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Background of Udemy

Udemy backstory

Nowadays, distance learning is no longer a surprise. Almost all universities, colleges and even schools switched to this type of educational process at the time of the onset of restrictive measures due to COVID-19. But such a smooth transition would not have been possible without specialized applications that were created specifically for the purpose of obtaining online education.
The history of Udemy dates back to 2007. The founder of this application is Eren Bali.
While living in Turkey, Eren Bali developed software for the virtual presence of students in the classroom. This feature has simplified many communication processes in education. Then the creator of the platform realized that it needed to be made available to the masses. Two years later, Eren Bali, together with Oktay Chaglar and Gagan Biyani, launched a full-fledged software. When the creators of the application realized that it was functioning and completely ready to work, they tried to attract investors.
However, about 30 rejections were received, since the investors of that time did not see the project as promising.
But the idea and the project were saved by practice and users who began to massively use the created system. In just a few months, 1000 instructors created 2000 online courses in various professions and occupations of people. Thanks to this step, there was an influx of users.
In 2010, Udemy saw an influx of over 10,000 users.
Seeing such a response, the founders of the company again applied for investment. And this time, Udemy received financial backing in the form of $ 1 million in venture funding. The further increase in the site's finances is going exponentially:
  • 2011 - attracted additional $ 3 million
  • 2012 - the total amount of financing of the company amounted to $ 16 million
  • 2014 - additional financing was attracted in the amount of $ 32 million
  • 2015 - $ 65 million raised and joint work with one of the online platforms for education (Skillsdox Inc)
  • 2016 - attracted $ 60 million
  • 2020 - attracted $ 100 million
Eren Bali stepped down as CEO back in 2014. At the moment, the online platform is valued at $ 3.25 billion and continues to develop cooperation with different countries of the world and many online platforms that are being created. How did study software manage to become one of the most sought-after applications in the world and hold its position for 10 years? The answer to this question lies in understanding how the Udemy app works and how it makes money.

How an app like Udemy makes money

How an app like Udemy makes money

For apps like Udemy, there are the following ways to make money:
  • Students. Students pay for the online course and interest from the payment goes to the platform, the other part to the teacher. This is the direct income of the application, thanks to which it is able to function. There can be many payment methods for students: direct payment through Paypal, Paytm, GooglePay, Visa, Mastercard applications, banking applications from different countries and other payment systems.
  • Instructor promotion tools. Udemy does not charge professors who decide to host their courses. Any teacher can post as many online courses as they want. However, educators can take advantage of paid promotion tools for the platform to offer their course to more students. There is a fee for this marketing toolkit.
  • Interaction with institutions. Software of this type is capable of presenting its platform in an accessible way for many higher education institutions. Universities and colleges can often run into profits and funding shortages. This is due to the inability to take a larger number of students for training for various reasons:
  1. room capacity;
  2. lack / overload of the main teaching staff;
  3. the remoteness of the educational institution due to which only local students visit it;
And many other reasons that can interfere with the educational process and the attraction of students to an educational institution offline. When an institute decides to introduce distance learning, it will need to choose two paths:
  1. Create software from scratch, attracting students who want to study for their distance courses;
  2. It will turn to existing applications, where the institute can find not only a large audience of students, but also teachers who will conduct online courses on behalf of the educational institution remotely.
In addition to these paths, a learning app can make money through the following tools:
  • Advertising. Both internal (advertising of courses of certain teachers, etc.) and external (advertising from third-party companies).
Before placing an advertisement, you should consult a lawyer. for applications that carry out educational activities, certain types of advertising are not correct, which may be prohibited in a particular country.
  • Collaboration with other platforms. In a world where online learning is beginning to gain the same weight as traditional learning, more and more employers may be interested in students who have successfully completed distance learning. Job search platforms and learning apps can create collaborations. So, for the introduction of top-students who perfectly comprehend the courses of a particular profession, the application can be paid extra by online sites for finding employees.
  • Premium accounts. For an additional fee, students or teachers receive additional privileges in the form of advanced functions.
  • Donations / donations. The platform can create an opportunity for everyone to deposit funds for the purpose of improving the quality of the site and its work;
  • Training of company personnel. Creation of separate courses for company personnel and receiving payment from the management of the company.

