Skillshare Business Model | How Does Skillshare Make Money?

Skillshare is an online education platform that places a higher emphasis on developing skills than on formal education. Skillshare courses are made up of videos that teach specific skills. 

Some of these abilities are linked to jobs, while others are tied to artistic or recreational pursuits. Skillshare offers numerous courses in visual arts, writing, and design.

Skillshare helps individuals improve their artistic, creative, business, and technical abilities in information technology and productivity. 

There is no accreditation, no collaboration with colleges, and just a few nationally recognized certificates of achievement. Thus, only a small number of Skillshare courses will look great on your resume.

A skillshare program is useful for those without a formal degree or course. If you’re interested in academic accreditation, you’ll find Udacity’s and Coursera’s “Massive Open Online Courses” (MOOCs) a better choice than Skillshare.

Skillshare earns money through monthly and annual subscription payments and referral fees from other products. The business is based on a marketplace approach.

Skillshare was founded in 2011 and has evolved to become one of the largest online learning platforms in the world. Skillshare presently has over 12 million users.

What is Skillshare?

Skillshare is a digital portal that provides access to more than 30,000 video courses. Each course teaches a skill that participants may apply in real life. 

Skillshare specializes in courses relating to the visual arts, such as video game design, literature, and lifestyle. Skillshare also offers courses for these creators, as well as for developers, designers, and writers.

You can find courses that teach artists how to monetize their works. These courses include The Staples of Branding: From Purpose to Product and Social Media Storytelling.

Skillshare Business Model

Skillshare is best described as an educational platform for creative individuals and artists. Skillshare offers technology and web design courses to help authors and artists market their works.

Additionally, Skillshare offers introductions to various tech-related artistic disciplines, such as video game design and film production. For instance, Unreal Engine 4: Introduction to Game Design.

Additionally, Skillshare offers various lifestyle-related courses that teach people how to better their lives through hobbies and art skills.

How Does Skillshare Work?

Skillshare is an online education platform that allows anyone to take or offer online courses. It features thousands of video tutorials on topics ranging from creating your website and blog to designing applications for mobile devices and 3D modeling in animation tools such as Maya.

Students develop relationships with their teachers and classmates by participating in project-based lessons.

The completion certificate will be given to you once the class has been completed. The certificate can subsequently be sent to potential employers or posted to your LinkedIn profile.

Students can learn about various subjects, including music, photography, user experience design, business analytics, and entrepreneurship. Classes are available at all levels, from beginning to advanced.

Skillshare is often distinguished from other creator-based education sites such as Udemy because of its focus on well-known educators. Classes on the site are frequently taught by industry influencers and thought leaders.

The following diagram illustrates the procedure. First, you must either visit Skillshare’s website or download one of the company’s mobile applications (available on Android and iOS devices).

Skillshare Business Model

You then create an account using your email address or social media handle. You can access the full course content by becoming a member of a monthly or annual plan.

A free membership permits you to view all of Skillshare’s free lessons and participate in their projects and discussions.

You may also purchase a corporate subscription, which will give your employees or colleagues access to the course materials.

Skillshare also offers scholarships and discounts, possibly the most noteworthy feature. Students with.edu email addresses, for example, will receive a 50% discount on their membership.

Skillshare Business Model

The skillshare business model is similar to Netflix. Skillshare does not run ads and is entirely self-funded by its members. 

The teachers are compensated with a portion of the membership cost. Whenever a premium member watches a minute of video, instructors get compensated. Some refer to Skillshare as the Netflix of education because of this.

How Does Skillshare Make Money?

Skillshare earns money through monthly and annual subscription payments and referral fees from other products.

Skillshare relies on a marketplace business model, collaborating with independent teachers to meet students’ knowledge needs.

In the section below, we’ll take a deeper look at each of these.

Membership Fees or Subscriptions

Skillshare’s revenue is primarily derived from monthly and annual subscriptions that students can choose from.

Users can subscribe to the service for $19 per month or $99 per year. Every subscription service offers a 14-day free trial period.

Furthermore, teams (from corporations) may register. Signing up more people means a larger discount.

Students have free access to thousands of courses on virtually any subject they can imagine. Students will also be able to participate in class projects.

There will then be a pool of royalty payments for teachers, which is expected to receive 30% of subscription revenue. Students are then allocated money based on the number of hours they have spent on their courses.

Skillshare says new teachers can earn up to $200 in their first month, while more experienced teachers can earn up to $3,000.

Referrals

Skillshare earns money through referral fees for marketing other people’s products in addition to membership revenue.

