Universally loathed by people who know, but stacks up well on feature comparisons charts.
Players like Canvas[1] are sort of trying your idea. The front page of their website reads:
IS IT REALLY A LEAP OF FAITH WHEN YOU JUMP TO SOMETHING BETTER? “It just works.” “It’s easy to use.” “It lives up to high hopes.” “It’s the next generation of LMS.” These are just some of the reasons San Jose State University decided to switch to Canvas. And are glad they did.
They compete directly with Blackboard and seem to be doing ok.
I think most schools want to see something that's proven, low risk, and beneficial. If you can show them some of the top schools are using your software, and their faculty and students are raving about it, and how it's making their lives easier, reducing costs, and how the transition from BB was seamless.
The problem is obviously getting the first few schools. You need to eliminate as much risk as possible. You need a lot of credible sources backing you in this situation to make buyers more comfortable.