How does Udemy website work

How the Udemy app works

To understand the success of the software, it is worth reviewing how it works with teachers and students.
For teachers: Udemy is an open space where teachers from all over the world can enter to teach and earn money. This became possible due to the following algorithm of actions:
  • The teacher registers on the site using any device. During registration, the teacher confirms that he is a teacher (of any country in the world);
  • Next, the teacher needs to write a curriculum for himself before starting to create a course;
  • Then the teacher can take a course from Udemy on how to work with the application or start direct work;
  • The teacher will need to record a video lecture, draw up tests, written and other tasks that give students an understanding of what they are teaching;
  • The teacher can create their own communities within the application, supplementing it with their own courses, quizzes and other materials that can attract potential students to his subject.
For students: Anyone who decides to take a course in the app is considered a student at Udemy. Convenience and comfort of learning create the following software capabilities:
  • The student can access the application through any device that is connected to the Internet;
  • The student can choose a course in any of the subjects and professions existing in the application, choosing between many teachers;
  • By paying for the chosen course, the student can watch it online and solve all the additional materials for the chosen course (tests, quizzes, writing essays, etc.);
  • If a student does not have the opportunity to constantly be online, then he can download a video lesson or a whole course in any convenient way. This will allow you to study the subject offline (however, this does not remove responsibility for passing tests and studying additional materials);
  • A student, if he is not satisfied with the quality of training, can return the money spent for the course according to the Udemy app policy;
  • Upon completion of paid education, the student receives a certificate of completion of the course, confirming his knowledge and competence.
Udemy remains the leader in learning software thanks to the regionality that has been created in the app. Whichever country a professor or student comes from, they will find an audience (and courses) in their native language. Even if the professor speaks only one language, the platform creates subtitles, or the teacher himself does it, wishing to convey his knowledge to a larger audience.

Core features of the Udemy app

Main features of the Udemy app

The main functions that Udemy supports are as follows:
  • Video lectures are the main tool for interacting software with users. By interacting with cloud storage, Udemy can store a large number of video lectures, as well as create the most convenient format for working with video materials for students (subtitles for video, quality settings, download options, etc.);
  • Text lectures - this format is still relevant and exists on the site as an auxiliary one;
  • Audio lectures - they are created on the basis of video lectures and test lectures for users that are able to learn by listening to the material;
  • Quizzes are a way of interaction and consolidation of knowledge on the received course. It can be in the form of a test, essay, short answer recording, problem solving, etc. This tool, in addition to consolidating knowledge by the student and more interactive interaction with the course, allows you to track the level of interest of the audience and the study of courses by the teacher;
  • Subtitling is a feature that allows Udemy to be independent of regional and language barriers in different countries and to train / accept teachers from all over the world. Flexible customization of subtitles is provided by AI and editing by the professors themselves;
  • Coding Exercise - This exercise is used in two ways:
  1. Memory exercises for any course;
  2. Exercises for courses related to computer work (programming, web design, etc.).
The possibility of carrying out such work and attaching them to the course gives the teacher a look at the performance of students and to assess or correct their work. Provides support for this format due to the ability to attach and send files using the method used in online mail;
  • Download lectures - this function expands the learning opportunities, allowing the student to study in any conditions, even if he does not have constant access to the Internet. However, there are some notes here. It is possible to download a lecture in the web application if the course instructor has given permission for it. At the same time, for Android and iOS versions, this function is possible without restrictions (in the mobile version of the site, it is impossible to download lectures). This solution complicates the distribution of the paid course on other platforms;
  • Download certificates of course completion - thanks to the certificates, students confirm that they have completed the course and that they have knowledge in a certain competence. The obtained certificate can be provided at the place of request. And although Udemy does not have the status of an educational institution, thanks to its well-coordinated work and cooperation with many online institutions of the world, the certificate from Udemy carries the same weight as the diploma received after completing certain courses from colleges and universities;
  • Q&A (read and leave questions) is another function aimed at bringing the professor and student closer together. When studying the course, the student can leave questions in the form of comments. This allows the professor to answer them and make clarifications that other course users can read.
  • View reviews - since it is possible to return money for tuition on Udemy, if the course was not useful for the student, the platform introduced the function of reviews for courses and teachers. This option allows students to navigate the choice of professors and improve the quality of their education. For professors, this function gives stimulation to easier, concise and interesting course delivery;
  • Promotional video - this function carries the task of making a short advertisement for the course so that students understand what exactly they will get from buying these lessons and whether they should spend money and time on this particular knowledge;
  • Direct message to your course teacher - this communication does not take place publicly, but directly from student to teacher. This function is carried out using the created chats, voice messages and sending photo and video materials. Also, this function allows you to establish real-time communication for both parties;
  • Managing student and teacher accounts is an electronic personal file of each registered user, where you can track his progress and feedback on performance;
  • Webinars are an opportunity for teachers to conduct live lessons without recording video courses and in real mode. The format supports video conferencing or displays only the teacher so that students can watch the training and ask questions in real time;
  • Tuition fees - the ability to pay for the course without leaving the application and using a wide range of payment systems collected by the software. The payment gateway system allows ensuring their smooth and smooth operation;
  • Search by category - flexible search in the software allows you to find a course in the required professions or subjects, as well as to find courses of a specific teacher;
  • Dark Mode - Designed for students with vision problems. Supported only in Android and iOS applications.
These functions are just a basic list of what is created in the software for comfortable interaction between teachers and students. In addition, there are admin tools, a toolkit created for different versions of the application (web, mobile, Android and iOS). All this allows you to achieve maximum comfort in distance learning.