Members who renew their memberships each year will be eligible for a wide array of benefits. Canva members can save 20% on membership. Adobe Creative Cloud members can save 15%.

Skillshare Business Model

Skillshare does not seek out those items to promote them out of altruism for its customers while this is not proven.

Businesses can pay a commission to users who sign up for a year (or more) since software goods are frequently profitable.

What is the cost of Skillshare? 

Free basic membership of Skillshare is available for 14 days. The premium subscription is $8.25 per month for an annual membership ($99 total) or $19 per month for a month-to-month subscription after the trial period. Our research indicates that those who appreciate online education will find the annual fee well worth it.

Additionally, team discounts are available for those who sign up together; discount memberships are available for Squarespace and Adobe. In keeping with the mission of making education accessible, we offer current students two free months with a valid.edu email address.

There is also a 30% discount on annual memberships until March 31, 2021.

Is Skillshare Free?

Yes, Skillshare offers 2,145 classes for free to new users. The full library of over 30,000 classes is available when you subscribe monthly or annually. 

Teacher compensation is reasonable, as educators should be compensated as well. Teachers receive between 5 cents and 10 cents per minute of viewing time for all membership levels.

Pros of Skillshare

  • You can access thousands of courses for just $14 a month. It is the only online learning platform that offers comparable services.
  • Skillshare offers more than 27,000 courses in many different subject areas. You get a great deal of knowledge.
  • You can sign up for a free 30-day trial of Skillshare to evaluate the service before committing to a membership.
  • The list of excellent classes is still astonishingly large, regardless of how bad some of the classes are.
  • Courses usually include projects, which, in my opinion, make learning more effective and enjoyable.
  • The courses are broken down into brief lessons, and you can progress at your own pace.
  • You can learn on the go using Skillshare’s app.
  • The video quality on Skillshare is often at least 720p or HD.
  • There are classes taught by specialists in their disciplines, and some are taught by celebrities.
  • Premium membership on Skillshare gives unlimited access to classes and live sessions.

Cons of Skillshare

  • A certificate is not awarded upon completing a course at Skillshare. So, you won’t be given any papers but rather “only” the skills and information. This is not a “real” education that is irrelevant to me, but it might matter for some potential participants.
  • Skillshare no longer offers certain classes. You can verify the class’s rating from other members and its addition date.
  • When you do not cancel within the free trial period, you will be charged monthly or yearly. If you don’t intend to continue using the service, cancel your subscription before the trial period ends.
  • Several people are initially excited about Skillshare but fail to take action or acquire new skills. You should enroll in a time management class to manage your time effectively and motivate yourself to study and improve many aspects of your life.

What is the Funding and Valuation of Skillshare?

Crunchbase reports that Skillshare has raised $116.8 million in debt and equity financing across nine rounds.

Several noteworthy investors include Adobe, Union Square Ventures, Burda Principal Investments, Spero Ventures, and Spark Capital.

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What is the Revenue of Skillshare?

Skillshare is not required to publish sales or valuation figures to the public as a private enterprise. If the company chooses to liquidate in the future (IPO or sale), the company might do so.

Success Story of Skillshare

Skillshare was started in 2011 by Michael Karnjanaprakorn and Malcolm Ong in New York City.

Karnjanaprakorn, whose father is of Thai ancestry, returned to the United States at the age of ten from South Korea (where his mother is from) (he was born in the U.S.).

From an early age, his parents ensured that he maintained the highest possible marks to attend a prestigious institution.

He finally enrolled at the University of Virginia, where he studied economics and earned a bachelor’s degree.

He rapidly discovered that absolutely nothing he learned in college was transferrable to the real world, leaving him with virtually no marketable abilities.

As a result, he enrolled in graduate studies at VCU Brandcenter. At VCU, he took classes taught by genuine experts who had worked in the occupations they were now teaching.

Karnjanaprakorn’s life changed forever when he volunteered at a charter school in post-Katrina New Orleans.

He witnessed firsthand how the local school system had failed the community’s youngsters, who were frequently from impoverished families and thus unable to afford private tutoring. That is when he realized that his ultimate objective would be to work in the education sector.

But before he could strike out on his own, he needed to brush up on his trade skills. He began his career after graduating from VCU in 2008 at Behance, an online platform for creatives to promote their work.

While Adobe acquired Behance for $150 million in 2012, Karnjanaprakorn had already gone on. He joined Hot Potato as a product manager a year later, in 2009. Again, his tenure would be limited to approximately a year.

