really have a knack for capital markets and things like this. I was like, well, what should I do with this? What kind of career is this for? He's like, I think you should go work at a hedge fund. And I said, wow, that sounds great. What's a hedge fund? And he explained, it's like a mutual fund, but there's a lot more flexibility in how you invest the money. You can get into exotic things. You can short, you can buy and sell options. And I talked to some friends who had worked at hedge funds or who were going to work in hedge funds and said, what's the pay like? Is it good? And they kind of looked at me like, are you crazy? It's about as good as it gets.
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C
I guess. You decided to do exactly that to get a job at a hedge fund.
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A
Was it easy to land one?
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B
No, I got, you know, my application got rejected hundreds of times, and my resume did not look like a hedge fund resume. I mean, I was getting people in tech who wanted me to be a product manager or something like that. But at that time, I had. There was a girl I had a crush on from mit. She was now in med school in New York. And so I was also like, I need to work in New York. And so I was. I literally went through the directory of any hedge fund in New York and I was. I was getting one rejection after another. And then eventually there was this guy, Dan Wohl, based in. In Boston, who was apparently kind of getting his hedge fund off the ground. And Dan at The time was 32 years old, I think, or 33 years old. And I interviewed with him and he hired me. And he later told me he hired me because I didn't have a background in finance. He liked that I seemed to be kind of a out of the box type of personality. And, you know, it was. It's one of these ironies that I had then fallen back into essentially a startup because it was me and Dan, and we were looking for office space and, you know, making sure that the office was dog friendly because he had this large dog that we had to. We had to accommodate. And so, yeah, that, that was my first job in finance.
- [23:14]
C
How'd it go? How did you do?
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B
You know, I gotta say, you know, it was a fascinating job because what we would do is we would screen the market for things that looked just intriguing and we would try to understand that business. And the best way to understand that business was try to get the management team on the phone to explain their business to us. And so it was intellectually, I was a kid in a candy shop because I was able to every day. I mean, it was kind of like being a journalist. You're able to really dive deeply into these. And my job was actually to be kind of a hyper learner because the first half of the calls, I would always say it was a little bit of like, gee whiz. So how does this work? How do logistics work and all, all that. And then the second half of the call, I would turn up the knob a little bit and I was like, what you're saying doesn't make sense.
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And push the management teams a little bit harder.
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A
And while you're doing all this, you're.
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C
Also sort of starting what would become Khan Academy. I mean, you're working there in Boston. And I guess this is around 2004. The story, I guess that I've heard.
- [24:16]
A
Is that your sister's daughter is having trouble with math. Is that, Is that sort of the story?
- [24:21]
B
It was a cousin. It was a year. I was a year out of business school, had just gotten married to the Umama, the person that I was trying to move to New York for. And the wedding was in New Jersey, which is where my wife grew up. But then family was visiting from New Orleans and they wanted to visit Boston during fourth of July. And so I was showing them around town and it just came out of conversation that my 12 year old cousin Nadia, her mother, Nazruth aunty, was telling me that she was having trouble in math. And she's like, sal, if there's anything you can do, I know you know, you're more knowledgeable about these types of things. And so I talked to Nadia and Nadia said that she was having trouble. She took a placement test at the end of sixth grade. It had a lot of unit conversion in it. She felt that she just couldn't understand unit conversion. And so I told Nadia, I'm 100% sure you're capable of learning unit conversion. How about when you go back to New Orleans, I'm happy to tutor you remotely. And she was up for it. And so that was August of 2004, when I started tutoring Nadia.
- [25:22]
C
All right, so remotely sounds fine today, like in the era of zoom and slack and stuff. But how did you do that in 2004? Was it over the phone?
- [25:32]
B
Yeah, it was over the phone. And we used Yahoo Instant messenger to type messages or to type questions. And Yahoo Instant messenger at the time had this feature called Yahoo Doodle, where you can actually, with your mouse, scribble something. And someone on the other side could see what you scribbled and you could imagine writing math equations with a mouse was pretty painful. And so I got myself and I got Nadia a, you know, like a, I think it was $60 pen tablet so that you could write, but it was on a little, little part of your instant messenger window. But that's still enough that you could write things like 3x is equal to 6, you know, what does X equal? So that's how we did it.
- [26:14]
C
And this was just something you were doing at night and you know, kind of after work.
- [26:18]
B
Yeah, I was doing it every day, about 30 minutes getting on the phone. And after, frankly a few weeks, Nadia, the first few weeks was just deprogramming her own lack of self esteem. But then after she got through that, she started to believe that she was capable of learning. Unit conversion actually came quite easily to her. Then she got caught up with her class. She came a little ahead of her class at that point. I became what I call a tiger cousin. I called up her school, I said, you know, I really think Nadia Rehman should be able to retake that placement test from last year. They said, who are you? I said, I'm her cousin. And, you know, surprisingly, they let her retake that placement test. And the same Nadia who is only a few months ago put into a remedial class was now put into an advanced math class. And I was hooked.
- [27:05]
A
When we come back, sal discovers that YouTube is not just for cat videos. Stay with us. I'm Guy Raz and you're listening to How I Built this.
- [27:19]
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- [31:17]
Hey, welcome back to How I Built this. I'm Guy raz. So it's 2004, and after a couple of months of Sal helping his cousin with her math, she gets bumped up from a remedial class to an advanced one. So what's his secret?
- [31:33]
B
I Would love to believe that I'm some type of super tutor or something, but I think the reality is that there's actually a lot of research to back this up, that if you do have one on one tutoring and that tutor is able to identify what your gaps are and fill in those gaps, especially in subjects like mathematics, that most kids can actually probably all kids could be accelerated dramatically. And, and that's all that was happening with Nadia. I mean, there was some of it was just motivational. She had almost given up on herself, so I had to just remotivate her a little bit. And I think a little bit of the secret, you know, this might sound a little bit of like a once again a tiger cousin or tiger parent thing to do, but when you get, when you allow a student to get a little ahead of their class, two things happen. One, when they see it in class, they're like, oh, I've seen this before. So they, it builds a little bit of cushion and also builds confidence. There's just, you know, once you start to realize that you can actually get a little ahead of your class, you're like, oh, maybe this is my thing. Maybe I'm a math person.
- [32:27]
C
And I guess like the word gets out around the family in Louisiana and other relatives are like, hey, can you help my kid or can you help me? Is that sort of what happened?
- [32:40]
B
Yeah, I mean, put exactly as you described, word spread that free tutoring was going on and before, you know, and I was getting requests from family members all over the country. And by 2006, I was tutoring on a given day, anywhere between five and 15 cousins, family, friends around.
