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|Articles - March 2010|
|Friday, February 26, 2010|
William Kelly co-founded Learning.com in 1999 with high hopes that the online education company would revolutionize the way students, teachers and parents communicated with each other.
“The first business plan of Learning.com failed by the summer of 2000,” says the CEO, a 45-year-old Portland native who started his first business — selling ice cream — at age 12.
But rather than go the way of many other dot-coms of the era, Learning.com refocused. The company shifted its technology away from being a means for parents to, say, check on their kids’ homework assignments, to one that improved classroom teaching through the delivery of web-based instructional materials.
A little more than nine years later, Learning.com serves more than 2 million students in 46 states. Its flagship product, a K-8 technology literacy curriculum called EasyTech, has spawned assessment and classroom management tools as well as supplementary programs in math and science. Annual revenue now tops $20 million, and new communication tools, along with an in-the-works parental interface, are keeping Learning.com’s original aims a part of the company’s long-term outlook.
“We took a little roundabout path to get to our original vision,” Kelly says, “but I think we’re back to a much-enhanced, much more realizable version of that original vision.”
A 1987 graduate of Brigham Young University with an MBA from Harvard, Kelly says that Learning.com has been able to capitalize on the evolving education market as it’s expanded to include new technologies and online offerings alongside traditional print materials. A prime differentiator, he says, has been the company’s focus on customer service, which is entirely different for web-based curriculum than for textbooks.
Negotiating a distribution agreement for EasyTech in Texas with the large educational publisher Pearson a few years ago, Kelly says he was continually injecting the idea of customer service.
“I was always getting this quizzical look back,” he says. “Turns out their idea of customer service was an 800 number you call if your books don’t show up.”
For Learning.com, however, customer service means ongoing technical support, new functionality, content updates and more.
“It’s fundamentally different than the way textbook publishers have gone about doing business over the past 100 years,” Kelly says.
Along the same lines, because of the electronic nature of Learning.com’s offerings, the company is able to provide school districts detailed reports on how students and teachers are using content. In a state like Texas, which spends more than $700 million a year on textbooks, such feedback might come in handy not just for maximizing educational results, but for controlling costs as well.
“We’re talking about real money here,” Kelly says, “So to do that in a way that there’s no visibility about how [materials] actually get used is just crazy.”
In addition to its partnership with Pearson, Learning.com has forged fruitful relationships with other partners, including ASUS, a computer notebook manufacturer, and Kendall Hunt Publishing. There’s also EduComp Solutions, an education technology company in India that bought up 51% of Learning.com’s shares for $24.5 million in 2008.
Kelly says the deal was a recapitalization that gave his original investors, some of whom had been in the company for nine years by then, the chance to get out. In the process, Learning.com gained a valuable partner that has provided huge visibility for the company outside of the U.S.
EduComp, Kelly says, “has not been obtrusive” and they have been “phenomenal in terms of supporting our objectives.” The deal has also paved the way for new business for Learning.com in places like Vietnam, the Philippines and India.
All of which, Kelly hopes, will help Learning.com hit the $100 million mark in another five years. Dried-up state budgets have parched new business for Learning.com lately, and despite a flood of stimulus dollars for education, many states and school districts have frozen new spending until they know for sure what they can count on. In response, Learning.com, which already operates on an annual-fee basis, has turned to various new pricing arrangements with customers.
“We’re packaging up multi-year bundles and experimenting with other structures of payment to take advantage of one-time funds,” Kelly says, “because we don’t want to be booted out two years from now.”
Also on the horizon for Learning.com: growing from about 70 employees to 100 in the next two years, adoption of its curricula in more school districts and continued innovation in the classroom.
“At its heart,” Kelly says, “Learning.com is here to help facilitate the transition from the way things are today to the way things ought to be.”
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