How Does Coursera Work: The Story Behind an EdTech Platform Leading the World with MOOCs

The online education industry has experienced significant growth over the last decade. A few years ago, who would have thought that we would be studying online from the comfort of our homes? EdTech app development services was a strange thought, especially ideas like Coursera business model!

But, welcome to the new normal, it is now a reality.

According to Statista, the online EdTech market is forecasted to reach $279.34 billion by 2029. With user penetration predicted to reach 11.6% by 2027 (increasing from 9.6% in 2023), the global market of educational technology solutions is expected to reach ~ $400 billion by 2026.

Moreover, the Online Education Market valued at $254.80 billion in 2021, is now expected to reach $605.40 billion by 2027. That means there is no sign of stopping when it comes to the growth of this industry in the years to come.

These statistics represent why to build an app like Coursera is a lucrative opportunity. While  online education platforms have been in talks for more than a decade now, all of them have seen considerable growth during the pandemic. Udemy, Khan Academy, Coursera, and many such apps are now household names as these platforms let people get access to education anytime and anywhere.

Primarily, the startup visionaries capitalizing on EdTech technology solutions can earn huge profits through subscriptions plans, course sales, certifications and more. In addition, collaborations with educational institutions and content creators create additional revenue streams.

In essence, individuals and organizations looking for accessible and high-quality learning solutions, and custom solutions for online education platforms present entrepreneurs with a financially rewarding and scalable venture. Before you inch ahead to create an interactive e-learning solution, let us first get an idea of the industry leader.

The app Coursera was founded early in this decade and today it stands at $5 billion in terms of market valuation. But, how did Coursera business model reach that pinnacle of success and made its mark in the highly competitive online education industry?

In this blog, we are going to find an answer to the same question by studying the Coursera Business Model. So, let’s get started.

Coursera Stats and Facts: Funding and Major Milestones

• Founders: Andrew Ng & Daphne Koller
• Founded in: 2012
• Headquarters: California, USA
• Business model type: Hybrid
• Company type: Public
• Company valuation (estimated): $5 billion
• Area served: Worldwide

Coursera’s Inspiring Success Story: Learning Without Limits

The app Coursera was launched by two Stanford University professors Daphne Koller and Andrew Ng. Both of them were good friends who shared a passion for technology and computer education. Early in 2012, they thought about starting an online education platform to follow their passion and the rest is history.

Inspired by Udacity, they created their platform and made their self-taught course “Machine Learning” available on it for the masses to access and learn the technology. Their platform and course became a hit overnight with students from around the world registering for the same. More than 104,000 students signed up for it within a few days.

With this insane craze and $16 million in funding from New Enterprise Associates and Kleiner Perkins, the founders had all the validation they required to scale their newly-built application. They quit their jobs at Stanford and invested their blood and sweat in building Coursera.

They always followed the passion to make the world’s best education available to people around the globe -irrespective of the community they belong to. They partnered with world-class universities in the world like Princeton, Stanford, Michigan, and other renowned names like the University of Pennsylvania.

However, by 2016, both of its founders moved to their new venture and new leaders came in to scale the platform. In 2017, Jeff Maggioncalda started leading the company and it has never seen a hard day since then. In the years after 2017, Coursera continued to add more courses, students, and revenue streams to scale the application and business operations.

Then, the world experienced a pandemic, and online education began as an industry that benefited from the pandemic, accelerated its growth during that time. Coursera’s user base grew by more than 70% in the year 2020 alone. The Coursera business model also experienced a spike in revenue and therefore planned to go public to capitalize on the favorable and profitable market conditions.

In 2021, the company IPO’d in the US stock market. At present, it counts 3,800+ courses and 50+ million registered students on its platform, which is still growing with all leaps and bounds.

Must-Have Features to Build an App Like Coursera

Including the right features makes all the difference, especially in today’ competitive world!

Here are some of the crucial features that every EdTech solution like Coursera or Udemy must-have to cater teachers, students and admins alike.

Teacher-Side Panel

• Dashboard – “Dashboard” in the teacher-side panel offers a comprehensive interface to get real-time insights, manage courses, track student progress, access crucial teaching tools and course management tools.

• Pricing Management – It enables teachers to adjust the course fee according to the curriculum.
• Push Notifications – Push notifications allow teachers to share updates on course announcements, deadlines, and important events, ensuring timely updates.
• In-built Chat – This enhances interaction and collaboration between teacher and learner.
• Course Creation and Updates – This feature allows educators to create new content and als update existing ones, ensuring content is up-to-date and relevant.

Student-Side Panel

• Dashboard – This acts like a centralized hub where students can easily track their progress, access updates and resources, view assignments, monitor accomplishments and stay organized.

