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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 a 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 it.
It 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 know, you can imagine my mother, who you know.
When I told her I'd quit my job, I still remember her first word was what?
Welcome to How I Built This a show about innovators entrepreneurs, idealists and the stories behind the movements they built.
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.
So most of the products and services we've talked about on the show have been innovative or disruptive in some way.
But some of them, and you've heard me say this before, have fundamentally changed the way we live.
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 product or offers a service that is 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 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 operations that charge money.
But we'll get to all that in a moment.
First, let's back up just a little bit.
Sal Khan grew up in Metairie, Louisiana.
His mom was from India and his dad was from Bangladesh.
And the marriage ended when Sal was pretty young.
My parents, you know, had issues.
And so they separated when I was probably about 18 months old, two 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.
Wow.
Was there a community of South Asian families in Metairie when you were growing up?
Yeah.
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 U.S., study, 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.
Right.
I had a very colorful childhood, you know, late night parties, people singing and dancing.
You know, for me, it felt like a I remember my third birthday that my uncle's 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.
So what did your mom do for a living?
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 and think it was like the coolest job on earth because you have this key that you can open up the vending machine and like 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, you know, 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.
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, 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 right,
The part of Metairie where we had our store.
It was called Seminole Convenience Store on Seminole Avenue.
And it's called a part of Metairie called Bucktown.
That was kind of the heart of David Duke's base, so to speak.
I remember you know, right outside of 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 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 know, growing up, I was, you know, 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.
You know, 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.
So 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, doctor, lawyer?
Like, was there any kind of talk like that at home when you were a kid?
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 that 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 know 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've been eight or nine years old at Kmart and I was being a brat.
I really wanted to be, you know, buy this Hot Wheels 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 you know one of my uncles.
They had a.
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 going to die.
I think I was about eight years old at the time.
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.
I read that when you were in high school, you were in college.
A heavy metal band or a death metal band or I don't know which one was it.
Is that true?
Yes.
I was the lead singer, but singing is being very generous to what I was doing.
It was more of yelling or growling.
You were the lead growler of the death metal band?
I was the lead growler of a death metal band.
What was the band called?
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.
Anyway, you know, it was me and three other guys.
Yeah.
All right.
So you were in this band and – but it sounds like school was pretty easy for you.
You were doing pretty well.
Yeah.
I was a kid that kind of did just whatever I needed to do to get a decent grade.
And it was about ninth or tenth 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
I had this kind of path.
I had this choice that I had to pick.
This was Malignancy's first main gig?
Yeah, we had an opportunity to open up for Paralysis, which is a big deal.
Malignancy opens for Paralysis.
Yeah, it's definitely – and some of the people who were in my band, they were starting to get into trouble.
Some of them started – doing some drugs, you know, getting a little bit into I would call a scary crowd.
And that, frankly, you know, I had my quiz bowl and academic games friends.
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 scared me.
Huh.
So when it came time to apply to college, were you encouraged to aim pretty high, like to a prestigious school?
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, Farah, have you looked at the tuition at Brown University?
There's no way we're going to be able to afford 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.
You know, someone's kid has a perfect GPA, is 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 Tuhin.
Tuhin 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 Tuhin.
So I guess your mom was pretty happy because you wound up going to MIT and when you got there was it just so exciting.
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.
You know, 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 um, it's the closest thing to hogwarts in in the real world, where you, 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 affect 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 starting to become very relevant to society as a whole.
So MIT was and I think continues to be an incredibly exciting place.
You graduated MIT with a master's degree.
You like double tripled up on classes and I guess just were insanely productive and got a degree in computer science.
What did you do after you graduated?
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 was like, what?
Your mind was blown.
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.
That's my first job.
Wow.
So you moved to Silicon Valley to work, to California to work for Oracle, I guess.
Yeah.
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 H-1B visa from India.
And he said, Sal, why are you here?
I was like, well, you know, it pays really good.
He's like...
I'm here because I have to get my immigration.
But you're a citizen.
If I were you, 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.