Success factors of Udemy's business model

Success Factors for Udemy's Business Model

Udemy has been setting the benchmark for online learning apps for over 10 years with its user-friendly format for students and teachers. Having appeared at a time when globalization was building up its strength and an increasing number of companies needed qualified specialists (both a new staff of employees and training in new technologies for an already formed team), the application became relevant almost immediately, as it offered itself to the market.
Udemy offered the market a quick solution to the problem of staff retraining, creating the possibility of distance learning.
But if the proposal was created only for this purpose, then it would quickly lose relevance with the emergence of competitors. The main suggestion that Udemy gave to its users is as follows:
Udemy - providing affordable education for every inhabitant of the planet and in all possible areas of knowledge.
Such an application immediately formed the infrastructure, determined the category of buyers, resources, fundraising and other criteria of the business model.
A key factor in Udemy's success has been to create a “free solution” system for all user parties.
That is, the teachers themselves decide whether to come to the platform or not, and the students themselves choose between the courses of the teachers. This decision allowed Udemy to grow over 40,000 courses and continue to grow and update them as time went on. Students, on the other hand, without feeling pressured to sign up or to be forced to pay for a specific course (as well as fears that they will not be able to refund money for an unproductive course), can take any number of courses in various professions and receive a certificate.
Another equally successful factor in this business model is the partnership strategy that Udemy implements. Udemy is funded through training and partnerships with a variety of online and traditional educational institutions. For investors, this business model means that Udemy delivers quality training and information updates on highly requested online courses. This means that many employees, students, schoolchildren can turn to the platform for advanced training, training and tutoring, which guarantees a profit.
Other success factors revolve around keeping the software running smoothly and keeping Udemy up to date with technology updates. All this allows students to study almost all over the world (at the moment the application is available in 190 countries of the world) and attract more and more new partners and investors.

Top KPIs for Udemy

Top KPIs for Udemy

Business success factors can only be understood by measuring key indicators (KPI). What can be these indicators in a business system like Udemy? The list of key indicators of the application is long, but it is all these statistical criteria that can give an application such as Udemy the answer to the question: "Is the company doing the right thing?"
KPI Udemy:
  • The number of new registered accounts per month;
  • The number of “abandoned” accounts;
  • Who arrived more in a month (students or teachers);
  • The number of students who signed up for certain online courses;
  • The active participation of students and teachers in the course (activity of chats, webinars, quizzes, video views, etc.);
  • The regionality of the arrived users (from which countries the most students and teachers came). This criterion allows you to place relevant advertisements for arrivals from a specific country;
  • Annual student surveys;
  • Average course attendance in real time;
  • The rate of loss of relevance and attendance of various online courses;
  • Number of courses completed;
  • The number of comments under the video, profiles of teachers and courses and their segmentation (how many of them express opinions, and how many asks questions about the course or to the teacher);
  • Popularity ratings for courses and instructors in these courses.
And many other indicators that reflect the interaction of the application, up to the frequency of searches and the moment of leaving an online lesson, video lecture, etc. All of these KPIs allow Udemy to quickly respond to audience demand and tailor internal and external advertising to the needs of each user.