- [33:01]
A
A given day?
- [33:02]
B
On a given day. Yeah, they would all get on the speakerphone together. I would answer questions they had. And, you know, one thing I saw with my cousins, the way that math is often taught and especially learned, is it's like these fragmented concepts that you have to memorize formulas and patterns and things like that. And the thing that really served me well growing up is that if you just ponder the math a little bit, it all connects. It all makes intuitive sense. It's all just a way of thinking. And so I was really trying to do what I could to support them all.
- [33:31]
C
And meantime, you were still working at a hedge fund, right?
- [33:35]
B
I was. And I have to give extra credit to Dan because in the early days when I was working for Wool Capital, Dan's startup hedge fund, it was just me and him. I had bought into the stereotype that you have to work 80 hours a week to make it in finance. So I was ready to do that. And I remember this is probably a month or two into starting my job. Dan's like, why are you still here? Why aren't you going home? I was like, no, no, Dan, I'm ready to, you know, I'm gonna look for more investment ideas. He's like, no, no, go home. I was like, okay. I was like, okay, I'll go home and I'll look for investment ideas. He's like, no, sa. You're not going to help anybody by just, you know, having the appearance of motion. It's not about just churning yourself and tying yourself out, because then you're just more likely to make bad decisions. Our whole goal is to avoid bad decisions. And the best way to do that is when you're at work, you know, have your game face on, have your game energy. But to do that, you're going to have to have other things in your life. You should read interesting books, you know, recharge. And actually that recharging is going to keep your mind open and keep you creative and not fall into the groupthink that a lot of people do. And so Dan kind of forced me to have a life, and that's what gave me the space in my life to offer to Nadia say, yeah, you know, after markets close, I'm actually pretty free to work with you.
- [34:53]
C
So you're doing this, tutoring these kids, and it's over the phone, and this is like, around 2006, and somebody suggests that you make videos and you put it on YouTube. Did that happen around that time?
- [35:07]
B
Yeah, actually, even before the videos happened in around late 2005. You know, I have this background in software, and in the back of my mind, I have always been fascinated by can software play a role in improving human potential? And when I was in college, almost every job I did was in some way related to education or how tech and education could be useful. I remember I worked for some Spanish professors to help teach people Spanish. Then the next summer, I worked on some software to help kids with attention deficit disorder learn math. And I created this little thing called mathplanet. So my brain was there throughout for a long time. And so when I started working with my cousins, I was like, wow, it's hard for me to find good practice problems for them on the Internet. Let me write some software for them that could generate practice problems and that. That can give them hints and solutions and immediate feedback and that could give me, as their tutor, data on how they're performing and how long things are Taking them. And I wrote it as a hobby and that was the first Khan Academy. I set it up as a website.
- [36:15]
C
And it was not very expensive. Presumably you just kind of did it yourself and offered it to these kids.
- [36:23]
B
Yeah. And I remember a lot of my friends was like, well, is this a business? I was like, no, no, no, not a business. I'm not a startup guy. I'll never do.
- [36:31]
This is my family project. That was my way of frankly protecting it emotionally. And I was at a dinner party and my friend, his name's Zulli, Zulli Ramzan. Give him full credit. He's like, well, this is cool, Sal, but how are you scaling your actual lessons? And I said, you're right, Zulli. It's hard to do with 10 cousins what I was originally doing with just Nadia and her brothers. And he says, well, why don't you record some of your lessons as videos and upload them onto YouTube for your family? And I immediately, you know, my technologist side said, well, that's such a low tech solution. And then I, I vocalized him. I was like, no, that's like YouTube's for cats playing piano. It's for dogs on the skateboard. It's not for learning. And I went home that weekend and I, I think I probably had explained least common multiple to a cousin for like the eighth time. And I was like, maybe Zulu's got a point. Maybe I should make a video on least common multiples for my cousins. And, and then it was just a, how do I make the video? You know, back in 2006, cell phones weren't particularly good. I didn't have a video camera. And, and I, you know, you do Google search, you realize, oh, there's something called screen capture software. And so I downloaded some, you know, free screen capture software and I started just essentially recording some of my digital scribbles using my pen tablet. Yeah, but you can hear my voiceover while I'm talking. Yeah, and it was, they were done very extemporaneously, you know, they're from my cousins. And I started uploading them onto YouTube and telling them, watch this at your own time and pace. And then we can dig deeper when we get on the phone. And after about a month, I asked them for feedback and they famously told me they liked me better on YouTube than in person.
- [38:04]
A
Really?
- [38:05]
B
Yes, they just really liked having an on demand version of their cousin that they could watch as much as they want. There was no shame in reviewing a concept that they should have learned in fourth grade. And I started to realize, you know, this, this type of thing, especially math. And I was doing math and I started doing some physics and chemistry and biology as well. It's pretty evergreen content. If once you have a good explanation of adding fractions with unlike denominators, pretty much everyone in the world could use it. And you don't really have to refresh it unless you figure out a better way of explaining adding fractions with unlike unlike denominators.
- [38:39]
C
I mean, I'm trying to figure out how you were thinking about this because, I mean, clearly you were motivated to help your relatives and these kids in your extended family and friends of friends. But I have to think that a part of you was like, maybe there's something bigger here or were you just not even thinking that at all?
- [39:01]
B
Oh, there was for sure something. My brain oscillates between these mega delusional.
- [39:09]
Space opera science fiction ideas and like Sal, you're being crazy. Focus on what you can do in the here and now. And so the reason why I was always fascinated by software, technology and education is that it's not hard to imagine that if you make something that can increase human potential by 10%, 20% or 100%, and if it scales like technology can, there's no reason why it can't affect all of humanity one day. And, and I was super inspired when I was young. In seventh grade, I read the foundation series, Isaac Asimov. And the protagonist is someone named Harry Seldon, who's kind of a new form of academic that's a combination of mathematics, economics, history, psychology. And he's able to predict large scale historical movements. And he sees through his science that the Galactic Empire is about to enter into a 10,000 year dark ages. And he decides to do something about it. He can't stop it from happening, but he can shorten it to a thousand years. And the way he does that is by taking the galaxy's knowledge and putting it into a foundation at the periphery of the galaxy. And I remember when I was seventh grade and I read that I thought two things. One, why don't more people think on those scales like that? It feels so inspiring and epic to think on that scale well beyond ourselves, you know, and when I went into the hedge fund world, I realized most people don't even think beyond the next earnings period, much less generational or over centuries or over thousands of years. And then the other Aha. From that book in seventh grade was like, yeah, Harry Seldon's right. Like the way to preserve civilization is really through knowledge. It like that is what defines a civilization. That is what defines human potential. And so, you know, while I was working this in 2000, 2006 and now 2007, and I started getting thank you letters from folks around the world, you know, people who are soldiers in Iraq saying, I'm using your content while I'm. While I'm in Iraq to prepare for college so I can go back to college. People who dropped out of high school. I was like, maybe, maybe this project could be like the foundation. It could be this thing that keeps us from going into dark ages or maybe entering into a new age, who knows?
