Online university challenges Ivy League institutions

No new elite world-class universities have been founded for at least 100 years (Stanford - 1891; Rice - 1912), and most of them are centuries older than that, Fast Company reports.

Ben Nelson, former CEO of Snapfish, has just announced that he's starting a new one - for-profit and online. The Minerva Project has scored $25 million, the biggest seed bet in Benchmark Capital's history, for a projected 2014 launch.

Nelson, improbably, has been a university-reform geek since his undergraduate days at Wharton, where he organised multidisciplinary courses and field trips. He sees a huge untapped market, especially internationally, for undergraduate liberal arts education at the elite level.

"Harvard says that 80% to 85% of its applicants are fully qualified for admission, yet they have a 5.9% acceptance rate," he tells Fast Company. "We think, conservatively, there are 250 000 English-fluent, smart, driven young people who aren't able to get into an Ivy League university or equivalent in their home countries, and if we capture 1% of that market, we'll be self-sustaining."

What Nelson envisions is an institution with no capacity limits that offers high-quality instruction from the top minds in academia to the best students the world over by harnessing the ubiquity of Internet access, Digital Trends notes.

It's a bold endeavour, and of course, Nelson isn't the first to take on the marketplace of online education, or even of elite online education. Both online campuses affiliated with brick-and-mortar institutions and standalone programmes abound, and newer models are popping up every day; tenured Stanford University professor Sebastian Thrun left his post in February to set up Udacity, a for-profit school offering free college-level classes on topics like cryptography and Web engineering.

Yet Nelson, who has left the corporate world to focus on the project, is confident that Minerva will find its place among the top academic institutions, and he does not seem to be the only one. The 36-year-old entrepreneur announced that he has secured $25 million in seed money from Benchmark Capital, a Menlo Park-based venture capital firm. It is the largest such investment in the 17-year history of the firm, which includes the early-stage funding of eBay, Twitter and several other high-profile tech start-ups. In addition, Nelson has received attention from a number of professors and academic heavyweights; former Harvard president Larry Summers asked to be chair of the advisory board, which also includes former Wharton Dean Patrick Harker, former New School president Bob Kerrey, and former Carnegie Foundation president Lee Schulman.