It was going to democratize venture capital.
It was called MeVC, where the idea was 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 Roberts and Stevens.
At the time, they had come up with a structure that could be a publicly traded venture capital fund.
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.
It's a great idea, but still hasn't been democratized to this day.
What happened to the startup?
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 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.
Yeah.
So I started looking up applications for business school.
So you decided 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.
Yeah.
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?
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.
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.
And 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?
Like, 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 in hedge funds or who were going to work in hedge funds and said so what's the pay like?
Is it good?
And they kind of looked at me like, are you crazy?
It's like, it's about as good as it gets.
Yeah.
So I guess you decided to do exactly that, to get a job at a hedge fund.
Was it easy to land one?
No, my application got rejected hundreds of times.
And my resume did not look like a hedge fund resume.
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 literally went through the directory of any hedge fund in New York.
And I was getting one rejection after another.
And then eventually there was this guy, Dan Wohl, based in Boston, who was a Apparently getting his hedge fund off the ground, and Dan at the time was 32 years old, I think, or 33 years old.
I interviewed with him and he hired me.
He later told me he hired me because I didn't have a background in finance.
He liked that I seemed to be an out-of-the-box type of personality.
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 um, and so yeah, that that was my first job in finance.
How'd it go?
How did you do?
You know, I got to 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 like a kid in a candy shop because I was able to Every day.
I mean it's 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 you know the first half of the calls.
I would always say like it was a little bit of like gee whiz.
So how does this work?
How do logistics work and 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 know, what you're saying doesn't make sense and push the management teams a little bit harder.
And I mean, while you're doing all this, you're also sort of starting what would become Khan Academy.
I mean, you're working there in Boston, and I guess this is around 2004.
Like the story I guess that I've heard is that your sister's daughter is like having trouble with math.
Is that sort of the story?
It was a cousin.
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 had come, they wanted to visit Boston during 4th 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 Nazrathanti, 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'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 was like, I'm 100% sure you're capable of learning unit conversion.
How about when you go back to New Orleans and I'm happy to tutor you remotely.
And she was up for it.
And so that's that was August of 2004 when I started tutoring Nadia.
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?
Yeah, it was over the phone.
And we'd use 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 could 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...
I think it was a $60 pen tablet so that you could write.
But it was on a little part of your instant messenger window, but that's still enough that you could write things like 3x is equal to 6.
What does x equal?
So that's how we did it.
And this was just something you were doing at night and kind of after work.
Yeah.
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 say, you know, I really think Nadia Rahman 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 was only a few months ago put into a remedial class, was now put into an advanced math class.
And I was hooked.
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.
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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?
I would love to believe that I'm some type of super tutor or something, but I think the reality is and 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 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 re-motivate 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 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 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.
And I guess, like the word gets out in 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?
Yeah, I mean put exactly as you described.
Word spread that free tutoring was going on 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.
On a given day?
Yeah.
They would all get on the speakerphone together and I would answer questions they had.
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 just to support them all.
In the meantime, you were still working at a hedge fund, right?
I was.
And I have to give extra credit to Dan, because in the early days when I was working for Wohl 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.
By a month or two into starting my job, dan's like why are you still here, why aren't you going home?
He's like no no dan i'm, 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 sal, you're not going to help anybody by just, you know, having the appearance of motion, and 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.
Have your game face on, have your game energy.
But to do that you're gonna 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 group think 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.
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?
Yeah actually, even before the videos happened in around late 2005.
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 Math Planet.
So my brain was there throughout for a long time.
And so...
When I started working with my cousins I was like wow, you know, 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 then 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 that was the first Khan Academy.
You know, I set it up as a website.
And you just it was not very expensive.
Presumably you just kind of did it yourself and offered it to these kids.
Yeah.
And I remember, you know, 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 that again.
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 is Zuli 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 Zuly, it's hard to do with 10 cousins what I was originally doing with just Navia 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 vocalized him.
I was like, no, that's like YouTube's for cats playing piano.
It's for dogs on a skateboard.
Right.