- [41:20]
A
Yeah.
- [41:20]
C
I mean, that's what I'm wondering. When you started putting these videos out on YouTube, on the Internet, would you like wake up and see like 200 views and then 600 views the next day?
- [41:29]
B
Yeah, that's pretty accurate. That's about what I.
- [41:32]
A
Were you surprised?
- [41:32]
C
Were you like, what is going on? Who's watching this?
- [41:36]
B
I was hoping that something like that would happen. I mean, when I put it on YouTube and it asked whether I want to make it public, I was like, yeah, I guess it would be pretty cool if other people could benefit from this. But then when you start getting not just the views, but for, I would say the comments, especially people opening up on the YouTube message boards or opening up on. They can do the private messaging on YouTube and they'll tell you their life story and how that one video unlocked their perspective. I'm like, oh my God.
- [42:04]
For that person, that video is a big deal. And I didn't really have to do anything extra for that person. It's really inspiring. And I just got more and more hooked on it.
- [42:14]
A
Meanwhile, as you mentioned, you're still with Dan at this point at the hedge fund.
- [42:19]
C
And then I guess at some point he decides to move the fund to California, right?
- [42:25]
B
Yeah. We had moved out to Silicon Valley. Dan's wife had become a professor at Stanford, which is why we had moved out here. And so my wife was able to finish her fourth year at med school doing a bunch of rotations out here in the Bay Area. So we, you know, and now that we were on the West Coast, I was working from 5am till about 2 in the afternoon. So before our first child was born, I had a lot of time on my hands. So I was spending about that four hours, four to five hours that I was spending after work. I was spending about half of it making videos and about half of it continuing to write code, write that software, that practice software for my family, that other people were now using. And by 2007, 2008, it was in the tens of thousands of people. And by 2009, it was in and the hundreds of thousands of people were using it on a regular basis.
- [43:15]
C
At what point did you say to yourself, I think I want to do this. I think I want to do this full time. I think I actually want to turn this into something.
- [43:24]
B
There were many moments you could imagine in the investing world. You have your share of not so great days. You're like, maybe this is not what I should do. Maybe I should be this virtual tutor. And then you're like, okay, stop dreaming, Sal. Look, you got to pay off your debt, pay off your mortgage, et cetera, et cetera. So I had multiple cycles of that over the years. People in Silicon Valley, they do understand. Quitting your job, some Angel Investor writes $100,000 check and you're off to the races. But I did incorporate it as a not for profit in 2008 to protect.
- [43:54]
C
It from the get go. You said, this is going to be a nonprofit even before you decided to make this your full time job.
- [44:02]
B
In my mind, it was initially an emotional thing to do, which I was getting these letters from folks saying how it helped them, and that was such a precious thing, people's trust in me, that I never wanted them to even suspect that I'm doing it for any other reason. Now, look, there's a lot of for profits in many industries that do incredible things. And even in education, there's for profits that do good things. You know, obviously I was working at a hedge fund. I believe in capitalism, I believe in markets. But while I was at a hedge fund, I saw how much capital structure and incentives can really drive what an organization does. And yeah, and the only organizations that really do stay true to some social bottom line over long periods of time are non profits. Yeah, I did have some folks who are reaching out to me by 2008, saying, hey, our kids have been using your stuff. We think it's great. We think this is going to be the next big play in ed tech. Yeah, can I write a check and we'll start this thing?
- [45:04]
A
I'm sure.
- [45:04]
B
And it was tempting.
- [45:06]
C
Yeah.
- [45:07]
B
But then by the second conversation, it was always like, okay, we'll give this stuff for free, hook people, and then you have the freemium content, we'll sell it.
- [45:15]
C
Yeah, right.
- [45:15]
B
And, and that just felt a little, you know, queasy to, to me. So, so, but even when I set it up as a non profit, I said, you know, I'm not going to quit my day job. I have a great day job. You know, this hedge fund thing, I can, can, I can make a lot of money. What I can do as a nonprofit is maybe get other volunteers who want to help. Maybe if we get some philanthropy, maybe I can help hire other people. And maybe if, you know, if I could be on a trajectory like Dan was, you know, Dan, if he kept at it, could have easily become, you know, the next Warren, Warren Buffett. But, you know, he decided to kind of pseudo retire at 40 to focus on his family, when if he kept going, he could have easily become a multi, multibillionaire.
- [45:55]
C
Wow.
- [45:55]
B
And I'm like, maybe I can retire early and be, you know, reasonably well off so that, that I could, I could do this at that point.
- [46:04]
C
So what, how did you decide to leave that relatively secure and stable? Not stable, but, you know, this, this path towards immense riches and jump into this full time. What, what happened? What was the catalyst?
- [46:22]
B
There's this guy, Jeremiah Hennessy, who's the founder of BJ's restaurants. He got my email address and emailed me and I was like, oh, this guy runs a large restaurant chain. Publicly traded. Yeah, it seems legitimate. I should talk to him. And I started having these therapy conversations with him almost on a weekly basis. And he would just keep calling me and say, sal, your purpose in life is not to, to be a hedge fund investor. I'm sure you're good at it, but that's not your purpose in life. You don't realize the content you've made. What it's done for my own family, what it could do for the world, you need to be doing this. And he's like, there's got to be some way that someone will fund this as a nonprofit. The impact on the world could be so huge. When a legitimate person tells you that this is a legitimate thing to do, you start saying, maybe. But then you go home, you look at your son was born in February of 2009, and I'm like, okay, I have another mouth to feed.
- [47:19]
We were renting a house. The rent had gone up because we had to move to a larger house. My mother in law had moved in with us as well. I'm like, there's no way I could do this right now.
- [47:28]
C
You were not a millionaire.
- [47:30]
B
I was not a millionaire.
- [47:31]
C
Yeah.
