Coursera, the online learning platform that offers classes taught by instructors at top universities like Stanford and Johns Hopkins, has raised an additional $130 million. Investors are valuing the company at a reported $2.5 billion. That’s up from $1.66 billion when it last raised money in April 2019, according to Pitchbook. Coursera’s total capital invested to date: $464 million.
The pandemic has given a huge boost to virtual learning providers. Coursera’s enrollments have quintupled year over year, says CEO Jeff Maggioncalda. “The global market for higher ed is worth $2 trillion,” he says. “It’s just massive and it was already moving online. With Covid, it’s being forced online.”
The funding round is led by bicoastal venture firm NEA, an investor in controversial trading platform Robinhood. Other investors include Kleiner Perkins and G Squared.
Coursera was on Forbes’ list of Next Billion-Dollar Startups in 2018 and the subject of a feature story. Based in Mountain View, California, it was founded in 2012 by Stanford computer science professors Daphne Koller and Andrew Ng, who envisioned it as a provider of Massive Open Online Courses, known as MOOCs. Their idea: Offer Stanford courses online to the world. The classes, a collection of short video lectures and multiple choice quizzes, would confer no college credit and they would be free of charge.
But MOOCs didn’t really catch on. People signed up and didn’t bother to complete classes. Coursera shifted its business model and started charging users. Top universities including Yale, Duke and University of Michigan signed on. The company now offers 4,500 courses with 160 university partners and 40 companies including Google and IBM, which also create courses. A typical Coursera class costs $49 and lasts 10 hours. A yearly subscription of $399 gives learners access to the entire catalogue.
The most popular courses include Python programming language classes taught by University of Michigan instructors and a class called Write Professional Emails in English, offered by Georgia Tech lecturer Gerry Landers.
When the pandemic hit, Maggioncalda says he wanted to help students who were suddenly forced to learn virtually. In June, he launched the Coursera Campus Response Initiative, which offers courses free to students enrolled in universities around the world. Some 1.4 million students have signed up, he says.
The free higher ed program has been a boon for students and it has also served as a great marketing tool. In September, Coursera will start charging between $250 and $400 per student subscription. Schools scrambling to provide online classes are already signing on, including Manipal Academy of Higher Education in southern India, which has an enrollment of 20,000.
Coursera’s enterprise business, which markets continuing ed courses to 2,500 companies like Novartis and Adobe, has grown 70% year over year, says Maggioncalda, and accounts for a quarter of Coursera’s revenue. He won’t share a revenue numbers but Forbes estimates that sales grew from $140 million in 2018 to $225 million last year and are on track to gain another 30%-50% this year.
Maggioncalda says he’ll use the new funding to expand internationally and to add more than 100 staffers to a workforce that already totals between 600 and 700.
How does he feel about Coursera’s success in the midst of a global health crisis? “It feels really good to be doing well and to be helpful to people,” he says. “But we’re doing that in a world that is facing unprecedented challenges and there is something that feels a little bit disconnected, even if you’re serving people in need.”