It's not for learning.
And I went home that weekend and I think I probably had explained least common multiple to a cousin for like the eighth time.
And I was like, maybe Zuly's got a point.
Maybe I should make a video on least common multiples for my cousins.
And then it was just a, how do I make the video?
I mean, back in 2006-
Cell phones weren't particularly good.
I didn't have a video camera.
And you do a Google search, you realize, oh, there's something called screen capture software.
And so I downloaded some free screen capture software.
And I started just essentially recording some of my digital scribbles using my pen tablet.
But you can hear my voiceover while I'm talking.
And they were done very extemporaneously.
They're from my cousins.
And 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.
Really?
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 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.
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 denominators.
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?
Oh, there was for sure something.
My brain, it oscillates between these mega delusional 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 I was super inspired when I was young.
In seventh grade, I read-
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 10000-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?
It feels so inspiring and epic to think on that scale well beyond ourselves.
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.
The way to preserve civilization is really through knowledge.
That is what defines a civilization.
That is what defines human potential.
And so You know, while I was working on this in 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 in Iraq to prepare for college so I can go back to college.
People who dropped out of high school.
I was like 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?
Yeah.
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?
Yeah.
That's pretty accurate.
That's about what I – Were you surprised?
Were you like what is going on?
Who's watching this?
Yeah.
I was hoping that something like that would happen.
I mean, you know, when I put it on YouTube and it asked whether I wanna 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 you know not just the views but for I would say, the comments especially you know people like opening up on the YouTube message boards or opening up on you know 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, this is...
This is a 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.
Meanwhile, as you mentioned, I mean, you you're still with Dan at this point at the hedge fund.
And then I guess at some point he decides to move the fund to California.
Right.
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.
And now that we were on the West Coast, I was working from 5 a.m. 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 the hundreds of thousands of people were using it on a regular basis.
Yeah.
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.
There were many moments you know you can 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, you know, this virtual tutor.
And then you're like, okay, stop dreaming, Sal.
You know, look, you got to pay off your debt, pay off your mortgage, et cetera, et cetera.
So, you know, I had multiple cycles of that over the years.
People in Silicon Valley, they do understand quitting your job.
You know, some angel investor writes a hundred thousand dollar check and you're off to the races.
But I did incorporate it as a not-for-profit in 2008 to protect 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.
In my mind, it was initially an emotional thing to do.
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.
Yeah.
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 the only organizations that really do stay true to some social bottom line over long periods of time are nonprofits.
I did have some folks who were 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 yeah, can i write a check and we'll start this thing?
I'm sure, and it was tempting yeah uh, 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.
Yeah right and, and that just felt a little, you know, queasy to to me.
Um 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.
This hedge fund thing, 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 I could be on a trajectory like Dan was.
Dan, if he kept at it, could have easily become the next Warren Buffett.
But 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 multibillionaire.
Wow.
And I'm like maybe I can retire early and be, you know, reasonably well off, so that I could do this at that point.
So what?
– how did you decide to leave that relatively secure and stable – not stable, but you know this path towards immense riches and jump into – this full time?
What happened?
What was the catalyst?
You know, 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 like these therapy conversations with him almost like on a weekly basis.
And he would just keep calling me and say Sal, Your purpose in life is not 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 gotta be some way that someone will fund this as a nonprofit.
The impact on the world could be so huge.
And so-
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, you know, my son was born in February of 2009.
And I'm like, okay, now I have another mouth to feed.
You know we were renting a house.
You know that 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.
You were not a millionaire.
No.
I was not a millionaire.
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.
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.
Your wife, I think, was not yet a doctor.
She was still in residency or maybe.
She was.
Yeah, she was in fellowship 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, OK, do it, but just for a short period of time?
Yeah, it was a process.
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 don't look like.
You've been showing me these letters you've been getting.
They are incredible.
And it does seem like you're onto something.
But then let's look at our finances and we would look at it.
Our rent, to rent a four bedroom house out here at the time, it seemed like a lot.
It was $4,000 a month.