- [47:32]
B
And then by fall of 2009, there were several hundred thousand folks who were using the stuff I was making on a regular basis. I got a call from the local tech museum. They had this annual award ceremony which is a pretty high profile thing called the Tech Awards. And they called, they said, you've been nominated. One of three entities nominated to win this year's tech award. And I was like, wow. And so I was getting that validation that like, well, people are starting to take notice of this thing. And then CNN had called at around the exact same time. I mean, if everyone remembers the context, the market was falling apart. And it turns out I had made videos on, not just on math and science, I actually had made videos explaining the stock market and videos explaining what mortgage backed securities were and credit default swaps and collateralized debt obligations. And I started getting media houses contacting me saying, we are watching your explanations before reporting on the financial crisis.
- [48:29]
A
Wow.
- [48:30]
B
And we think they're the best explanations out there. And then I remember Rick Sanchez on CNN reached out to me, says, I want you to come onto my show for 20 minutes and explain the financial crisis to America. So I'm like, wow, like people are paying attention. So that was like my first signs from the universe that maybe this is what I should be doing.
- [48:53]
C
Your wife, I think was not yet a doctor. She was still in residency or maybe.
- [48:58]
B
She was a. Yeah, she was in fellowship.
- [49:00]
C
At this point when you said, hey, I'm going to leave finance and do this, was she nervous? I mean, was she like, sal, like it's great, but I mean, we don't have enough cash. Or did she say, okay, do it, but just for a short period of time?
- [49:19]
B
Yeah, it was a process, you know. And you know, look, every marriage there's, I would call it moods or weather to the marriage. And you know, if I caught her at a bad moment, it'd be like, I just get a weird look. But if I caught her at a good moment, she'd be like, no, you know, look like I. You've been showing me these letters you've been getting. They are incredible. And it does seem like you're on to something. But, but, but then, you know, let's look at our finances and we would look at it, you know, our rent, you know, to rent a four bedroom house out here. At the time it seemed like a lot. It was $4,000 a month. We were, you know, she was making probably $40,000 a year as a, as a fellow.
- [49:56]
A
Yeah.
- [49:58]
B
My mother in law was living with us. We had a child, we were hoping to have more children. Our expenses were only going higher. So she saw that I was having trouble focusing on anything else. That down payment we were saving, we said, okay, maybe we can dig into that. For a little bit, for a year. I also say that a couple of philanthropists had reached out and said, we're interested in what you're doing. And so. So I was like, oh, surely one of these people will fund it.
- [50:30]
C
And we're off to the races, right?
- [50:31]
B
And we're off to the races.
- [50:31]
C
It'll be a million bucks, and we're good to go.
- [50:33]
B
That's it. Exactly. So I quit the job, and then it doesn't work out that way.
- [50:38]
C
All right, so you jump into this with both feet. And did the money start to come in immediately? Did you start to get donors sending you checks?
- [50:48]
B
Kind of.
- [50:50]
Those early funders who seemed promising by conversation four or five, I started getting, well, this is really exciting, but it doesn't really fit in our portfolio. Our budgets are already allocated. You go several months into it. I did have this little donate button on my website, and there were people starting to donate. It was amounting to a few hundred dollars every month. If it was anyone listening, thank you for that. But we were digging into our savings, about 5,000 or $6,000 a month. Month. So it was incredibly stressful. And, you know, but my male ego was trying to shelter my family from it, so I was putting on a strong face to my friends and family. And you can imagine my mother, who, when I told her I'd quit my job, I still remember her first word was what? Literally.
- [51:39]
In that tone, because as we talked about, I had now fallen into a really lucrative career. And then to give that up and to do that for something that was, like, not something that she could tell her friends at the next Indian party.
- [51:55]
Not only was there a monetary aspect to it, there was probably a shame aspect to this as well. That was hard.
- [52:04]
C
Love your mom.
- [52:07]
A
Yeah, no, right.
- [52:08]
C
I mean, she came to the United States with nothing and really kind of was scraping by most of her career, and. And her son goes to MIT and then Harvard Business School, and now he's calling mom and saying, yeah, I'm gonna do this nonprofit thing.
- [52:27]
B
Yeah. That no one has funded. This nonprofit thing that no one has funded. And I'm living off of savings. Would you like to see your grandchild that I really can't support?
- [52:38]
We'd go to gatherings, and.
- [52:41]
I remember at one party, and they kind of asked, what? What, What? What I do for a living? And I said, well, you know, I used to do this, but, you know, now I do this thing where I make math videos and I write the software as a nonprofit. And, you know, and they're asking all These questions, how is it funded? What's the model? I was like, yeah, I'm still working on that, still figuring it out. And I remember when they were walking away, I mean, they literally said this, like, well, you know, he's lucky that his wife is a physician, you know, and it's like this. It's like a punch to the gut of your, like, fragile male ego. It's like, no, I can support my family, too. You. You wait, you eat.
- [53:17]
A
When we come back in just a moment, how Sal gets his first big donation for Khan Academy and how he eventually winds up having a slightly surreal meeting with Bill Gates. Stay with us. I'm Guy Raz, and you're listening to How I built this.
- [53:41]
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- [55:47]
Hey, welcome back to How I built this.
- [55:49]
C
I'm Guy raz.
- [55:50]
A
So it's 2009 and Sal has just left his high paying job at a hedge fund to focus on Khan Academy full time. And since it's just him, no other coders, no other teachers, this new venture is not costing him a lot of money. But what is costing him is the fact that he's no longer making any money.
- [56:14]
B
You know, the first three months you're euphoric, you're, you know, you're super excited about your new lifestyle as this non profit do gooder and all of that.
- [56:23]
I would say by month, month, seven or eight. I couldn't sleep. I, I mean I literally couldn't sleep. I, I, Anxiety. I was, yeah, I was getting anxious. I was waking up in the middle of the night in cold sweats. I was, you know, I would, I would look at my bank account over and over again and look at, you know, look at our expenses. I would run financial models for my family, you know, and my wife would say, oh, what do you. I was like, oh, nothing, you know, like, I mean, in hindsight I was like, I shouldn't have been so kept it just to myself. But I was in a really bad place mentally and the stress and the anxiety was killing me.
- [57:00]
C
Was there also that kind of maybe residual fear of failing?
- [57:05]
B
Yeah, I think there's, we talked a lot about childhood and not having a lot of resources growing up and I frankly still have a fear of being one catastrophe away from financial hardship. And in 2009 I was like, I made the catastrophe happen.
- [57:26]
It wasn't like a hurricane or something that's ruined our finances, not a fire. It's like I quit a good job. And the type of job that I had is not easy to get. And I would try to channel whatever nervous energy or anxiety I had into the work. I was like, let me make more videos.
