Lockdown, Not Knockdown: #9 Online Education

Digital Industries Booming in The Covid Era

Read my other articles in this series:?#1 (online language-learning),?#2 (online fashion retail),?#3 (productivity software),?#4 (food delivery apps),?#5 (dating apps),?#6 (digital fitness),?#7 (real estate apps) and #8 (on-demand video streaming).

At some point in your adult life, you may wake up with a strange sensation of unease that can best be summed up as: 'So ... is this it?'

In other words, by a certain point in your life, you will have finished all your formal education, found a job, settled down, set up your home, and maybe had kids and/or got pets. As difficult as it may be to believe, at some point, you will embody order and stability so much so that cynical bypassers will label you as pretty ... meh. The problem is, you'll only be in your late twenties or mid-thirties or early forties (or whatever you decide your 'age of stability' should be). Now, let's assume you live in the developed world. Let's also assume that Bill Gates is right and that barring accidents, tragedies, and incurable diseases, you are likely to live well into your 80s . Given all this, you can't help but wonder: Now that you are living a stable existence, what are you going to do with the remaining, say, 45 years of your life? Because that's a fairly long time to be bored and boring.

I have found that learning new things can be a pretty effective medicine against apathy, existential crises, and ennui. You may have not thought about it, but your curiosity is a powerful ally if you think you may have plateaued. It is virtually never late to pick up coding, learn Korean or teach yourself how to bake six-layer cakes if that's something you are interested in. That is also the primary reason why I'm so grateful to be living in 2021: if you want to learn anything and have Internet access, all you have to do is pick a subject and stick with it. Importantly, you can do it all for free - YouTube is an endless source of knowledge (and cat videos...but let's focus on knowledge).

Should you choose to learn for zero money, the downside is that as a complete beginner, you will probably be lost in trying to navigate this new territory without proper guidance. That is unless you're Scott H. Young , the author of Ultralearning. Scott is famous for having replicated the four-year undergrad MIT Computer Science curriculum and teaching himself to code for free following that very same curriculum.

Those of us not motivated enough to replicate university curricula will do the next best thing: we will sign up for online courses. E-learning, which had previously been complementary to presential learning, has over the previous two years become the norm for everyone: enthusiastic adult amateurs, employees training themselves in new skills, as well as school-age children and university students.

Social Distancing and Distant Learning

In 2020, the global e-learning market was estimated at 250 billion US dollars . Even before the pandemic, the market was estimated to reach 350 billion dollars by 2025 , and given the rapid growth in 2020 and 2021, that number is now seeing considerable upward adjustment. Some sources are even mentioning the possibility of reaching the magical figure of 1 trillion dollars by 2027 .

When schools shut down in early 2020, some 1.2 billion children worldwide were learning from home: some over Zoom, others over Skype, and some using more sophisticated e-learning platforms. While the process of getting used to this new way of learning was frequently chaotic and messy, millions of children and university students had no other option.

But online learning is by no means limited to children and students. Anyone interested in learning online, be it as part of a university program, be it as a self-standing course, could do so long before the pandemic. For example, a while ago I spoke about language-learning platforms . Yet it took the pandemic for online learning to really take off. In the next section, I'll go over some of the most important e-learning platforms for students and adults who want to grow in their jobs, or simply learn for fun. I'll try to be brief, but here's a disclaimer: when it comes to online courses, I'm like one of those children from Coca-Cola holiday commercials marveling at Christmas lights.

I might get carried away.

Early Birds

One of the earliest online learning platforms out there is certainly Lynda.com , a website launched in 1995 in California by Lynda Weinman and her husband. The site served as a companion to books and other materials Lynda was using to teach at the time as she ran a digital arts school. In 2002, Lynda.com started offering its first online courses. Those gained traction in a relatively short time span, and Lynda.com started receiving first investments and offers.

Eventually, in 2015, the company was bought by LinkedIn for 1.5 billion dollars and when Microsoft bought LinkedIn the following year, Lynda.com became part of the Microsoft empire and was renamed LinkedIn Learning . The company now has a monthly subscription or you can purchase specific courses separately. LinkedIn Learning, which is also offered to Premium LinkedIn users for free, features more than 16,000 courses in Business, Creative, and Technology and has 27 million users .

