At Udemy, Online Education Meets the Marketplace

Xconomy San Francisco — 

Imagine that you’re a second-year college student returning to campus in September, only to discover that your school has made some curious changes. Instead of offering just one introductory Spanish course, one calculus course, and one chemistry course, the college now lets you choose from a dozen of each, led by different instructors with different teaching styles.

Imagine further that the course catalog has gone entirely online, and consists of three-minute video previews of each course, plus reviews and ratings from former students. And instead of paying tuition to the school, you’re now expected to pay your professors directly, with the college keeping a small cut.

Amidst such changes, instructors would now be competing for attention and pay—and it would be easy for students to find out which teachers were the best. Within a few weeks, the top teachers would naturally wind up with the largest classes, while there would still be a “long tail” of smaller classes on specialized subjects.

In other words, your school would have been transformed from a medieval semi-meritocracy with a catalog of take-it-or-leave-it courses into a true marketplace.

Of course, no real university works this way. But Udemy does. And the market dynamics behind the company’s lineup of 8,000 technology and business courses are what make it stand out from its competition in the edtech market—both on the casual-learning side, where Udemy’s peers include companies like and Khan Academy, and on the formal-learning side, where the hottest properties right now are massive online open course (MOOC) purveyors like Coursera and Udacity.

Udemy’s courses focus mostly on career skills like Web design, iOS app development, social media, and accounting software. The San Francisco startup announced today that it has served 1 million students since it first began offering online courses three years ago. That makes it a lot bigger than Udacity, which has 400,000 registered users, and means that it’s rapidly catching up with rival training site, which has about 2 million subscribers.

The company also said that its site now supports speakers of nine languages, including Chinese, French, German, Italian, Japanese, Portuguese, Russian, Spanish, and Turkish, reflecting the fact that half of its users are from outside the United States.

Dennis Yang, Udemy’s president and chief operating officer, says his company is growing so fast mainly because it’s an open, competitive marketplace. Prospective students can connect with the sorts of teachers who might never land a university job or be commissioned to make a video series for, but who are nonetheless experts in their fields.

“You don’t have to be a top researcher at a top-100 school in order to teach on our platform,” Yang says. “We believe we are able to uncover great teachers around the world better than anyone else.”

Udemy's most popular courses revolve around business applications and software programming languages.

Udemy's most popular courses revolve around business applications and software programming languages.

Udemy courses are delivered mostly via online video, are usually about 10 hours long, and typically cost about $100. None of the content is produced by Udemy itself, with the exception of a few videos that show instructors how to create their own course materials. Rather, the site serves as a catalog and marketing platform for DIY creators of instructional video, with Udemy taking a cut of either 15 or 30 percent of the tuition dollars, depending on how much marketing help an instructor wants.

There’s a heavy emphasis at Udemy on teaching skills that will help workers advance in their jobs. For example, there are more than 60 courses on mastering Microsoft Excel. Whether there’s really a demand for that many courses on spreadsheets is debatable, but the point is that prospective students can easily find out which instructors have the happiest customers. The top Excel course at Udemy has 43,500 students, while many others have only a few hundred.

Udemy’s top instructors earn a surprising amount of money through the site. I talked with Miguel Hernandez, an animator and Web developer based in Vancouver, BC, who created a 10-hour course on how to script, storyboard, animate, and record product-demo videos using Adobe After Effects and other programs. Hernandez says 2,500 students have completed the course, and that he earned $90,000 the first year it was offered and more than $100,000 the second year.

Hernandez is an accomplished videographer, so he didn’t need help creating the course, but he says he never could have reached so many students if he’d tried to publish it on his own. “If you are really good instructor and you have a really hot course, they go to a lot of effort to market that course,” he says. “They have a strong marketing machine that most individuals don’t have.”

Udemy emerged from the Founder Institute accelerator program in early 2010.The original plan was to teach startup-building tips to entrepreneurs in Turkey, until the product was reinvented as a video learning platform with … Next Page »

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6 responses to “At Udemy, Online Education Meets the Marketplace”

  1. Gurjinder Singh says: is also there. Educators can set up paid courses and launch their MOOCS too.

  2. I think it is a very great post containing valuable information about the online education.Due to high technology-based platform,online learning enable the students to comfortable to catch the vital information about anything from different media.These positive interaction bring more confidence level to students to perform their skills very well.

  3. Good points Wade. Agreed that online courses are a great way for students to supplement their learning with modules of particular interest to them. Udemy does have a lot of Excel courses! It’s very helpful to first think about the niche that is appropriate to you: That makes it a lot easier to find the course that’s right for you. Here’s our advice:

  4. Ben says:

    From poking around on these courses, it appears that there are no assignments and no assessments. The courses are solely video lectures with maybe a forum. I have never taken a college course where there was no work. I don’t feel like I’d learn much without assignments.

  5. J Guilherme Vidotto says:

    Learn C# from the beginning, 69% off for the first 20 students

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