This summer has seen two prominent coding bootcamps close because they couldn’t make their business models work. Meanwhile, a major provider of free online educational resources for those learning to code announced new paid options that company leaders hope will make its business sustainable.
Codecademy aced the first part of the Silicon Valley playbook, which says to first attract masses of users. The company claims 45 million people have registered to use its free materials. But they hadn’t solved the revenue part of the equation, says Zachary Sims, the company’s CEO. In fact, back in late 2015 the company got to a point of “almost certain death” unless it found a way to get at least some users to pay. (The company has raised $42.5 million since it started in 2011.)
Sims says that after talking with users, and running quiet tests, they’ve settled on a three-tier set of paid offerings that essentially break the tasks of traditional teachers into distinct parts at different prices. The cheapest option is the ability to get a live person to answer questions by chat when a student gets stuck (that costs $20 per month). The second option is to go through a course with a cohort and attend weekly live video seminars and get assignments graded (for about $200 per course). The highest-price offering includes all of that support, plus the chance to set up a weekly one-on-one video chat with a mentor during the course (for $500 per course).
The company says all of the free resources will remain free.
Sims says what he’s doing is “a completely different business” than in-person coding schools like Dev Bootcamp, which is closing shop at the end of the year. Because Codecademy has no expensive classroom space and is fully online, he says, “from the start our business was designed to scale.”
LaceyBathala is one of the first students to try the new Pro courses, after finding the pilot version of the paid offerings when she was Googling how to learn SQL, a language she needed for a new job.
It took her about three weeks to go through the course, and she frequently used the on-demand help. Throughout her work day, she would take breaks from her duties to go through the course’s short interactive exercises, and she’d finish about one lesson per day that way. “As a working mom of two and wife and wanting to further my career, it was perfect,” says Bathala, who is 35 and working remotely for Microsoft from Plano, Texas.
Of course, Bathala already had a basic understanding of coding. Sims says he hopes the paid versions will also appeal to a broad audience, even those who don’t aspire to be fluent coders but want to understand technology better for their jobs.
It’s not clear how big that “casual coder” audience is. (For every essay arguing that everyone should code, you can find a hot take refuting the idea.) Of course there’s plenty of competition for paid online coding bootcamps. And it will be interesting to see whether people will try to use these low-cost options as a replacement for an in-person bootcamp, which cost an average of $11,400, according to Course Report.
The new paid offerings also turn Codecademy into a competitor to Coursera and Udacity, which started out offering free Massive Open Online Courses but later pivoted to put more energy into paid options.
Codecademy officials say that the pilot phase of the paid offerings over the past 18 months has already brought in $6 million in revenue.