She was making probably $40,000 a year as a fellow.
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 I was like, oh, surely one of these people will fund it.
So let me be.
And we're off to the races.
A million bucks and we're good to go.
Exactly.
So I quit the job and then it doesn't work that way to work out that way.
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?
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 or our budgets are already allocated.
And so 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.
So it was incredibly stressful.
And 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, her first word was, what?
Yeah.
I was literally in that tone because, you know, as we talked about, you know 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, you know, not only was there a monetary aspect to it, there was probably a shame aspect to this as well.
That you know was hard.
Yeah.
Love your mom.
Yeah, no, right.
I mean, she came to the United States with nothing and really you know kind of was scraping by most of her career.
And her son goes to MIT and then Harvard Business School.
And now he's calling mom and saying, yeah, I'm going to do this nonprofit thing.
Yeah, that no one has funded.
This non-profit 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?
It's not it's.
You know we'd go to gatherings and you know I remember at one party and they kind of asked 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.
I'm 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 wait.
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.
How I Built This Hey, welcome back to How I Built This.
I'm Guy Raz.
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.
The first three months, you're euphoric.
You're super excited about your new lifestyle as this nonprofit do-gooder and all of that.
I would say by month seven or eight, I couldn't sleep.
I literally couldn't sleep.
Anxiety?
Yeah, I was getting anxious.
I was...
Waking up in the middle of the night in cold sweats.
I was.
You know.
I would look at my bank account over and over again and look at the, you know, look at our expenses.
I would run financial models for my family, you know, and my wife would say, oh, what are 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 wasn't, I was in a really bad place mentally and the stress and the anxiety was killing me.
Was there also that kind of maybe residual fear of like failing?
Yeah.
I think there's.
You know we talked a lot about childhood and you know, not having a lot of resources growing up.
I think I, I frankly still have a fear of being one catastrophe away from financial hardship.
Yeah.
And, you know, in 2009, I was like, I made the catastrophe happen.
Like I, And it wasn't like a hurricane or something that's ruined our finances.
It's not a fire.
It's like I quit a good job.
And like the type of job that I had is not easy to get.
And, you know, I would try to channel whatever nervous energy or anxiety I had into the work.
I was like, let me make more videos.
Let me make more content.
Let me write more code and hope that eventually someone will notice.
Yeah.
I guess, like sort of maybe it was a kind of a low point that you hit and a wealthy, very wealthy person reached out to you.
This is Ann Doerr, the wife of John Doerr, the billionaire venture capitalist, kind of reached out to make a donation.
What was the story?
You know, 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 10, 20 every now and then.
A 50 donation would come in.
That was pretty exciting.
And then I saw a $10,000 donation come in.
It came in through the site, just $10,000, just like that.
Yeah.
It was I.
I I mean just like I got an email notification from like PayPal that, like 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, and, Then, you know, I immediately did a Google search.
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've tried to project like I'm a real institution.
And if we were a physical school, you would not have a building named after.
And Ann immediately emails back and says well, you know, i didn't realize that you, you weren't getting this kind of donations.
Um i, i see that you're based in mountain view.
Uh, 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 with you.
And i was like yeah, absolutely.
And so a week later, a Maybe a few days later, we were in downtown Palo Alto at an Indian buffet restaurant.
She asks me over lunch, so what's your goal here?
And I told her when I filled out the paperwork with the IRS to become a nonprofit that little part of the form where it's like mission colon and they give you a line and a half I filled out a free, world-class education for anyone anywhere.
And I remember 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, 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 it 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.
I've, by this point, been rejected by so many major foundations, probably about 20 of them But in preparation for all of them, I had a binder of testimonials from around the world.
I mean, it was literally several hundreds of pages thick.
And, you know, these letters, I showed it to her.
I showed her how 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've made a lot of progress.
I only have one question.
How are you supporting yourself?
And as proud of a way as possible, I said...
I'm not.
And she kind of processes that.
Because she's thinking you're a big shot.
You're like doing TV interviews and hundreds of thousands of people using this, like, right?
