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We are at a crossroads. At the outset of 2013, unemployment rates are high, math and science test scores are low, there is a global need for technical talent, and a call for entrepreneurs to save America. Pair these forces with improvements in internet connectivity and cloud technology, and you have the perfect storm.
Online educational portal Lynda.com is riding these waves into $103 million in its first round of funding. This massive round, led by Accel Partners and Spectrum Equity, will be used to grow its course database, add learning tools and features, and scale to accommodate the strong demand from individuals and large organizations alike.
Lynda.com offers instruction on software, creative, and business skills. Its library contains 1,500 complete courses with 83,000 instructional videos on practical subjects like web design, data analysis, time management, audio-visual production, and programming. The videos are created by recognized industry experts and produced in professional studios on Lynda.com’s 12-acre campus outside Santa Barbara.
“There is a tremendous need for practical learning,” said CEO Eric Robison in a chat at the VentureBeat offices. “Students are coming out of school with a degree but are not ready for the workplace, or they are out of the workplace for a while and need new skills. The need for technical skills to be competitive is more pervasive today than it has ever been. Lynda.com can be with you at a four-year university, as well as at different parts of your career. Traditional education is changing.”
The company operates on a subscription model. A monthly fee gives users access to the full scope of Lynda’s library to use in anyway they require. This provides a significant amount of flexibility since courses are not purchased on a case-by-case basis and can be followed anytime, anywhere. Individuals can sign up for as little as $20 a month.
Businesses, large corporations, government organizations, and institutions of higher education also use Lynda.com to bolster their training programs. Clients include public and private school, 44 top national universities, more than half of the Fortune 100 companies, 31 U.S. state governments, all branches of the U.S. military, and all cabinet-level departments of the U.S. federal government.
Lynda.com began in 1995 after founder Lynda Weinman wrote a book about web design. The book evolved into live courses in Ojai Valley, Calif., which further evolved into an online educational platform in 2002. It has been profitable since 1997 and last year brought in over $100 million in revenue, 2 million active subscribers. Investors have expressed interest in Lynda.com for years, but with money coming in and a strong user base, the executives did not feel it was necessary. Now after almost 18 years, Robison said it is time to take Lynda.com to the next level.
“We finally got to the point where we can leverage the funds to grow way beyond if we were self-funded,” he said. “The best time to take money is when you don’t need it. The term sheets started out lower, but as we were working through the process, decided it was the right amount. There was a lot of interest for participation and a lot of work that goes into a funding. It is nice not to have to think about having to do it again for quite a while, and all give us the opportunity to be much more visible.”
Online education is becoming an increasingly crowded space with companies like Udemy, Khan Academy, 2tor, Udacity, Pathwright, Ted Ed, CodeAcademy and others taking off. Each has its own unique offering and in many ways, a unique proposition for consumers. However, one major thing they share is that technical and entrepreneurial content is the most popular. It may take a few years, but interest across the board in these types of companies hopefully signals that the times are changing towards a more skilled, self-directed, and innovative workforce.