I spoke at length this morning at my INSEAD Global Entrepreneurship Forum talk about entrepreneurial opportunities in the educational technology space. Today’s Deal Radar post focuses on WiZiQ, an online tutoring technology startup that offers a learning center and an online collaboration tool for teachers and students for a wide range of subjects and grades. The company was founded in 2002 by Harman Singh and Harbir Khurana, who have been involved in e-learning through authorGEN Technologies. They have been creating software tools that help educators teach over the Internet and decided to offer their technologies as a SaaS platform in a bid to grow.
The site has a virtual classroom, Moodle, with two-way audio, text chat, a whiteboard, PowerPoint and PDF document sharing. The whiteboard allows teacher and student to work out difficult problems on the same workspace in real time, addressing one of the most important distance learning obstacles. Teachers or Education Service Providers (ESPs) can build a profile and a learning network as well as increase their earnings through various options: they either tutor, sell course packages, sell one class at a time (e.g. 20 students enrolling in a live, two-hour class for $5 each), sell content (e.g. share high-quality problem solutions as videos for $1 for a week), or sell tests (e.g. share a mock SAT exam for $25 with solutions and analysis). Teachers can decide how much they should be paid for every teaching hour.
Students, on the other hand, can find help for various subjects and also create their own learning networks. Students can choose a teacher they can afford; teachers’ profiles show pricing upfront. However, there seems to be no way to view previous projects for teachers, or rate them, or verify their credentials.
WiZiQ’s virtual classroom works on any operating system and browser and does not require additional software or hardware installation. Further, it can work on a bandwidth of 50 Kbps (audio) and 120 Kbps (video) for uploading and downloading, compared with competitors’ 128 Kbps bandwidth requirement.
While the basic WiZiQ service is free of cost, the premium service, which has advanced features including private chat, audio and video controls in the virtual classroom and private support, is priced at $49.95 per year. Though the service is currently offered free to teachers, the site plans to introduce certain features for a monthly subscription fee.
Though education on the Internet is gaining ground at the moment, the founders initially found it hard to sell their idea. Their SaaS business model with a free basic version was different from the traditional software licensing companies and products present in the market. WiZiQ gained traction in the market by focusing on both students and ESPs. Its user base increased from fewer than 20,000 in June 2007 to more than 140,000 in October 2008. The company has clocked more than 8 million online teaching minutes as of October 2008. The site has 12,000 ESPs and 6,000 virtual classes every month.
WiZiQ’s top target segments are college entrance exams such as the SAT, ACT and Advanced Placement (AP) exams, and graduate entrance exams such as the GMAT and the GRE in the US. In India, it is targeting 10th and 12th grade standardized exams, and the CBSE and ICSE and college entrance exams including the AIEEE, IIT, PMT and CET. Further, in the graduate sector, WiZiQ has materials for exams for the MBA (CAT, MAT), UPSC, and MCA and for English language standardized tests such as the TOEFL and IELTS. The company thinks it has a total available market (TAM) of $1.5 to $2 billion, which is calculated as 25% (commissions) of the total money spent on test preparation in the US and India, and money spent on advertisements of educational products (for its users’ demographic profile) in print, radio, TV and Internet in the US and India.
WiZiQ has raised more than $360,000 so far: $160,000 from the founders as initial funding; a $200,000 Series A with $100,000 from Indian Angels Network, New Delhi (Formerly known as Band of Angels) and the rest from friends and family; and an undisclosed amount in Series B from Educomp Solutions Ltd., India’s largest education technology company. The company is looking to raise more money in the next six to nine months.
WiZiQ plans to grow its student and ESP base in the target market segments (test preparation) and then accelerate revenue realization from its premium services and marketplace commissions. The company will be using channels such as viral user acquisition, SEO, AdWords, and teacher training programs to promote its public sessions, and tests, and focus on getting students to sign up. Further, WiZiQ says it is also open to an acquisition by a large US- or European-based education company that does not have a footprint in the consumer Internet education space.
This segment is a part in the series : Deal Radar 2008