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.
I wasn't in the know.
I wasn't even in the right circles to be experiencing the buzz.
And so anyway, she offered to pay the bill and I said, oh, if you insist.
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.
And 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 like the next half an hour.
Wow.
Like, you know, holy crap.
I mean, I think I was, I might've 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 a hundred thousand was all of a sudden going to like change everything forever, but it's like okay, I can now pay my bills.
Yeah.
We're not going to have to dip into savings.
You know it gave a like I can do this for a few more months, for a year at least, or maybe even a little longer.
So she fires you a $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 to.
So how did you find out about Bill Gates mentioning you at Aspen?
So I started getting text messages from Anne, which you can imagine I now take very seriously.
And there were four or five of them, and they were kind of cryptic, as text messages often are.
And they said this is Anne writing.
I'm at the Aspen Ideas Festival Main Pavilion, Walter Isaacson, interviewing Bill Gates.
Gates last five minutes talking about Khan Academy.
Wow.
And once she kind of stared, I was like, what is she talking about?
And I started 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?
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.
Yeah.
You know, it's just one of those moments where you're just like, is this really happening?
Did you have any idea that Bill Gates was using this with his children?
I had no idea at all.
I mean, it's it was it definitely gelled with some of the delusions that I've had over over time.
But, you know, 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?
Do I call him?
How do I contact him?
I'm sure he's not listed.
How do you contact Bill Gates?
It wasn't obvious.
And so 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 calls 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 going to 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 a 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's favorite teacher.
Wow.
You know, the press sometimes writes these hyperbolic headlines.
And I always felt insecure.
I was like, am I his favorite teacher?
Like, did he say that?
Are they misrepresenting?
Like, I felt serious imposter syndrome.
And then I got a call.
My cell phone rings right when I'm going to record a video.
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.
And 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.
Yeah.
I said, yeah, maybe next Wednesday.
You know, I've got to cut my nails, do some laundry.
I'm happy to meet with Bill.
Can make that work.
So, yeah, I flew up and we had that meeting.
What was that like?
And it was a little bit awkward.
There wasn't like an obvious like, oh, you know, I love what you're doing.
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 then I just started into – I had my laminated slides that showed Anne with me.
I love it.
You didn't bring a laptop.
You brought laminated slides.
I love that.
Yeah.
I mean there's an irony to it that you know I'm obviously someone involved in technology, kind of 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 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 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 then I got overconfident.
I remember I threw out another idea.
He's like, no, that doesn't make sense.
I was like, oh yeah, you're right.
You're right.
Wow.
But was there any like, and here's a plan on how we could collaborate.
Was there any of that at all?
They asked, Bill said, well, what would you do with more resources?
And I was like, this is a question I have to answer really well.
And I said, look, 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 a hundred million, you know, by the end of the decade.
They said, well, what would you need for that?
And you know I said look, if I could hire up about five, six engineers and educators and content folks, I think we'll be up and running.
So you know, fully loaded costs in Silicon Valley that'd be a million million and a half dollars a year.
And so they said, yeah, well, we'll think about that.
That seems reasonable.
So, yeah.
And then a few days later, they said, yeah, they feel like they could do that.
So I started talking to the Gates Foundation about that grant.
And simultaneously, folks from Google had reached out.
Wow.
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.
And 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.
So we had a 4 million initial funding for that first two years to hire up a team, internationalize and start scaling Khan Academy.
Wow.
More than $4 million.
Yeah.
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, right?
I mean, isn't it?
Yeah, it was.
I mean, I immediately call –
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 pretty much like brothers.
And 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 really eerie how these people came out of the woodwork.
These two engineers that summer, Ben Kamens and Jason Rosoff, they had volunteered for Khan Academy.
And I just assumed there were some young kids who were looking for some experience.
But when they were volunteering, I'm like, these guys are incredible.
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 known figures.
They were like You know, really well-known engineers and designers.
And so they were shunted in 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 move out to the Bay Area.
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 2007.