- [57:47]
Let me make more content, let me write more code and, and hope that eventually someone will notice.
- [57:53]
C
I guess maybe it was kind of a low point that you hit and a wealthy, very wealthy person reached out to you. This is Ann Doar, the wife of John Doar, the billionaire venture capitalist. Kind of reached out to make a donation. What was the story?
- [58:14]
B
I have this theory that benevolent aliens are helping me so that Khan Academy can help prepare humanity for first contact. And you know, the, andor coming into my life. And then, you know, what happened shortly afterwards. It was May of 2010 and you know, I was getting these donations off of PayPal, you know, people donating ten dollars, twenty dollars every now and then a fifty dollar donation would come in. That was pretty exciting. And then I saw a $10,000 donation come in.
- [58:43]
C
I was like, came in through the site.
- [58:44]
A
Just $10,000. Just like that?
- [58:47]
B
Yeah, it was, I mean, just like I got an email notification from like PayPal that a donation has come in. I was like, oh, is this going to be a 50? I was like, oh, it's a 10,000. And then, you know, I immediately did a Google search and I was like, oh, wow. Like Ann Doerr, she's like a real philanthropist. And I immediately emailed her and I said, you know, thank you so much for this incredibly generous donation. This is the largest donation that Khan Academy has ever received. I tried to project like I'm a real institution and if we were a physical school, you would not have a building name named after. And, and Ann immediately emails back and says, well, you know, I didn't realize that you, you weren't getting this kind of donations.
- [59:31]
I see that you're based in Mountain View. You know, I've been using your stuff with my daughters, I've been using it even myself to understand the financial crisis and, and accounting and finance. If you have time, I would love to grab lunch, lunch with you. And you know, I was like, yeah, absolutely. And so a week later, maybe a few days later, we were in downtown Palo Alto at an Indian buffet restaurant. She asks me over lunch. So what, what, what's your goal here? And I told her when I filled out the paperwork with the IRS to become a non profit, that little part of the form with like mission colon and they give you a line and a half. I filled out a free world class education for anyone anywhere. And she looked at me, she's like, well that's ambitious. How do you see yourself doing that? And I told her, you know, to be very clear, that's a mission. I don't think I'm just going to be able to check it off this weekend and then move on to healthcare or something. But I showed her, you know, she was already familiar with the content I was making. I showed her the exercise, the software platform I was making. I said, look, videos are nice and I want to keep making videos. I really enjoy that. I want to translate into the languages of the world. But the real learning happens when students are able to work on exercises, get immediate feedback. Ideally, teachers and parents can get dashboards to understand where their kids are and how to do more interventions. You know, I by this point been rejected by so many major foundations, probably about 20 of them. So, but, but in Preparation for all of them. I had a binder of. Of testimonials from around the world. I mean, it was literally several hundreds of pages through thick and, you know, these letters. So I showed it to her. I showed her how the. The usage was growing exponentially. And I was like, you know, I think this could eventually reach, like, all of humanity. And she's like, well, you. You've made a lot of progress. How? I only have one question. How are you supporting yourself? Yeah. And as proud of a way as possible. I said, I'm not. And.
- [61:27]
She kind of processes that because.
- [61:30]
A
She'S thinking you're a big shot.
- [61:32]
C
You're, like, doing TV interviews, and.
- [61:36]
Hundreds of thousands of people using this.
- [61:38]
A
Like, Right?
- [61:39]
B
Yeah. No, I mean, I had been on cnn, and I didn't realize there was actually. There was a buzz about Khan Academy in Silicon Valley at the time that I didn't know about. No one. They weren't. I wasn't in the know. I wasn't even in the right circles to be experiencing the buzz. And so anyway, you know, she. She offered to pay the bill, and I said, oh, if you insist.
- [62:00]
And 10 minutes later, I'm driving into my driveway, and I get a text message from Ann, and it says, you really need to be supporting yourself. I've just wired you $100,000.
- [62:12]
A
Wow.
- [62:14]
B
That was just, you know, it's like one of those moments where you just, like, stare at the phone and you sit in your driveway for the next half an hour.
- [62:20]
A
Wow.
- [62:22]
B
Like, you know, holy crap. I mean, I. I think I was. I might have cried, you know, like, it was that type of. Because you. You know, all that stress that builds up over the months, all of a sudden it just gets released, you know, and it's not. That hundred thousand was all of a sudden gonna, like, change everything forever, but it's like, okay, I can now pay my bills. We're not gonna have to dip into savings. You know, it made. It gave. Like, I can do this for a few more months, for a year at least, or maybe even a little longer.
- [62:52]
C
So she wires you $100,000 check. And I guess that same year, 2010, the Aspen ideas Festival happens, and Bill Gates is there, and he's telling the audience that he uses this thing called Khan Academy. How did you find out about. About Bill Gates mentioning you at Aspen?
- [63:15]
B
So I start getting text messages from Ann, which you can imagine I now take very seriously. And she. There were four or five of them, and they were kind of cryptic, as text messages often are, and they Said, this is Ann writing. I'm at the Aspen Ideas Festival, main pavilion. Walter Isaacson interviewing Bill Gates. Gates, last five minutes, talking about Khan Academy. Me.
- [63:39]
A
Wow.
- [63:40]
B
And once again, I just kind of stared. I was like, what is she talking about? And I start doing a web search for, you know, aspen Gates, Khan Academy. After about 10 minutes, I actually found, like, the delayed recording of the interview. And Walter Isaacson asks bill Gates, what are you excited about right now?
- [64:01]
A
Yeah.
- [64:02]
B
He didn't even say it in education. And he says, well, there's this one guy. I think his name is Sal Khan, and he's created this thing called Khan Academy. I've been using it with my kids. I've been using it myself, and it's really great. And it was clear, not only was he using it, but he was eerily familiar with my story. He's like, yeah, this one guy, his wife let him quit his job. He was making stuff for his cousins.
- [64:26]
It's just one of those moments where you're just like, is this really happening?
- [64:30]
C
Did you have any idea that Bill Gates was using this with his children?
- [64:34]
B
I had no idea at all. I mean.
- [64:39]
It definitely gelled with some of the delusions that I've had over time, but.
- [64:45]
I had no clue. And I remember that night I went home. I immediately showed my wife the video when she got home from her fellowship, and we both kind of stared at each other a little bit, and I was just like, what do I do now? You know.
- [65:02]
Do I call him? How do I contact? I'm sure he's not listed.
- [65:06]
C
Yeah, how do you contact Bill Gates?