When you think of online learning and have some knowledge of the space, one of the names that will first pop up is Khan Academy . Khan Academy was started in 2005 by Sal Khan who, after recording a few YouTube videos for his niece who had Math difficulties, realized that he could make an impact in global education by offering a wide array of similar educational videos to anyone interested. Khan Academy targets schoolchildren and students but is free and open to everyone. Courses are offered in subjects like Mathematics, Science, Computing, Economics, Reading and Languages, Humanities and Life Skills. Khan Academy is a non-profit (and will stay one, as Sal Khan maintained on the How I Built This podcast ) which currently has more than 10 million users .

Democratizing Knowledge: MOOCs

Around 2010, prompted by the financial crisis and increasing student debt in the US, many Northamerican universities started offering some of their most popular courses free of charge online. Justice by Michael Sandel was one of the first such extremely popular Massive Open Online Courses (MOOCs). CS50 , an introductory computer programming class, also at Harvard, was another one.

With his innovative course about right and wrong, Michael Sandel, Harvard University professor and political philosopher, attracted hundreds to the Harvard Sanders Theater, and millions more joined online when the course became available on edX. A similar thing happened to David Malan who faced a shortage of physical space (and Sanders Theater has the capacity of 1,000!) when offering his intro coding class CS50. So he, too, turned to edX.

edX is a MOOC platform created by Harvard and MIT in 2012. The platform used to be a non-profit but was very recently purchased by a for-profit technology firm . It has 34 million users and more than 160 participating institutions . Concurrently, also in 2012 but on the West Coast, at Stanford, another MOOC platform was created: Coursera . Coursera, with 77 million users and 30,000 courses , partners with over 200 institutions and is a for-profit that went public in 2021. Many argue that the monetization of online education defies the purpose of MOOCs, which by definition should be open and accessible to all. Coursera has a business model that offers auditing of some courses for free, while certifications, specializations, and online degrees all have a cost.

From the outset, MOOCs have faced pushback from universities and users alike. A notable example is the abovementioned Professor Sandel, whose prominent course Justice, along with MOOCs in general, was criticized by one Philosophy Department as "a serious compromise of quality of education" and even "a case of social injustice". Users, on the other hand, have criticized the lack of personal attention, language barriers, as well as difficulties in tracking the learning progress.

Being A Course Creator

We have seen how MOOCs have become monetized over time. Another twist in the online learning business model happened with Udemy in 2010. The company, founded in California by several Turkish entrepreneurs, gave its users the opportunity to create courses themselves and make money out of them. Some courses are offered for free, while others are very lucrative . Udemy features 183,000 courses in 75 languages and has 44 million users . Importantly, and similar to LinkedIn Learning, Udemy focuses on improving job-related skills. All this being said, and similar to Coursera, Udemy has never made a profit .

For its part, Skillshare , founded in 2010 in New York City, follows a similar concept. It is exactly what its name indicates: a skill-sharing platform whereby users create courses in arts, crafts, technology, business, or life skills, and others learn from them. The company has 12 million users and 30,000+ courses . Like Udemy, Skillshare course creators make money.

Skillshare has a subscription model and pursues active (and aggressive) influencer and digital marketing strategies. The courses are not accredited, but the beauty of Skillshare is that it teaches what is usually not available on other platforms, such as cooking, painting, or creative writing. No wonder, then, that in 2020 when we all cooked and painted and wrote, the time users spent on Skillshare more than tripled . Another example of an unconventional e-learning platform is Art for Introvert , offering courses in art history, fashion, world literature, and other humanities, and where you can purchase single courses at a relatively low price without having to commit to a subscription.

21st Century Skills

In this day and age, coding and data analysis skills are among the most sought-after ones. In addition to the MOOC platforms, online (and presential) coding boot camps have exploded over the previous decade. You can try them on Coursera, edX, Pluralsight , General Assembly , and Udacity, just to name some. Personally, I have tried Udacity . The company was founded by a Stanford professor who initially wanted to build a MOOC platform but then pivoted into adult-targeting vocational programming training. When that didn't work, the company's focus was expanded to government and corporate memberships . In 2020, Udacity had a 260%-revenue growth . It is now profitable and has 14 million users.