• Search, Category and Filter –  This feature improves user-friendliness by providing easy-to-use navigation to organize, explore, and find courses with search option, smart filtering tools and categorized content.
• Streaming –  The streaming feature allows students to access and engage with video content along with access to course content through high-quality live lectures, ensuring interactive and dynamic learning experiences.
• Reviews/ Feedback – Integrating this feature allows students to provide valuable review and feedback on courses, mentors and learning experience, ensuring the platform maintains unparalleled educational standards.
• Certification Management – This feature allows students to easily access, track and manage their course certifications.
• Communication and Collaboration Tools – Establishing collaboration tools nurtures students to connect, interact and collaborate with peers and instructors in a collaborative approach.
• Easy Payment Option – Simplify and streamline the payment process with this feature to provide them with convenient payment methods.
• Recommendations – The “Recommendation” feature offers students personalized content suggestions based on their learning history, interests, preferences to guide them towards relevant and engaging learning.

Admin-Side Panel

• Intuitive Dashboard – All-inclusive Dashboard helps in managing and monitoring all aspects like user activities to course progress to learning performance of the platform.

• Manage Notifications – This allows easy managing and personalizing notifications to keep the user updated and better informed.
• User Management – This allows the admin to effectively oversee and manage user accounts, ensuring a seamless and secure e-learning experience.
• Subscription Plan Management – Easy management of subscription plans makes sure flexible and effective learning options for users allowing them to learn at their own pace.
• CMS (Content Management System) – This is important to effortlessly manage and update course content as per the industry curriculum, streamlining content delivery and management.
• Performance Tracking – Integrating this feature in EdTech app development services facilitate better tracking of learner’s performance through data-driven reports and analytics.
• User Support –  In the Coursera business model, “user support” allows optimized management of user inquiries and feedback, along with assisting learners about technical issues and guidance.
• Payment Management – This feature in the admin panel enables easy handling of financial transactions, managing course fees, tracking revenue and much more.
• Commission Module – This will track commissions earned by instructors and partners alike, ensuring fair and transparent revenue-sharing among all stakeholders.
• Notifications –  This feature allows admin to create and manage special promotions, enhancing the affordability and allure of the courses.

How Does Coursera Work: Coursera Business Model Canvas

Coursera provides Massive Open Online Courses (MOOCs) to the masses through its amazing website and mobile applications. You can find courses related to software engineering, finance, data science, and other subjects on its platform.

The platform charges students for getting enrolled in courses and completing the same to get the degree online from the comfort of their homes. However, it provides some free courses as well. Let’s understand how it works in detail by having a look at Coursera Business Model:

1) The platform features MOOCs from many prestigious universities like Duke, Stanford, and many other educational institutes online. Even tech giants like Google and IBM are introducing their courses on this platform. On completing the courses, the platform also provides degrees and certificates to the students.

2) The app targets two different Customer Segments; people wishing to learn and acquire skills/degrees online and educational institutes who wish to provide their offerings to a greater audience. Both segments can access the platform free of charge.

3) The Value Proposition of this platform is that it provides invaluable study material online at little to no cost. It allows people of all types to access high-level education programs, which may otherwise be inaccessible or unaffordable for some people. On the other hand, educational institutions get a chance to react to a greater number of audiences globally through this platform.

4) There are thousands of educational and vocational courses available on the Coursera platform but they do not design these courses. It is just a platform for universities across the world to provide their learning programs to a wider set of audiences. These institutions design the courses and the app’s Key Activity is just to maintain a good relationship with these educational bodies.

5) Educational technology solutions like Coursera don’t depend on any physical resource. The only Key Resources of the platform are its personnel, its robust platform, and its partnership with world-class educational institutes.

6) Similarly, Coursera’s Key Partners are also top-level schools and universities. It has more than 141 such partners across 28 nations around the globe. It also partnered with some tech giants like Google and well-known financial firms recently to provide classes and improve the quality of material available on the platform. All in all, the app’s main focus is on providing more value to consumers.

At the heart of Coursera’s business model lies a passion for reaching and catering to the needs of learners and people who want to excel in their careers and reach their educational goals in life. It enables learners to find and engage with job-relevant, inflexible, and high-quality learning at affordable prices and sometimes free of cost.

Here is Coursera’s Business Model in a nutshell:

• Providing free branded content for learners to access and improve their skills
• This free content attracts individuals at low CAC (Customer Acquisition Cost)
• Some of these learners pay for degrees and certificates, which results in revenue for partners
• This revenue motivates authors and creators to build more content.

So, the Coursera Business Model is a full cycle but you can extract tried-and-tested strategies and leverage a highly profitable model. Let’s now check out the ways using which the app monetizes all its offerings to survive while providing quality to the customers.

Also Read: How To Develop An App Like Coursera | App Development Guide

Coursera Revenue Model: How Does the App Make Money?