- [65:08]
B
It wasn't obvious. And.
- [65:12]
Simultaneously, a reporter from Fortune had reached out, actually before this happened, saying, oh, you know, there's this thing you're doing. It's really interesting. We'd like to do a story about it. And so I was already talking to the reporter, and that reporter call, and he's like, did you know that Bill Gates uses Khan Academy? I was like, I had no idea. And then the reporter, Robert Kaplan with Fortune, he says, I'm gonna call Bill up. I'm like, if you think you can call Bill up and do that. And so he calls me, like, two days later. He's like, bill took my call. I just interviewed Bill Gates about you. And it's like this really surreal thing, because this person that's obviously like a lifetime hero, like, you know, you grow up in computer science reading about Bill Gates. And then the Fortune article came out, and I still had not met Bill yet or even had any contact with them. And the article said something like, the title was Bill Gates Favorite Teacher.
- [66:06]
A
Wow.
- [66:08]
B
The press sometimes writes these hyperbolic headlines, and I almost felt insecure. I was like, am I his favorite teacher? Did he say that? Are they misrepresenting? I felt serious imposter syndrome. And then I got a call. My cell phone rings right when I'm recording a video. So. And I answer, I say, hello, And I hear, you know, this is Larry Cohen. I'm Bill Gates, Chief of staff. You might have heard that Bill's a fan. And I was like, yeah, I heard that.
- [66:33]
And if you're. If you're free over the next couple of weeks, we'd love to fly you up to Seattle and learn more about what you're doing and maybe ways we could work together. And I was looking at my calendar for the month. It was completely blank. And so I said, yeah, maybe next Wednesday. You know, I've got to cut my nails, do some laundry. I'm happy to meet. Happy, happy to meet with Bill, can make that work. So, yeah, I flew up and. And. And. And we had that meeting.
- [67:00]
C
What was that like?
- [67:01]
B
And it was a little bit awkward. There wasn't like an obvious, like, oh, you know, I love what you're doing. Tell me. It was like, oh, so, you know, there was a little bit of a prompt. I think Larry might have said, oh, so tell Bill what you're up to. And. And then I just started into. Into. I had my. I had my laminated slides.
- [67:19]
And with me, I love it.
- [67:20]
C
You didn't bring a laptop. You brought laminated slides. I love that.
- [67:24]
B
I mean, there's an irony to it that, you know, I'm obviously someone involved in technology. Khan Academy is based on technology. I'm presenting to the creator of PowerPoint. So, yeah, I went through it, and at the end, you know, he didn't give, during the presentation, a lot of feedback, so I just kind of kept going. And it's one of those moments where, you know, 20% of your brain is trying to. To do what it needs to do. And then the other 80% of your brain's saying, you're talking to Bill Gates. That's Bill Gates. He's three feet away. Don't mess this up, Sal. Don't mess this up. You're about to mess this up. Don't mess this up. And then when I was kind of done, he. He kind of nods. He's like, yeah, no, this makes a ton of sense. This is great. This is great. And I'm like, oh, my God. This, you know, and, and, and then I got overconfident. I, I remember I throw out another idea. He's like, no, that doesn't make sense. I was like, oh, yeah, yeah, you're right.
- [68:14]
A
Wow.
- [68:15]
C
But was there any like, and here's a plan on how we could collaborate. Was there any of that at all?
- [68:21]
B
No, they asked, they, they, Bill said, well, what would you do with more resources? And you know, I was like, this is the question I have to answer really well. And I said, look, you know, it's just me in a closet right now. With more resources, we could translate this to the languages of the world. We could build out the software platform so more people can access it. We could build tools for teachers. And I said, I think we're reaching hundreds of thousands now. I think we could reach a million folks by the end of this year, and it could be 10 or 100 million by the end of the decade. They said, well, what would you need for that? And I said, look, if I could hire up about 5, 6 engineers and educators and content folks, I think we'll be up and running. So fully loaded costs in Silicon Valley, that'd be a million, million and a half dollars a year. And so they said, yeah, we'll think about that. That seems reasonable. And then a few days later they said, yeah, they feel that they could do that. So I started talking to the Gates foundation about that grant. And simultaneously folks from Google had reached out. Google had made this promise in 2008, which was the 10 year anniversary of Google, that it would donate $10 million to five projects that had the potential to change the world. And they determined that one of those projects has to be a project that has a chance to educate the world. And they, on their own said, we've done a lot of research and we think what you are doing has the best chance of helping to educate the world. I was like, okay, well, I'm glad you've been listening in on my delusions. And by fall of 2010, both the Google and the Gates foundation each gave about $2 million. Wow. Wow. So we had a $4 million initial funding for that first two years to hire up a team, internationalize, and start scaling Khan Academy.
- [70:10]
A
Wow.
- [70:11]
C
More than $4 million.
- [70:12]
B
Yeah.
- [70:14]
C
So now you've got to grow, you've got to build, you've got to get office space, you've got to hire people, you've got to really turn this thing that was just you into a thing. So what did you do? I mean, that's kind of overwhelming.
- [70:30]
Right. I mean, isn't it?
- [70:32]
B
Yeah, it was. I mean, I immediately call.
- [70:37]
One of my closest friends, Shantanu Sinha. He was someone I first met actually in Louisiana. He beat me at a Math competition in 10th grade, and then we were on the same team representing Louisiana at National Academic Games. So that's how I got to know him. He ended up becoming my roommate freshman year at mit. So, you know, we're. We're pretty much like brothers. And I. I said, hey, Shantanu, I need help. Like, I know this wasn't on your career path to start to help me kind of get this thing off the ground, but, like, I need your help and I think it'll be fun. And, you know, he took a couple of days to think about it, and he decided to take the plunge with me. And so he quit his McKinsey job and joined Khan Academy as the president and COO to essentially help me turn into a real organization. At the same time, there were these two engineers. I mean, it's once again, it's really eerie how these people came out of the woodwork, these two engineers. That summer, Ben Kamins and Jason Rosoph, they had volunteered for Khan Academy, and I just assumed they were some young kids who were looking for some experience. But when they were volunteering, I'm like, these guys are incredible. Like, these are some of the best engineers and designers I've ever worked with in my life. Who are they? And then I realized they're actually like known figures. They were like, you know, really well known engineers and designers. And so they were. Shantun, my next call, who said, hey, would you guys want to work full time for Khan Academy? I think we're going to get funding. And they, After a few months, we were able to convince them they worked initially remotely from New York, but then they were able to. To move out to the back area.
