California State University - Monterey Bay
President's Speaker Series
From Bootstrapping Start-Up to Leader in Online Learning: The Lynda.com Story
- Location: Colligan Theater - Tannery Arts Center, Santa Cruz, CA
Content is Queen
What They Did "Wrong"
- husband and wife team
- bad location away from tech hubs
- artist + teacher
- no business plan
- no MBAs -> magazine designer & visual effects artist
- Lynda was 40 when they started
- No funding until year 18.
Bruce's Inspiration 1996
- Let Lynda teach.
- Wanted it to be just the two of them, but that didn't scale.
- Never thought of it as a startup.
Lynda's Inspiration 1996
- Stop traveling so much after book touring.
- Build a career and earn a living in Ojai.
- Create ownership and long career success from books and conferences.
- Art Center College of Design in Pasadena, 1996.
- Wrote Designing Web Graphics for ACCD students.
- Tested in physical classroom in 1996
- Rented high school during spring break, put ad on site and collected money by having people send checks to a PO Box.
- Encouraged to start permanent school.
- Funded with $20K from book royalties.
- Lynda wanted to control everything and that she & Bruce would be the only teachers.
- No management experience. Had to wing it.
- E-Commerce strategy was a PO Box.
- Market vision: books, magazine articles, speaking, word of mouth.
Early Challenges (Video)
- Formidable competitors in training and video space.
- Advantage: "good enough" and "fast enough"
- Competitors could get a video course out the door eight months after
- software came out. Lynda.com could do it in 1 - 4 weeks.
- Didn't have good video recording technology.
- Video editing software was slow and painful.
- Disagreed with each other and internal management.
- Pressure to partner with other companies, but chose not to.
- Internal roadblocks hampered some processes.
- Once achieving revenue of $10MM, hounded by investors, but rejected all offers.
- Outgrew location and ability to recruit talent, so moved to Carpenteria.
Online 2002 - Present
- Subscription service started in 2002.
- Pricing came out of thin air.
- $25 is under the cost of a textbook and affordable for a student.
- Hasn't changed price since.
- Cannibalized DVD/VHS sales.
- People stopped traveling to physical classroom because of dotcom crash.
- Took 4 years to recover numbers from lost DVD/VHS sales.
- Too early to market, before YouTube.
- Found low risk ways to take chances.
- Modeled after books - paid contributors royalties.
- Author friendly, paid monthly.
- Knowledge of industry let them bring on more experienced teachers.
- One to millions is not the same as one to twenty physical classroom.
- Enterprise business inspired by a request from a teacher.
- Now 40% of US universities use it.
- Huge boon to lynda.com and contributors.
- Expand from web design to photography, design, video, business skills, and attracted an entire new audience with each new subject.
- Celebrated with cakes each 1000 users until 14000.
Growing the company
- Online focus only after 2006.
- Expand content areas, wider and deeper than competitors.
- High quality video and sound.
- Wear lots of hats and change hats frequently.
- Pay contributors fast and pay them royalties.
- Treat employees great, good pay, great benefits.
- Push people hard and celebrate successes.
- Opinionated leaders raised the bar for excellence.
- Sponsored local events for visibility and recruitment around Santa Barbara.
- Devise pedagogy about how to teach online.
- Make material easy to understand
- Improve website for security, scale, discoverability, and subscribability.
- Professional marketing -> SEM, SEO, channels.
- B2B sales -> sell to universities, government, and companies.
Investors 2013 - 2015
- Resist investment and waiting increased valuation later.
- Being industry leader and profitable put them in driver's seat.
- More press = more visibility (ironically, mainly from financial press, not education)
- MOOCs at the time were on the cover of TIME.
- Hire more easily.
- Gave employees options.
- Attracted world class investors and board of directors.
- Largest database of job seekers.
- Great culture.
- Good ethics and values.
- Inspiring leadership.
- Grow Lynda.com from a few million to access 400+ million.
- Stuck to vision, even though some people didn't believe they could succeed.
- Followed their passion & did what they loved.
- Better than free, if charging for service. Also Lynda.com courses are the most pirated education courses online.
- Treat customers, employees, vendors, and authors well.
- Low risk ways to test ideas. Iterative, low risk, see what works and what doesn't.
- Leverage expertise, connection, passions.
- Content is queen.
- Benefit from always being profitable.