Karan Goel, class of 2004, emerged from the College with an objective different from the abstract knowledge and esoteric notions that U of C students are known for focusing on.
“I want to be an entrepreneur and create businesses that help solve people’s needs,” said Goel, currently an MBA student in the Graduate School of Business (GSB).
As far as Fortune Small Business (FSB) is concerned, Goel may be well on his way. PrepMe, Goel’s online test preparation company, took first place in the magazine’s annual Student Showdown business plan competition, a showcase of some of the country’s most promising new ventures. In what FSB named its most challenging contest yet, PrepMe beat more than 80 other start-ups from students nationwide.
Launched in January 2005 by Goel, Joseph Jewell, and Avichal Garg, PrepMe aims at the growing number of high school students taking the SATs and other standardized tests. These students are increasingly turning to tutors and private companies to gain a leg up in preparing for the exams.
Goel conceived of PrepMe in his senior year in high school, when he noticed a lack of affordable test preparation.
With the goal of eventually running his own company, Goel used his time at the U of C to hone his business skills, serving on Student Government and as chairman of the International Leadership Council. He was named the U.S. Small Business Administration’s Young Entrepreneur of the Year in 2004.
After graduation, Goel encountered Jewell, a Rhodes Scholar and co-author of the book Up Your Score: The Underground Guide to the SAT, and Garg, a software engineer. With a shared interest in test preparation, the three decided to focus on students taking the SAT, and promptly developed a business plan for PrepMe. Funded by money pooled from various merit scholarships, their enterprise was soon running, earning immediate acclaim in a GSB competition.
PrepMe offers test-takers advice, practice and evaluation from former top-scorers, as well as direct access to staff tutors, many of whom are current U of C students. Instead of teaching only general test-taking tricks, as most test preparation courses do, PrepMe offers an individualized program for each customer, geared toward improving specific areas of weakness.
For Adam Brunk, a second-year in the College who works as an SAT tutor and essay coach for PrepMe, this focused approach is the key to the company’s success.
“PrepMe’s tutors are the students’ guides through the course, there to answer any questions the students may have and analyze their practice essays,” Brunk said.
In addition to the top prize of $35,000 in venture capital and a small-business software package, Goel, the company’s CEO, is featured on the cover of the FSB November issue, providing his business with instant publicity. For a recent startup like PrepMe, this kind of exposure can help catalyze future success.
While stressing the merits of the PrepMe program, Goel acknowledged this impact.
“The Fortune award has been wonderful for us,” he said. “We are getting calls from all over the country and recently made our first international sale.”
Despite a fiercely competitive test preparation industry dominated by giant corporations like Kaplan and the Princeton Review, the young entrepreneurs insist that there is a market for PrepMe. They point to its unique, tailored approach to individual test-takers and its use of recent top-scorers as ways to clearly distinguish it from its rivals.
But for Goel, the most important factor is the dedication and ability of the PrepMe management and staff. By recruiting tutors from top colleges and universities, the company is able to hire employees who are both highly intelligent and highly motivated.
As for the other executives, “It never hurts to have partners who are geniuses,” he said.