How to start an website like Udemy

How to run an app like Udemy

Launching such an application requires understanding the mission - for whom and for what purpose it is being created. If the answers to these questions are found, then the next steps before creating the application are to:
  1. Collect business information;
  2. Describe the necessary and desired functions of the application;
  3. Describe the desired type of application;
  4. Find a responsible team to implement software creation.

Udemy's target audience

Udemy target audience

Before creating an application, you should understand the target audience and its needs. If the application is based on an educational institution, then its audience is students who can receive either their first education after secondary education, or people who receive a second education and come to study for a laconic and convenient presentation of the material.
If an application with online courses and trainings repeats the essence of Udemy, then the target audience is not only teenage students or master's students, but also people who are already working and want to improve their qualifications, take educational courses for personal development, employers that they want to improve the qualifications of the staff.
Of course, in order to improve their qualifications, people of mature age can turn to a traditional educational institution. However, often it comes to saving time and money, so options like Udemy are becoming more and more in demand.
When creating software, the first thing that business information and strategy should be built from is the target audience. Having defined with it, it will be easier to develop all subsequent stages and come to an understanding of the required set of technical application stack.

Technology stack for an website like Udemy

Technology stack for an app like Udemy

Distance learning applications involve all possible types of applications:
  • mobile site;
  • web application;
  • Android;
  • iOS.
Each of these systems uses its own programming languages:
  • C++
  • Java
  • Kotlin
  • Swift
  • React Native
  • Nodes
  • Laravel
And many others. To determine which language is needed, you need to select a specific system (or set of systems). Next comes the introduction of tools and desirable tools for a concise work:
  1. API is an application integration tool (the way one program interacts with another).
  2. Electronic portfolio - allows you to create an account and track its progress within the application. Watch account reviews, information replenishment, avatar change, etc.
  3. Cloud services. These services store all the information that happens in the software and support its operation in terms of exchanging, managing and retrieving data.
  4. Elastic search. Allows you to navigate the application and quickly find the necessary information for any user. An addition to this tool can be a system for selecting the desired category (settings for exact search by courses, popularity, etc.)
  5. WebRTC. The tool helps you create and use chats, voice messages and real-time video calls within the app, making communication easy. Also WebRTC organizes a staging database.
  6. Payment gateways. This is a generalized concept of different payment methods and systems that can be applied on the site for the convenience of paying for courses “here and now” without leaving the site.
  7. AI (artificial intelligence). Facilitates the collection of statistical data, maintains and implements the work of chat bots, nudges a certain user with the necessary external and internal advertising record, etc.
  8. Video conferencing. Provides the possibility of video communication of users, as well as storage of this recording in the cloud storage.
  9. Video, audio - players. Provide the ability to download materials of the proposed format for their interaction with site users (you also need cloud storage and API for easy use on any device);
  10. Text editors. Essential for writing text materials for study and posting them for reading. Has the ability to place illustrations, graphs, etc. inside the article. When combined with AI, you can achieve reading the article in audio format.
There are a lot of technical stacks for creating a website, but the listed ones are some of the key ones that are required from modern distance learning applications.

Other apps like websites like Udemy

Other apps like Udemy

In order to better determine the set of technical stack and the distinctive feature of the application, it is worth looking at the leaders of the distance learning market and understanding what technical features they have.
  • Udemy is the market leader and its features were revealed in the article;
  • Lynda - has the same wide range of courses and lectures, however, interaction with the application is carried out by a monthly subscription, which allows you to take any number of courses within a month;
  • Khan Academy - this application contains only free courses, but all materials studied there will be of an academic orientation: mathematics, physics, chemistry, computer science, etc.;
  • TED is a non-profit application created with the greater goal of spreading interesting thoughts, inspiring stories, and in many ways a humanitarian bias. Information is presented in the form of short videos for users;
  • Goodreads is a learning app, however it is made up of books. In essence, it is an interactive library that aims to read and describe the experience and information for the reader to remember;
  • Coursera is a learning platform that also offers users to take courses in programming, design, etc. But unlike other distance learning software, this program also has the opportunity to go through a “cycle” of courses combined into one specialization, which aims to give knowledge on the system of classical obtaining a profession, but with a modern approach;
  • edX - This site is partnered with Harvard and focuses on the humanities and natural sciences. And although many courses in the application are free, the user needs to pay for a number of interesting courses.
There are other applications that target education. Those that provide more modern knowledge tend to use paid interactions. The ones that are made on the basis of institutes and provide courses in academic sciences, find profit in partnerships and advertising (together with investments). To what type to come, everyone who wants to create such a site decides for himself. Having decided on the direction, it is worth knowing how the latest directions are created in the field of distance education.

