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Note: this is a repost of the original article, which you can find here.
The first article outlined innovations in the EdTech space and how they can improve learners' outcomes. However, this often requires a tradeoff between quality and affordability.
Ajay Prakash founded EntryLevel, a cohort based e-learning business in late 2020. Its unique approach is its scalability and focus on learner outcomes. An interest in learner outcomes has been a feature of Ajay’s journey since he as 15yrs old.
This approach allows for a combination of quality and affordability, which is the basis of EntryLevel’s ambitious mission to reskill 1 billion people by 2030. I recall the struggles I had getting my first job and would love to see EntryLevel make a difference for so many others.
In this article, I will discuss Ajay’s longstanding interest in education, the EntryLevel solution and its plans for the future.
Index
1) Ajay’s Journey (link here)
2) The EntryLevel Solution (link here)
3) EntryLevel’s Unique Approach (link here)
4) Product Led Growth (link here)
5) EntryLevel and the Evolution of EdTech (link here)
Ajay has a longstanding interest in education, beginning as a high school tutor at 15. He was a teacher who wanted his students to get an outcome from his lessons. This meant taking the time to simplify complex topics.
Ajay saw his university education as a pathway to getting a job. However, he was disillusioned with his university experience. Like many young people, he was unable to make an informed decision when he decided on a 3-4 year Mechanical Engineering degree.
He attributes this to the following:
Ajay feared that he would be unemployed post-graduation, especially when friends who completed their Mechanical Engineering degrees struggled to find jobs.
He attempted to get an internship in his first year of university. This was a daunting task, as those of us who can recall our first job application will empathise with.
It took 60 to 70 emails before he landed an internship at a mining company. He documented his experiences and during his second year, he co-founded Real Skills Education.
Real Skills Education is a not for profit focused on helping STEM/engineering students transition into the workplace through project-based learning. The key aspects of its program are:
After graduation, Ajay had several startup product and technology roles. He is also a serial entrepreneur whose startup experience spanned blockchain, quantum computing and international trade.
He continued to be drawn to education, lecturing in his free time and joining Draper Startup House to work on their education product. Draper has an ambitious global mission to help 1 million entrepreneurs by 2030.
Returning to Australia, Ajay wanted to use his entrepreneurial skills to solve the problems he faced earlier in his career – education and employment. After some experimentation, he founded EntryLevel in late 2020.
Segment Key Points
EntryLevel provides 6-week online courses or ‘Programs’ to help learners reskill into in-demand roles such as Product Management, Growth Marketing etc.
Similar to Real Skills Education, its courses:
Like Draper Startup House, it has an ambitious mission to reskill 1 billion people by 2030. Reskilling provides learners with the skills to transition into a new job.
Such an ambitious goal requires both quality and affordability:
Recall from Part 1 of this series that EdTech businesses need to balance the following 3 factors:
There is typically a tradeoff between quality (completion rates, credential signalling) and affordability. This is because of the need to serve both the course instructor and learner.
The next section will explain how EntryLevel achieves a unique combination of affordability and quality.
Segment Key Points
E-learning businesses typically pay course instructors and institutions 30-40% of course fees. Maven pays nearly 90% of the course fees to the instructors.
EntryLevel’s affordability stems from its focus on the entry level segment. This enables EntryLevel to use mid-level instructors (rather than expensive faculty or experts) to create courses and pay them on an hourly basis (rather than a percentage of revenue).
This effectively makes content costs a fixed cost which EntryLevel can spread across the 6,000 learners per cohort.
As such, EntryLevel’s solution skews towards learner (rather than expensive instructor or institutional) outcomes. Course discounts of up to 95% enable it to attract learners from under-served emerging countries.
Despite this level of affordability, EntryLevel has completion rates of over 50% compared to the 3-6% typically achieved by MOOCs.
EntryLevel achieves these completion rates through its cohort based approach. However, it has scaled its cohorts to 6,000 students compared to the circa 100 students typical in other cohort based course providers.
Within these large cohorts, EntryLevel automates the grouping of learners into teams of 20-30 based on familiarity with the topic and other factors. This maintains the community and engagement that cohort based courses are known for.
Additionally, EntryLevel has an innovative pricing structure where students are refunded their initial purchase on successfully completing the course.
Credential signalling is achieved by:
While it is too early to assess the level of employment outcomes, customer satisfaction is relatively high, with an NPS score of 70.
When taken together, EntryLevel’s unique focus on customer success, scalability and affordability allows it to approach the problem from a product and technology perspective. This makes it ideal for the Product Led Growth SaaS model.
Segment Key Points
See my previous article for a more detailed discussion on the Product Led Growth model.
In summary, this model allows technology businesses to grow faster and more efficiently by designing a product that sells itself.
The key is scalability and attracting a large volume of users whose feedback can be used to continuously improve the product.
The freemium model is a popular product led growth pricing strategy that provides a basic version for free and upsells premium features.
Ajay has designed a version of a freemium model with:
At this stage, a significant portion of revenue comes from forfeited commitment bonds. However, learners forfeiting commitment bonds retain access to the content.
Continuous product improvement will increase completion rates and premium upsells over time, particularly if the courses result in positive employment outcomes.
Note that EntryLevel owns the course IP and content costs are paid back over just 1-2 cohorts. While it is still early, the progressive build out of course content could result in additional (e.g. recurring) revenue streams over time.
Additionally, attracting a large volume of learners will provide the data that EntryLevel can use to form a talent recruitment marketplace, as described in the next section.
Segment Key Points
The broad education industry trend towards improving learner ROI through employment outcomes could see higher education evolve in a similar way to SaaS businesses.
Instead of a large upfront payment (an expensive 4 year degree), a learner could potentially attend university for a much shorter period and add further accreditations or competencies as she/he needs them.
This trend will be powered by closer interaction with potential employers and technology.
Employers typically use Applicant Tracking Systems (ATS). These systems help employers filter candidate resumes based on keywords linked to skills listed on the job description.
With enough data, EdTech companies can connect learners with potential employers by linking learner credentials with the competencies or skills that employers require. EntryLevel's focus on affordability and scale positions it well to achieve this.
EntryLevel’s longer term strategy (when they scale to millions of learners) is to become a marketplace connecting learners with potential employers in exchange for employer recruitment fees. Employers have a greater ability to pay than students.
See my previous article on the evolution of Product Led Growth models, which A16z’s Chris Dixon calls ‘Come for the tools, stay for the network’.
In summary, this is a strategy where the business starts with a tool that attracts enough users to subsequently form a network. The network sustains growth and makes the business more resilient.
For EntryLevel, this could look like:
Recruitment fees represent an additional income stream from corporate customers who have a greater willingness to pay. Learners also benefit from better employment outcomes.
EntryLevel’s mission of reskilling 1billion people by 2030 is ambitious. Its focus on accessibility and employment outcomes is also impactful. It has 30,000 learners to date.
I would have been eager to sign up for its courses as an immigrant coming to Australia for work years ago, and I hope it enables others to make their first steps into a fulfilling career.
Segment Key Points
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