In addition to programming and other IT skills, business skills are extremely useful in today's world of freelancers and entrepreneurs. That said, MBAs are notorious for their (exaggerated) cost, which is anywhere from 20,000 to well over 150,000 dollars. Moreover, MBAs are a significant time investment because they can take up to two years. While numerous MBA programs are offered online, the Spanish startup The PowerMBA , founded in 2017, came up with an interesting and disruptive concept to reduce the time and the cost of traditional MBA.

The company offers MBA-like programs in business, digital marketing, entrepreneurship, and e-commerce. These are not accredited but are still excellent and very practical. As a graduate of the business program, I can attest to its quality. The PowerMBA is famous for its 15-min-videos that you can watch over up to 15 months in order to complete the program. The selling point are definitely the case studies of Netflix, Whole Foods, or Youtube, just to mention some of the companies featured, as well as conversations with their founders. The cost is a three-digit figure which, a year and a half ago when I started it, was considerably lower, but even at this point, you get a lot of value for money. The PowerMBA has more than 55,000 students and has expanded to the US, the UK, Germany, and Latin America.

Making Money In The E-Learning Industry

As mentioned, the e-learning players range from pure non-profits to rapidly growing for-profits, all claiming to revolutionize education. In an episode of How I Built This podcast , Wikipedia founder Jimmy Wales maintained that the famous site would always remain free and his company always a non-profit because that's the only right thing to do when it comes to democratizing access to knowledge. Sal Khan of Khan Academy maintains the same. Logically, then, these organizations depend on donations and wealthy philanthropists to keep existing.

It is not easy to make money in the online learning landscape. You only have to remember Udemy or Coursera, never making a profit and taking on tremendous amounts of debt to sustain growth. Some companies tried to embrace a freemium model (e.g. Skillshare) but have since converted to full subscriptions. edX and Coursera still offer free audit tracks, with a possibility to upgrade. Others, such as Udemy, Udacity, or The PowerMBA don't operate using the subscription model, but instead, charge per course. LinkedIn Learning does both. In sum, almost everyone in this space is struggling to make a profit, which may come as a surprise knowing that their businesses are extremely scalable.

There are a few reasons why it's hard to make a fortune as an online learning provider. If a person wants to learn for free, they will easily be able to do so using YouTube, Khan Academy, podcasts, Wikipedia, Google, or free audit tracks on large MOOC platforms. Knowing that there is tremendous free knowledge out there, the rest of the e-learning companies will have to justify very well why they are charging for content.

Secondly and very importantly, e-learning platforms, much like everybody else, depend on returning customers. If I take a course, a company charges me for it, and then I never return, will my one-time engagement help the company to cover its costs? Even if I subscribe, and then cancel in a few months, that is not a much better outcome. The company needs to keep me motivated. To boost the involvement of their learners, e-learning platforms need to present their content in a comprehensible, clear, short, and yet engaging manner. That is an incredible challenge and the reason why the churn (dropout) rate in the business of e-learning platforms can reach high double digits . The customers usually get hooked with a free trial, and then leave when the trial expires.

Another engagement-boosting mechanism is creating learning communities. Many online learners complain about how solitary this activity is, and therefore building an active community of students and alumni can make all the difference.

Finally, as in any industry, it is important to identify a niche. It is difficult (and often not sustainable) to be offering hundreds of courses in all possible knowledge areas. Rather, and in order to not compromise the quality of education, the companies in this space opt for particular niches such as programming, business, or life skills. Aspiring to do everything will likely result in failure.

In short, the companies in this space are forced to innovate rapidly, introducing new value propositions, business models, and target audiences. For instance, Udacity pivoted by expanding its user base to corporate learners and governments. The PowerMBA, one of the best LinkedIn startups of 2020, is currently doing the same. They are also exploring the world of venture capital and entrepreneurship education.

The pandemic has shown that online learning definitely belongs to the New Normal. Will it always be free, accredited, and life-changing? It is unrealistic to believe that. But remember waking up with an existential crisis from the opening paragraph? At least those of us who like to learn for the sake of learning or gaining new skills can take comfort in resting assured that no, this actually isn't everything that life has to offer. We can still learn Chinese, explore the architecture of Columbia, teach ourselves acrylic painting, or whatever else our adorable inner children are craving. And technology is only making it easier.