Latest industry trends

Video conferences and distance tests are already familiar to most students and teachers. However, it is worthwhile to understand what is new in the educational process they decide to move to these technologies
  • Online events. Student conferences, webinars, olympiads and many other educational events - all this smoothly goes online. There are also known cases of online creative contests, project defense, etc. Equipping the event and making the event even more fun can be a great idea for student learning applications.
  • Online exams. Any exam for an honest result and knowledge test requires external supervision. Nowadays, technical solutions appear and are being developed in order to give such transparency and the ability to control examinations taken online.
  • Practical training. It consists in the fact that the study takes place during the creation of the project. That is, students, instead of studying practice and passing exams, must pass the finished product at the end of the course, understanding how to apply it in practice and asking questions that they encounter during practical classes. Online training here lies in the fact that the teachers are always in touch and play the role of advisers who later check the created projects.
  • Flipped class. This tendency is for students to do the assignment in the classroom, be able to ask the teacher for help, and teach the whole theory outside the classroom. Such a system is already being applied in offline schools, but it can smoothly flow into online schools.

How to build custom website like Udemy

How to create custom apps like Udemy

When the purpose of an application for distance learning becomes clear, an understanding of the set of technical stacks appears and a distinctive feature of the application being created is formed, it remains to find a team of programmers who can create a project of this scale.
Why look for a team and why is it better not to use “free sandboxes” to create a website?
The answer to this question lies in a responsible attitude to the project. Free sandboxes are often based on the platform that created them. And often, after creating a site, they will forgive the fees for using it.
Free sandboxes have a limited set of site tools. If you want to enter something else, then you will not be able to do this, since the software does not belong to you
You will not be able to expand and strengthen the site in case of success and the influx of users, because the site belongs to you and to strengthen or expand it is a very problematic task.
Turning to a professional development team will ensure that your application will:
  • Independent of third party platforms;
  • It can be changed at your request and you can add new functions to it (as well as delete);
  • Can be located on multiple systems;
  • Capable of modification and strengthening in case of expansion and influx of users;
  • All income from the site goes to you and you manage its customer policy at your discretion.
The very creation of software such as Udemy consists of the following steps:
  1. Planning software architecture. This function is built by specialists based on business data, which was selected by a client who wants to create an application. This is where the formation of what functions are needed in the application and which will be superfluous; what wishes the client has for the program developers, etc.
  2. Early scheduling of the application. The development team of the program describes exactly what manipulations they need to do to establish the work of the described project and in what time frame.
  3. Development of the first version of the application. You can call this stage “pen breakdown”, when the work of the already created application features is being studied, but the general plan has not yet been completed.
  4. Quality assurance and application test. This point is pre-final, when the application passes various tests and all possible problems are identified before putting it into operation.
  5. Delivery of the application and launching its work. The application is ready and able to withstand the influx of users and easily carry out all the functions created in it.

Cost to build website like Udemy

The cost of building apps like Udemy

The cost of creating software for distance learning is tied to the complexity of your idea, the level of quality required and the country of the team that took over the project.
So, if you turn to the US developers, prices will be high, but a quality guarantee is also given. If you decide to contact a team from a number of Asian countries, then the price level will be lower, however, there are often quality claims.
However, when choosing a team that will be engaged in development, it is necessary to take into account the experience of creating various applications from developers. Under this condition, the team will be able to create both a standard application and bring your original idea to life.
Share your project’s scope, timeline, technical requirements, business challenges, and other details you consider necessary. Our team will study them and contact you soon. Let’s make an exciting product together!
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Igor Teterevlyov
Igor TeterevlyovHead of Sales Department