Mr. Nelson, founder of a start-up called the Minerva Project, believes the minuscule acceptance rates at prestigious institutions leave some college-bound students without a place where they can pursue a blue-ribbon degree. So his for-profit enterprise seeks to satisfy that demand by offering a rigorous online education to the brightest students around the world who slip through the cracks of highly selective admissions cycles. Mr. Nelson said his company, which is calling itself “the first elite American university to be launched in a century,” will disregard the barriers that might put the Ivy League beyond the reach of qualified applicants.
“We don’t care about geography, we don’t care about how wealthy you are, we don’t care if you’re able to donate or have donated in the past, or legacy or where your ancestors went to school,” he said. “We really just want to equalize the playing field.”
The start-up, based in San Francisco, plans to do so by charging tuition rates “well under half” of those at traditional top-tier institutions, Mr. Nelson said. The new university is seeking accreditation, Mr. Nelson added, and will welcome its first class in 2014. Though he did not specify how big he expects Minerva’s student body to be, Mr. Nelson said his goal is to make sure no qualified students “get rejected because we say we’re full.” He added that he expects Minerva to be “far better represented internationally than a typical American university.”
The company can afford to charge cheaper tuition, Mr. Nelson said, in part because it expects incoming students to have already mastered the material that makes up everyday introductory courses. For instance, Minerva may offer Applied Economic Theory instead of Economics 101, he said.
“What we expect to teach is how you apply and synthesize that information and how you do something with it,” Mr. Nelson said.
To create these advanced courses, Minerva will break down the role of professor into two distinct jobs instead of simply poaching faculty members from other universities. The company will award monetary prizes to “distinguished teachers among great research faculty,” Mr. Nelson said, who will team up with crews to videotape lectures and craft innovative courses when they are not teaching at their home institutions. (Mr. Nelson declined to elaborate on the size of the prizes.)
Minerva will then hire a second group of instructors to deliver the material. Mr. Nelson called them “preceptors,” who will typically be young graduates of doctoral programs—they will lead class discussions online, hold office hours, and grade assignments. After its students graduate, Mr. Nelson said the university plans to help alumni connect with their peers to create businesses, do research, and find jobs.
“The Minerva education isn’t just about getting your four-year degree and then going to work for Goldman Sachs and crossing your fingers and hoping you’ll do really well,” he said. “It’s actually playing an active role in facilitating your success afterwards.”
Mr. Nelson’s challenge to the Ivy League is already flush with cash: The prominent Silicon Valley investment firm Benchmark Capital has pumped $25-million into Minerva’s coffers—the firm’s richest seed-stage investment ever. And the company has attracted some high-profile advisers. Lawrence H. Summers, the former U.S. treasury secretary and Harvard University president emeritus, is the chair of Minerva’s advisory board, which includes Bob Kerrey, the U.S. Senate candidate from Nebraska who is a former president of the New School, among other education luminaries.
Minerva’s attempt to disrupt elite higher education is a “bold move,” according to Michael B. Horn, executive director for education at Innosight Institute, a think tank focused on innovation. “It’s kind of breathtaking in its ambition, and it’s exciting to see what will happen,” he said. He noted that especially among international students, there’s a tremendous demand for elite education and not enough supply. But he added that the upstart faces a significant challenge: creating an identity that will convince students to take a chance on a university with little name recognition.
“Can you launch a new brand that doesn’t have a track record in this age?” he asked. Ultimately, he predicted, the market will help decide Minerva’s fate: If its students do well and go on to great things, “that will create desirability over time. And that’s a critical lever to see if this will work or not.”