- [72:14]
C
So as you began to grow and scale and hire more people, I'm assuming you kind of wanted to professionalize it a little bit more and maybe kind of start to replace some of those early screen capture videos that you'd made in 2006 and 7.
- [72:31]
B
Yeah, you know the interesting. There's a constant tension as an organization grows of how do you make sure you do what's right from a professionalization point of view, from a scaling, from a managerial point of view, but how do you make sure that you're not just doing the things that everyone else does that ends up creating these large bureaucratic organizations that, you know, aren't always the most Innovative. And how do you make sure you don't lose whatever secret sauce you had that made you a success initially? And a lot of Khan Academy's, I can say, not so secret sauce, I believe, was its eccentricity, its quirkiness, its informality, coupled with its depth and intuition and, and desire to show the wonder in the universe and the curiosity. So the last 10 years for me have just been how do I balance that? Can I bring in other people who also complement us? But we do not lose that entrepreneurial, that creativity, that curiosity, that eccentricity, that quirkiness that made Khan Academy what it is.
- [73:32]
C
Yeah.
- [73:34]
I interviewed the founders of Headspace, which is a different. Obviously it's a for profit company, it's a meditation app. But initially all the meditations were Andy. Andy Puddicomb, if you're familiar with it.
- [73:46]
B
I'm very familiar with it. Right.
- [73:47]
C
And initially all the videos were Sal Khan, but Sal Khan is not scalable. You cannot make tens of thousands of videos. Was that clear to you pretty soon after the funding started to come in, that you needed to get other people to make videos to your standards?
- [74:07]
B
Now, you know, we don't have a lot of folks making videos. I still make a lot of them. I pretty much make all of the math and science video. And then we have a few other folks who are doing some history videos and some language arts videos.
- [74:19]
C
Yeah.
- [74:20]
B
And one of the reasons why we became a little sensitive of like, not just outsourcing it to 500 folks is we got a lot of feedback that, you know, education, even when it's done in this kind of distance way or asynchronous, you have to really trust your teacher. You have to trust that they're going to get me to someplace that I know is going to be insightful and there's going to be an aha moment that you're willing to invest in it. And we've had moments where, you know, there's a video from me, a video from me, and then there's a video from someone else. And just, even though they might be explaining that better than I could have, it could be dissonant for the student where they're feeling, wait, I really got connected that my teacher and now a substitute showed up. So what we've been trying to of balance that.
- [75:01]
C
It's amazing. I, I met David Coleman a couple years ago, the, the head of the College Board, and he talked about the partnership that they did with Khan Academy, where you offer free SAT prep, which it essentially really had a pretty big impact on the for profit SAT prep industry, because you're essentially offering this product and service for free.
- [75:24]
B
Yeah, you know, it's. I think all of these players, they're trying to do what they can in the context that they're doing it. But David Coleman reached out and it was really, I think David's brainchild when he took over the College Board that, you know, the College Board, the folks who administer the SAT and the AP exams, you know, it was. The College Board was a non for profit that came into existence to try to level the playing field that, you know, a hundred years ago the only kids who were getting into Ivy League schools were kids of legacy kids who prep schools, went to the right schools. Exactly. And the notion of the SAT is let's give a chance for the kid in Metairie, Louisiana to compete with the kids from Andover or Choate or Deerfield. But over time, as we know, this whole industry, this billion dollar industry came up around what looked like creating a perceived and maybe actual advantage for the upper middle class or affluent. David said, look, we've been secretly observing Khan Academy and what we really like about, about Khan Academy is y' all are about really learning the material. I had actually made some SAT videos for Nadia and my cousins. I actually went through the SAT practice book and I did every problem in the book on video for my cousins so that it was a 400 something problems. And I was afraid that the College Board was going to sue me because I didn't take their permission to like screen capture their problems. But Dave is like, I watched that and what I really liked about it is at no point did you say, oh, this is how you guess. You always said, oh, this is a concept you need to learn to be ready for college. This is where you learn it. This is how you learn it. There was a little bit of test taking strategies. He's like, that's what test prep should be. It should be something that genuinely makes you better, genuinely makes you more prepared for college. And how you perform the SAT is just going to be a byproduct of that. So he said, how about we partner to create the world's best test prep that happens to be free. And it made sense to me. And over time the relationship has evolved where they actually pay us resources to create free test prep, which is, you know, that's the type of revenue I love because it helps sustain us. But it's free to the student.
- [77:29]
A
Yeah.
- [77:31]
C
I think the last time I checked, it's more than this.
- [77:34]
A
Now.
- [77:35]
C
Khan Academy videos have been viewed like almost 2 billion times, which is insane.
- [77:43]
I have to imagine, Sal, over the last few years as the kind of ed tech sector has exploded, right? And lots of schools buy these programs, Dreambox and other for profit programs that are available to help children with math and other language skills, et cetera. I mean, I'm sure people came to you and said, Sal, let's spin off a for profit channel here.
- [78:06]
A
You've got something big here.
- [78:07]
C
You know, there's, there's there, you know, and, and then you won't have to worry about raising money for, for Khan Academy. You know, you can still do that.
- [78:13]
A
But let's, let's do that.
- [78:15]
C
I mean, that must have happened. That must still happen.
- [78:19]
B
You know. Yeah, we do. Oftentimes. You know, sometimes I'll go to a potential philanthropist and they're like, well, I'd rather invest than donate, you know, something like that. And you know, people, I think there's some creative ideas that I would entertain. They're like, well, you know, Khan Academy's brand is so valuable. Well, you know, what if we could take that brand and do it in this tangential space as you know, and Khan Academy can have equity and maybe they can help build an endowment for, you know, and I'm always open to ideas, but what I always remind myself and look, I'm not someone who has transcended, you know, material desires. I try to transcend material desires, but I'm, you know, I, I every now and then go to a friend who's, you know, done well with their IPO or something and they've, they got the new Tesla or they're living in a, you know, they're living slightly upstream the income gradient in our neighborhood. You know, they're a little higher up the hill.
- [79:11]
But, but I remind myself one, I consider myself incredibly fortunate to be able to do what I, I am doing. And you know, the way I think about it is I've done my philanthropy in reverse order and it, you know, I could have stayed in the hedge fund world and, you know, maybe one day become a multi, multimillionaire or, or larger. And then, but then what would I have done with that Monday? You know, I'm not someone who, who wants that much. You know, I want to be able to, you know, have, have a backyard, be able to, you know, support the family, you know, go on a vacation once or twice a year.
- [79:40]
A
Right.