The Coursera business model uses not one but many ways to make money. Let’s put the spotlight on all of them:

Coursera Plus: It is a monthly subscription service that the business launched in 2020. Once users buy this subscription, they get access to over 3000 courses, specializations, projects, and certifications. It fee is $49 per month or $399 per year.

Coursera Degree Programs: The app also lets students earn degrees from prestigious universities around the globe. They can study and complete assignments online to earn credentials. It provides many Master’s and Bachelor’s degrees through its partnership with universities and colleges around the globe. The fee of these programs varies between $8,000 – $25,000.

Coursera for Business: This revenue stream of Coursera targets corporate clients and businesses. It promises to train employees of big companies for skills they lack or want to build. According to reports, many fortune 500 companies are using Coursera for Business to keep their resources updated and skilled.

MasterTrack Certificates: These courses cost between $2000-$5000 and are usually portions of Master’s degree programs. This program allows students to acquire knowledge and certificates from prestigious universities online at a fraction of the cost.

Coursera for Government: Even some global government organizations like AIFC Bureau and UNDP are using Coursera to train their employees.

How To Build App Like Coursera – Step-by-Step Process

There’s no doubt, building an EdTech solution requires rigorous planning, execution and iterations for a hassle-free development journey.

Step 1: Understand the Basics – Niche, Target Audience and Market

Select an appropriate niche or market segment that addresses the challenges faced by the users. Knowing your audience will help you craft an EdTech solution that includes features and content appropriately catering to users’ evolving needs.

Plus, study your competition to understand trends, user behavior, and any chances of slip-ups in the E-learning platforms. This will help you differentiate your app by creating some Unique Selling Points.

Step 2: Outline a Robust Business Plan

Craft a thorough business plan that consists of everything from goals, revenue models, marketing approach, and budget for your apps like Coursera. This will act as a roadmap for your educational development solution.

Step 3: Pick the Right Tech Stack

Evaluate the technology stack that fits your online learning platform requirements, consisting of the programming language, database and framework.

Step 4: Craft an Intuitive User Interface

Create an engaging user interface that is easy to navigate and simultaneously eye-pleasing to users providing a flawless user experience. Thus, invest money on responsive design to accommodate users irrespective of the device.

Step 5: Content Strategy and Acquisition

It’s important to plan the content strategy accurately that involves generating original content or purchasing courses from educational institutions and subject-matter experts. Besides, ensure these offerings should be highlighted to attract a behemoth audience.

Step 6: Integrate LMS (Learning Management System)

Implement a dynamic LMS to track course material and student progress, also offer interactive learning tools like assignment or gamification elements.

Step 7: Develop and Test The App

Hire skilled EdTech app developers to build your app. Ensure the partnered development team is experienced in creating EdTech solutions and also test the app with beta testing to collect feedback for improvisation.

Step 8: Roll-out The App in the Market

Launch your educational app alternative on respective app stores, then do use targeted marketing to promote it. Furthermore, you can use social media, collaboration with educational industry forerunners and notably, content marketing.

Step 9: Adhere to Iterative Improvements

Track user reviews and app performance to make data-driven decisions for constant improvements like Coursera business model. Also, comprehend user involvement and behavior to improve the learning experience.

3 Lessons You Should Learn from Coursera Success

There are several things that entrepreneurs should learn from Coursera’s success story. Let’s look at the most important lessons below:

1. You don’t always need a unique idea to build an app

At the time when Coursera was launched, there were several online education apps already popular in the market. In fact, the idea behind Coursera was inspired by Udacity, founded by two Stanford professors Sebastian Thurn and Peter Norvig. They both were colleagues of Coursera’s app founders. While the first-course Udacity offered was about Artificial Intelligence (AI), the Coursera first course was based on Machine Learning (ML). Both apps have their own space and prominence in the market today.

2. A blend of strong business models helps you scale

The app Coursera uses not one but multiple revenue streams to stay profitable. For example, it follows a business-to-business revenue model, marketplace business model, SAAS business model, and also freemium business model through its myriad of offerings. This strategy teaches new entrepreneurs to go out of the box and do everything they can to add value and stay profitable.

3. It is not always necessary to stick to the plan

The app Coursera was initially built with a Utopian vision in mind. That means they did not plan to earn any revenue from the app at the time of launch. But, the team managed to monetize its services later on once it got enough traction from people around the world. And after monetization, the app’s original idea was eliminated from its business plan, which was based on open access to education for everyone and building strong communities through MOOCs.

Also Read: A Quick Guide to Develop a Coding Learning App Like WhiteHat Jr

Wrapping Up

So, that was an inspiring success story of the app Coursera. It is basically a platform that started on the concept of providing Massive Open Online Courses, however, in recent years, the company moved its focus towards profitability and also started offering premium short-course credentials. If you also have any such brilliant idea in mind to build a startup online, reach out to expert developers at Apptunix. We can help you turn your vision into reality.