They learned from the Google school of public relations. ("What, make money? Hah, hah, we're just a bunch of geeks who like interesting problems, no crass lucre here, no siree!")
So reCaptcha's basis is a new field known as Human Computation that Luis invented himself. The term was coined in his Ph.D thesis. Google, however, has been the only company to really embrace Human Computation so it's not really a huge surprise that reCaptcha was sold to Google.
The most common phrase that uses the word lucre is "filthy lucre," a reference to money being something that distracts noble people from pursuing altruistic goals.
There are only so many times anyone wants to hear about his MacArthur Genius Award or how both Microsoft and Google fought over recruiting him and how instead he took the high road and decided to stay at CMU. Maybe it was because it was his first time leading 251 and he was out to prove he was worthy....
That said, he was a very good teacher. Great lectures with lots of student involvement. He also had some creative ways of catching cheaters.
I apologize in advance if some of the details are wrong. Please correct me if you remember this incident better:
When 251 started, everyone was required to sign an honesty policy about cheating, etc. The policy explicitly stated that students shouldn't use online (or other) resources for help while working on homework sets.
One of the early sets featured a fairly difficult problem. Many students succumbed to the power of the Google search box and typed in some keywords around the problem. In the first page of organic results there was a site full of algorithm question and answers, including this problem but none of the others in the set. The site's domain looked innocent; I think it even had the word math in it. Many clicked, found the answer and either used it to guide their thinking or copied it close to verbatim, cheating either way.
At the lecture following the assignment due date, Luis announced that he knew X number of people had cheated on the last homework set. He stated that anyone who came clean would receive a zero on the assignment but wouldn't be reported to the dean. Since many students worked on these problems as groups by splitting up the work, a few though that their friends had ratted them out. Others had cheated differently and thought they had been caught but didn't know how. Regardless of the method, everyone who cheated came clean.
At the next lecture, Luis told us how he did it. The innocent site was actually his, running off a box in his lab. A simple whois confirmed it. He had logged all IPs accessing the page and correlated them with student usernames. This wasn't that far-fetched: since everyone at CMU registers their computer with computing services in order to get network access, a reverse DNS to hostname, which usually contains the username, would be enough to identify. Besides, he could also have worked with computing services to get the original registration username as well.
Even if he had identified only 10% of X, he managed to get everyone who cheated to admit it and send a clear message at the same time.