In 2010, Facebook bought Hot Potato for a cash payment of $10 million. Karnjanaprakorn remained for a while longer but eventually felt it was time to start his firm.

Simultaneously, he made headlines when he raised $10,000 to enter the World Series of Poker (WSOP) main event to donate the proceeds to two organizations of the donor’s choice.

While this was an effective marketing tactic, he was already hard at work on Skillshare. Karnjanaprakorn hired Ong, whom he met at a few New York City events, to join him as the startup’s chief technology officer.

That is where his prior startup experience might prove advantageous. He observed them working on a product for around nine months on Behance. However, when it was finally released, no one used it.

This experience showed him the value of the so-called lean startup approach, which Eric Ries popularized. Rather than developing the entire product, the creators chose to create seminars on Eventbrite.

Karnjanaprakorn would eventually become Skillshare’s first teacher, conducting a series of poker classes. Following the initial Eventbrite classes, the founders felt confident enough in the idea and product to initiate the funding process.

Zach Klein, whom he met at Hot Potato and who went on to form Vimeo, introduced the team to Chris Dixon, who had previously sold two firms to McAfee and eBay and had recently launched his seed-venture fund, Founder Collective.

Dixon’s Founder Collective led a $550,000 seed round into Skillshare in May 2011. SV Angel, Collaborative Fund, David Tisch, and Scott Heiferman were additional investors.

Skillshare classes were initially conducted face-to-face and exclusively in New York. The team has recruited a variety of instructors who would subsequently conduct group lessons in newly rented locations.

The firm’s limited access policy was implemented to ensure that the product experience was flawless before expanding it to more places. A few months later, the expansion began.

Skillshare reported another $3.1 million in funding in August 2011 from Union Square Ventures and Spark Capital. After securing the initial investment, Skillshare expanded rapidly into additional cities, including San Francisco, Philadelphia, and others.

Early on, Skillshare placed a premium on having only the highest-quality, most skilled teachers lead their programs. For example, as indicated previously, Chris Dixon and Eric Ries presented entrepreneurship workshops attended by thousands of individuals.

Eventually, they determined that growing the firm would necessitate an internet presence. They first introduced hybrid classes in August 2012, which allowed both offline and online students to participate. The site would subsequently be used to share all course materials.

Throughout 2013 and 2014, Skillshare continued to grow its marketplace by adding students and teachers and funding its balance sheet. It raised two further rounds of funding in January 2013 and February 2014, one of $1 million from Zappos founder Tony Hsieh and $6.1 million from Union Square Ventures and Spark Capital.

Regrettably, co-founder Malcolm Ong resigned as CTO in 2013 to pursue other projects.

That same year, Skillshare decided to abandon its hybrid strategy to favor a solely online learning experience. By that point, several of the network’s most prominent professors were earning well over $100,000 per year teaching on the platform.

By 2016, when the firm announced another $12 million Series B round in May, it had reached three million course enrollments. Growth accelerated throughout 2017 – albeit without co-founder and CEO Karnjanaprakorn.

In November 2017, he announced his transition to the role of Executive Chairman, passing the reins to Matt Cooper, who joined the firm a year before as Chief Operating Officer. Cooper has extensive market experience, having spent more than five years in various administrative roles at freelance site Upwork.

Karnjanaprakorn remained at Skillshare for a few more months before launching Otis, an alternative investment platform for art and collectibles.

However, the departure had no adverse effect on Skillshare. The company proceeded to raise capital effectively and grow in response to such infusions of capital. The year 2020, in particular, was exceptionally successful.

As people were forced to quarantine themselves at home, they discovered that they could engage their spare time in online education. As with other online learning platforms such as Coursera or Masterclass, Skillshare increased user engagement. Over the same time, the corporation nearly doubled in size.

Skillshare now employs over 500 employees. Additionally, the platform now has over 12 million registered users.

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Is Skillshare Legit?

Skillshare, on the other hand, is a legitimate instructional resource. The majority of the courses are legitimate but are not college-level courses. 

Skillshare does not have any affiliations with universities and does not provide degree programs. Skillshare courses, therefore, are not accredited by any school.

Skillshare’s focus is on skill-based education, which they hope will be used for personal information and fun. 

The emphasis is on transferable talents rather than degrees. You will gain knowledge through Skillshare, but you will not get a degree or certification.

Skillshare courses, such as Crystal Therapy 101 and Crystal Grids and Sacred Geometry, may be deemed illegitimate due to their frivolity, shallowness, and sophistication.

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