- [79:40]
B
And, and anything above that, if I did become a billionaire, I frankly would have donated it to an effort like Khan Academy. So you might as well just Cut out the middleman or, you know, just time shift it and, and work on it. And, and I do generally think that it has benefited the mission and the vision, because once people hopefully are viewing it as an institution, they're rooting for it because they realize that it doesn't have an ulterior motive.
- [80:06]
C
Out of everybody I've had on the show over the past four years that you are most like is Jimmy Wales. Jimmy Wales has had an incredibly enormous influence on the world with Wikipedia. Had they done this as a for profit, he could have been a multimillionaire. His argument was it wouldn't have worked. You had to make it a nonprofit. And by the way, he said, look, I don't really care about having lots of money. I have a really interesting life. I get to meet really interesting people. Interesting people want to meet me. I get to get exposed to all these ideas that to me is worth more than any amount of money I could ever have. And that's really stuck with me because I. But I think he's right. I think he's right.
- [80:50]
B
I agree with him. I mean, I like Jimmy Wales. By virtue of this adventure I've been on, I get lenses into really interesting parts of the world, which, for the most part, have made me more optimistic about the world. Every now and then, I get invited to various conferences where very powerful people are talking about the problems of society and how to fix them. And when you get into these circles, you realize most of these people are, are honestly just trying to help. You might not agree with everyone, et cetera, et cetera, but it's actually been very, it's made me more optimistic about the world, not less.
- [81:28]
C
When you think about just this incredible journey and the amazing success of Khan Academy, how much do you think it has to do with your skill and how hard you worked and your intelligence, and how much do you attribute it to luck?
- [81:42]
B
Luck. It's all, all of the above. I mean, it's, you know, one person can call it luck, one person might call it benevolent aliens working in your favor to prepare humanity for first contact. But yeah, there's something, you know, that I, I, I, I, I can't. I mean, there's a lot that I can't take credit for. I mean, and, and above and beyond luck, there's circ, I guess it's luck. Where I was born, where I was born, had the teachers I had, had the, the friendship that I had, and then, you know, fell into things at the right time and, but every now and then you see a door crack open. You say, I think there's something interesting on the other side of the door and you've got to sprint through it. And so I try not to overthink when, when there are signs in my life that, like, that door is open. Don't, don't, don't make someone have to force you through the door, like, run through that door.
- [82:36]
A
That's Sal Khan, founder and CEO of Khan Academy. And by the way, Sal has just taken on an additional leadership role at another nonprofit, ted. They're calling him a vision steward, and it's a pretty safe bet that he'll be focusing a lot on education. Hey, thanks for listening to the show this week. Please make sure to click the Follow button on your podcast app so you never miss a new episode episode of the show. And if you're interested in insights, ideas and lessons from some of the world's greatest entrepreneurs, sign up for my newsletter@guyraz.com or on substack. This episode was produced by Jed Anderson with music composed by Ramtin Erabloui. It was edited by Neva Grant. Our production staff also includes Alex Chung, J.C. howard, Chris Masini, Sam Paulson, Katie Cipher, Kerry Thompson, Andrea Bruce, Romel Wood, and the Lady Coates. I'm Guy Raz, and you've been listening to How I Built this. And don't stop the podcast just yet, because right now you're about to hear an amazing small business story that you don't want to miss. This segment is presented by American Express with a Business Platinum membership. The best just got even better.
- [83:48]
Our story today begins in the fall of 2020 2018, when a mom joined a Facebook group that changed her life.
- [83:55]
D
When our oldest son went off to college, he actually stayed in St. Louis and attended WashU. And I joined the Facebook parent page that a lot of parents join.
- [84:05]
A
This is Mindy Horwitz. Mindy noticed that on that page a lot of the posts were from out of state parents asking for help with local logistics. Things like how do I mail a laptop to campus before my kid arrives? And can anyone recommend a car mechanic?
- [84:20]
D
One day I saw a parent from Boston advising a parent from Florida about the best dermatologist in St. Louis. And that was kind of a light bulb moment for me that well connected locals had an opportunity to create something.
- [84:34]
A
She wondered if local expertise was something parents would pay for. She tested her idea on parents in her friend group and got a lot of encouragement. By the next summer, she was ready to launch. Under the name Mindy Knows, I purchased.
- [84:48]
D
An ad in the newspaper that went home to every new family at Washu. It was like, imagine if you have a student and they have a birthday coming up. What do you do? You call Mindy. Or your car is being shipped to St. Louis and you aren't there to receive it.
- [85:03]
B
What do you do?
- [85:04]
D
You call Mindy. And I thought that immediately my phone was going to start ringing and it was radio silence. Like, I really wasn't sure that the newspaper had been sent. Everyone had told me for a year what a great idea I had, but it was quiet.
- [85:19]
A
But Mindy believed in her idea and stayed patient. Eventually, the calls started coming and she was able to solve real problems for families, sometimes in a big way. Like one year when St. Louis got hit with a blizzard.
- [85:34]
D
The mom reached out and she was really in a panic. Her daughter was sick and the daughter needed medicine. Nobody was making deliveries and nobody could get anywhere.
- [85:41]
A
Mindy made a few calls and got the medicine delivered. By 2023, business was going pretty well with revenue coming in via monthly retainers and hourly fees. And that's when Mindy got an email from a reporter asking for an interview.
- [85:56]
D
And we ended up on the COVID of the Wall Street Journal, which was just unbelievable. And once that happened, I had people from all over the country who were calling me and they wanted to be a Mindy.
- [86:08]
A
Mindy ran with the idea. There are now licensed Mindys on nine other college campuses. And yes, some of them are men.
- [86:16]
D
But we still call them Mindys.
- [86:18]
A
Mindy loves that through her work, she can help families through hard times and celebrate the good ones, too. She recently hand delivered champagne and cupcakes to a fourth year med student, a treat from his mom for finishing his residency applications.
- [86:33]
D
I met him on his campus. He was in his scrubs. Oh, it was so cute. And really, at the end of the day, it's about what his mom's arranged for him. His mom is the one that he's grateful to, but I get the fun of acting on her behalf.
- [86:44]
A
That's Mindy Horowitz, the founder of MindyKnows. Her story was presented by American Express. To build a business like no other, you need a card like no other. There's nothing like business Platinum.
- [87:05]
If you like how I built this, you can listen early and ad free right now by joining Wondery plus in the Wondery. App or on Apple Podcasts. Prime members can listen ad free on Amazon Music. Before you go, tell us about yourself by filling out a short survey at wondery. Com. Survey.