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 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 Academies, I can say not.
So secret sauce, I believe, was its eccentricity, its quirkiness, its informality, coupled with its depth and intuition and desire to show the wonder in the universe and the curiosity.
And so the last 10 years for me have just been, how do I...
How do I balance that?
Can I bring in other people who also compliment us, but we do not lose that entrepreneurial, that creativity, that curiosity, that eccentricity, that quirkiness that made Khan Academy what it is.
Yeah.
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 Puttycomb, if you're familiar with it.
I'm very familiar with it.
Right.
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 you started – the funding started to come in that you needed – to get other people to make videos to your standards.
Now, 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.
And one of the reasons why we became a little sensitive of 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.
Yeah.
So we've been trying to balance that.
It's amazing.
I met David Coleman a couple years ago, 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.
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, the College Board of the folks who administer the SAT and the AP exams.
The College Board was a non-for-profit that came into existence to try to level the playing field.
A hundred years ago, the only kids who were getting into Ivy League schools were kids of legacy, kids who 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.
And David said, look, we've been – secretly observing Khan Academy.
And what we really like about Khan Academy is y'all are about really learning the material.
I had actually made some SAT videos for Navia 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 was 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 by-product 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.
Yeah.
I think the last time I checked it's more than this now.
Khan Academy videos have been viewed like almost 2 billion times.
Which is insane.
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 things, language skills etc.
I mean, I'm sure people came to you and said, Sal, let's spin off a for-profit channel here.
You've got something big here.
And then you won't have to worry about raising money for Khan Academy.
You can still do that, but let's do that.
I mean, that must have happened.
That must still happen.
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.
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 you know I every now and then go to a friend who's done well with their IPO or something and they've got the new Tesla or thing.
They're living in a, you know.
They're living slightly upstream the income gradient in our neighborhood, you know, and they're a little higher up the hill.
But I remind myself, one, I consider myself incredibly fortunate to be able to do what I am doing.
And, you know, the way I think about it is I've done my philanthropy in reverse order.
And you know I could have stayed in the hedge fund world and, you know, maybe one day become a multimillionaire or larger.
But then what would I have done with that money?
You know, I'm not someone who wants that much.
You know I want to be able to, you know, have a backyard, be able to, you know, support the family.
You know, go on a vacation once or twice a year.
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, you know, just time shift it and work on it.
And I do generally think that it has benefited the mission and the vision because once you know, people hopefully are viewing it as an institution.
They do, they're rooting for it because they realize that it's not.
It doesn't have an ulterior motive.
You know 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, right?
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 have – 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 think he's right.
I think he's right.
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 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.
When you think about this, just this incredible journey and the amazing success of Khan Academy, how much do you think it has to do with you know, your skill and how hard you worked, and your intelligence, and how much do you attribute it to luck?
It's 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 can't.
I mean, there's a lot that I can't take credit for.
I mean, and above and beyond luck, there's, I guess it's luck where I was born, where I was born.
I had the teachers, I had had the, The friendship supports that I had, and then, you know, fell into things at the right time.
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 there are signs in my life that like that door is open.
Don't make someone have to force you through the door like run through that door at 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 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 at guyrazcom or on Substack.
This episode was produced by Jed Anderson with music composed by Ramtina Rablui.
It was edited by Neil Grant.
Our production staff also includes Alex Chung, JC Howard, Chris Messini, Sam Paulson, Katie Seifer, Carrie Thompson, Andrea Bruce Ramel Wood and Elaine Coates.
I'm Guy Raz, and you've been listening to How I Built This.
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Our story today begins in the fall of 2018 when a mom joined a Facebook group that changed her life.
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.
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?
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.
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 an ad in the newspaper that went home to every new family that watched you.
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.
What do you do?
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.
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.
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.
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.
And we ended up on the cover 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.
Mindy ran with the idea.
There are now licensed Mindys on nine other college campuses.
And yes, some of them are men.
But we still call them Mindy's.
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.
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.
That's Mindy Horowitz, the founder of Mindy Knows.
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