Varsity Tutors raises $50 million for tutoring platform, Chan Zuckerberg Initiative joins round
Varsity Tutors, which connects students with experts in a wide range of subjects, announced today that it has raised $50 million. Learn Capital led the round, with participation from The Chan Zuckerberg Initiative, which joined existing investor Technology Crossover Ventures (TCV).
Founded in 2007, the St. Louis, Missouri-based startup started as an offline tutor marketplace, which allowed students to request in-home lessons.
“The original business was similar to Netflix’s DVD by-mail business,” wrote Varsity Tutors founder and CEO Chuck Cohn, in an email to VentureBeat. “You’d go to our website and request a tutor come to your home. It was markedly more convenient than driving to a strip mall learning center that provided a Blockbuster Video-like experience that was inconvenient, costly, and one-size-fits-all.”
Later on, the startup built a platform to replicate that offline experience online, providing one-on-one live sessions with an instructor using video, audio, chat, document editing, and more. Sessions can be recorded and are available for playback.
Varsity Tutors offers more than 1,000 subjects, which include algebra, chemistry, GMAT preparation, guitar lessons, writing, and several languages. Cohn says that to date, more than 100,000 students have completed lessons via online, mobile, and in-person instruction. A one-hour lesson costs about $50 on average.
There are currently 40,000 experts on Varsity Tutors, who range from teachers to graduate school students, doctors, and other professionals.
“We have a thorough vetting process that involves a video interview, diagnostic testing, a background check, and other steps to ensure that the tutors who gain access to customers on the platform are of a very high caliber,” wrote Cohn. “And we leverage machine learning algorithms of the video feed to inform our understanding of probability that the tutor would be successful on the platform.”
All tutors on the platform are based in the U.S. Varsity Tutors made its first step towards international expansion last September when it acquired First Tutors, a tutor marketplace in Europe. “That is a distinct business unit today,” wrote Cohn.
Cohn is based in St. Louis, Missouri, where he founded the startup. “The city offers several advantages,” he wrote. “We encounter fewer distractions, cost of living is lower, and it can also be easier to cultivate civic pride. We’ve found that the local community continually supports our growth.” Cohn recently wrote a piece in VentureBeat about what he learned from building a startup outside Silicon Valley.
To date, Varsity Tutors has raised a total of $107 million. But it wasn’t always easy to raise capital from St. Louis, says Cohn. “For many years, we had almost no venture funds reach out. Then, in 2014, after seven years, we hit some sort of critical mass and everyone started to reach out.”
The startup’s $7 million Series A round was led by two St. Louis-based entrepreneurs who had just sold Answers.com. A year later, late-stage venture firm TCV came in, leading the startup’s $50 million Series B round. Maroon 5’s Adam Levine participated.
Today’s Series C is also a $50 million round. Varsity Tutors will use the fresh injection of capital to further develop the product, add new features, branch out into categories outside of tutoring, and expand internationally to markets outside the U.S.
Competitors in the tutoring space include Wizant and Kaplan.
Varsity Tutors currently has just under 500 employees across its offices in St. Louis, Seattle, Phoenix, and Victoria.