Juni Learning connects kids with math and science tutors, but co-founder Vivian Shen would prefer not to be lumped in with other edtech startups, despite the sector’s pandemic-born boom.
“We’re not just in the middle to take a few percentage points off of each side and pretend like we’re delivering value,” said Shen. “That’s not scalable.”
Semantics aside, Shen’s words underscore a truth about live tutoring businesses: Anyone can start one. All it takes is smart friends, eager students and a platform to bring them together.
The low barrier of entry has given rise to a slew of new startups. Some view edtech as a marketplace play, others go the gig economy route, and some are trying to make tutoring as simple as calling an Uber — on-demand and only when you need it.
Juni Learning, co-founded by Shen and Ruby Lee, is entering a fragmented and fatigued market full of better-funded and well-known startups. The startup views itself as a consumer play instead of an edtech startup and raised a $10.5 million Series A back in February to prove it can take a slice of the market.
With only 4,000 active subscribers, Juni Learning is bringing in $10 million in annual run revenue (ARR), compared to $2 million of ARR in March, according to my calculations.
So how is it faring?
A word of warning
In 2005, Andrew Geant was thinking about two-sided gig economy marketplaces. He applied the model to tutoring, thinking he could grow a business from connecting students and tutors online to meet offline. So, Geant and Mike Weishuhn, both recent Princeton graduates, founded Wyzant.
Fifteen years later, Geant jokes that he should have built a marketplace for transportation or hospitality, nodding to the success of marketplace businesses Uber and Airbnb (which both were launched after Wyzant).
Unlike Uber, a live tutoring business isn’t as simple as matching random people and hoping for a good outcome. Everyone has a different learning style, goal, level, personal interest. The nuance hurts startups that seek mass scale.
Sure, you could widen your pool of match teachers, but if you lessen your quality of tutor, you will lessen the quality of your platform. Tutoring platforms have added reviews and star systems to bring quality assurance. Live tutoring startups, despite a low barrier to entry, often fail for this reason: They’re unable to scale consistently while also providing definite outcomes.
In Wyzant’s case, it viewed scaling as a slow and market-by-market move. Over time it was able to bootstrap to $100 million in revenue which brought with it a $21.5 million Series A check from Accel.
“There are 65,000 active tutors on the platform,” Geant said. “But it took two million tutors who came to Wyzant over the years to get there. It’s hard to spin that up overnight.”
Overnight scale, however, is exactly what will separate edtech startups from winners and losers amid the coronavirus pandemic. Millions of students are still learning from a distance, which means live tutoring companies must remain flexible to meet big demand.
‘Our vision is to build a university’
For Juni Learning, flexibility came with a fortuitous check. Juni Learning closed a $10.5 million Series A round in February led by Forerunner Ventures, which closed right before the pandemic had spread through the United States. The round took less than two weeks: Even before the pandemic Juni was growing 200% year-over-year in revenue.
“I am assuming that we would have a different term sheet at this point because the company has grown a lot,” Shen said. “But at the same time … we would have struggled to scale up as quickly as we did in March and April, if we didn’t raise it.”
The capital was used to hire an additional 300 tutors, largely college students, in the past four months. While edtech startups often tap into college students as tutors, the fact that summer internships have been canceled and gap years are taking off is only bolstering Juni Learning’s ability to hire.
In 2018, Juni Learning converted their instructors from independent contractors to part-time employees. The classification allows Juni to go deeper with each instructor, invest in development and give them stable scheduling. All tutors must teach for at least eight hours a week. It’s helping limit churn: On average, instructors stay on the platform for 18 months.
Another way they are scaling is by creating a pre-established curriculum for tutors to minimize friction and onboarding costs. Shen says tutors enjoy not having to create their own curriculum from scratch, which helps with retention and interest. The strategy has helped Juni deliver more than 50,000 classes over the last three months.
Finally, Juni Learning frames itself as a “full-stack experience” for platform, curriculum and instructor information. It builds dashboards to monitor if a student shows up to class, and texts or calls people if they’re not in class to check in.
The back-end support, Shen admits, was the hardest to scale up.
“You can imagine that when you triple or quadruple the number of students on the platform, that gets very unwieldy very quickly,” she said.
Outschool is a live tutoring startup based in San Francisco that is similarly benefitting from the surge in demand for remote learning. Founded in 2015, it went from 80,000 users in February 2020 to over 500,000 users in August. In one week, the startup had more enrollments in classes than it did in 2019. To meet demand, Outschool hired 5,000 teachers to start offering online classes in two weeks.
The company confirmed that, as a result of the COVID-19 crisis, it turned profitable. Amir Nathoo, co-founder and CEO, would not disclose revenue however.
It focuses more on breadth versus depth.
“We provide a much broader range of learning options than Juni, which is focused just on coding classes,” Nathoo said. Students can learn engineering through Lego challenges or Spanish through Taylor Swift songs. Outschool currently lists more than 50,000 classes on its website taught by over 7,000 teachers.
“Our business is also much larger at this stage, probably 10 [times] larger than Juni Learning,” he said, in regards to the amount of teachers listed on the platform.
Still, Shen said some Juni customers use Outschool to supplement their coding education. The cross-pollination between the two platforms shows that customers, at least in the United States, are not yet sold on a single platform.
“Our vision is to build a university, and that entails so many more things than just the professors or the courses you’re taking,” Shen said.
The startup recently reacted to a spike of interest in learning pods, which bring a cohort of kids together for live learning. Juni is providing new math and English curriculums, based on Common Core standards, to augment teachers leading the pods.
When asked, Shen compared Juni Learning’s strategy to one that mirrors fitness company Peloton, instead of Kumon, an edtech learning center business. Peloton, she notes, grew a “category-defining business with scalable quality, software and amazing content.”
It signals that in 2005, live tutoring looked like a marketplace with Uber-like ambition. In 2020, live tutoring looks like a consumer brand with Peloton-like ideology.
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