$UDMY 📖 IPO S-1 Breakdown

Victor Koch
12 min readOct 5, 2021



  • Online learning platform Udemy Inc on Tuesday filed regulatory paperwork for an initial public offering (IPO) in the United States
  • Stock will be listed on Nasdaq under the ticker symbol “UDMY.”

Over 17,700 free courses are available on the platform. Over 3.7 million free learners have converted to buyers. Over 28 million consumer learners have enrolled in free courses on a wide range of topics taught by a diverse set of instructors in a variety of languages. Over 8,600 global UB customers, including 42 of the Fortune 100

  • The company, which did not share the terms for its offering, was valued at $3.3B during a financing round in November last year. It is expected to go public at a much higher valuation, reports Reuters.
  • Based in San-Francisco, Udemy was incorporated in January 2010 as the digital learning company providing learners access to its online course content via direct-to-consumer or Udemy Business (UB) offerings.
  • The underwriters: Morgan Stanley, J.P. Morgan, Citigroup, Jefferies, Truist Securities, KeyBanc Capital Markets, Baird and etc.
  • Running in losses currently, Udemy has posted a narrowed net loss of $29.4M for its latest six months ended June 30, 2021 compared to $52.5M loss a year ago.
  • Udemy’s President and CEO Gregg Coccari has been serving in the role since February 2019. Previously, Coccari served as CEO of Stella & Chewy’s, Futuredontics, and NetQuote.
  • Udemy is going to be the latest in a string of online education companies looking to list their shares in New York, after Coursera (NYSE:COUR) and Nerdy (NYSE:NRDY) went public earlier this year.

Company overview

Udemy operates a two-sided marketplace where instructors develop content to meet learner demand. Courses can be accessed through direct-to-consumer or Udemy Business, or UB, offerings. The platform provides over 44 million learners with access to over 183,000 courses in 75 languages and over 180 countries. Since inception, more than 73 million users have registered with Udemy.

Udemy courses address learning objectives such as reskilling or upskilling in technology and business, enhancing soft skills, and personal development. The company analyzes data to better determine learners’ needs, helping them match individuals with relevant courses and, within UB, learning paths for a more personalized experience. Customers also receive access to interactive learning tools such as quizzes, exercises, and instructor questions-and-answers, or Q&A.

Udemy Landing

Founders Story

Udemy was launched by Eren Bali, Oktay Caglar and Gagan Biyani in early 2010. In 2007, Udemy founder Eren Bali built software for a live virtual classroom while living in Turkey. He saw potential in making the product free for everyone, and moved to Silicon Valley to find a company two years later.

“Udemy differentiates in two major ways. First, students can learn on their own time. Many other services provide the ability to host live learning with teachers, but it is critical for students to learn via recorded content (videos and written articles) as well. Second, it develops a community around the course. We provide features so students can easily interact amongst each other and their instructor,” said -Gagan Biyani, (Indian-American) Co-Founder of Udemy

  • Founders — Eren Bali, Gagan Biyani, Oktay Caglar

Funding traction, total raised ~$311M

  • Series A — 2010 at val. $9.74M, $0.2416 pps
  • Series B — 2012 at val. $42.13M, $0.5363 pps
  • Series C — 2014 at val. $182M, $1.9755 pps
  • Series D — 2015 at val. $693M, $6.2177 pps
  • Series E — 2020 at val. $2.06B, $15.57 pps
  • Series F — 2020 at val. $3.3B, $24.13 pps

Funds: Norwest Venture Partners, Learn Capital Venture Partners, Insight Venture Partners, MHS Capital, Stripes, Tencent, and etc.

The mission is to create new possibilities for people and organizations everywhere by connecting them to the knowledge and skills they need to succeed in a changing world. The platform, with thousands of up-to-date courses in dozens of languages, provides the tools that learners, instructors, and enterprises need to achieve their goals and reach their full potential.

Udemy believes traditional education and training methods are fast becoming outdated. Technological advancements and novel industries have significantly altered the types of skills required of workers, and lifelong training and continuous skills acquisition are becoming the norm. There is a clear need to expand access to learning across traditional barriers such as geography and social demographics.

Udemy offers a powerful platform for self-placed, non-degree learning regarding hard and soft skills to its customers. When you explore the content broadly, there are 13 categories: development, business, finance and accounting, IT and software, office productivity, personal development, design, marketing, lifestyle, photography, health and fitness, music, and teaching and academics. Each category is further divided into subcategories.

It has a wide range of content and is excellent resources for instructors as well as it provides them with the platform to come forward and sell their designed courses to the people needing the same. Several courses are taught by subject matter experts in languages other than English, including Spanish, French, Japanese, Portuguese, and German.

Talking about the best course in Udemy being sold to the customers, a generic question arises, where do the courses come from? To which let me enlighten, Udemy invites instructors and teachers who want to design courses and sell them on the platform. So, Udemy not just benefits the students by providing them with the in-demand best courses at their screens by few taps, but also provides a platform to the teachers to sell them to the students.

Udemy — Revenue Model

Instructor Fees

There is no fee to create or host courses in Udemy. The firm makes money whenever a student purchases a course.

Consequently, revenue is shared with instructors. Depending on how the student was acquired, a different instructor fee applies.

This edtech Company has three revenue share tiers that it applies to its instructors:

  • Instructor Promotion: The student discovers the course through a coupon or referral link issued by the instructor. In this case, the instructor receives 97 percent of the revenue. An additional administration fee of 3 percent is applied by Udemy.
  • Udemy Organic: Organic sales occur whenever a student browses the e-learning platform and finds a course he/she is interested in. Furthermore, no instructor coupon is used when purchasing the course. In this scenario, Udemy and the instructor share 50 percent of the sales. Udemy charges a 30 percent fee for any sale made through the company’s Android or iOS app.
  • Paid Acquisition: In some instances, Udemy buys advertising slots on other platforms like Google, Facebook, or YouTube. Whenever students buy courses through paid marketing channels, Udemy takes a 75 percent cut of each course sale. Instructors can limit the amount of times and types of channels in which their courses are promoted.

For Business

Udemy For Business, as the name indicates, is tailored towards companies and their employees. Udemy for Business host courses including development, design, IT and software, data science, office productivity, management, marketing, personal development, project management, sales, among others.

Leading companies in India, including Wipro, Tech Mahindra, and Tetrasoft are using Udemy for Business so their employees can learn the latest skills and deliver the most innovative solutions for their customers. “We use Udemy for Business because we want to provide a learning platform for employees across the globe where they can learn anytime, anywhere. With short bite-sized lectures and some of the best professors globally, our employees like learning on the platform because it’s easy to pick up new skills,” says Anurag Seth, VP & Head of Talent Transformation at Wipro, a leading global information technology, consulting, and business process services company.

It offers two subscription plans, depending on the size of the team. The team plan is aimed at learning groups of 5 to 20 users. The company will have to pay $360 per year and user. Consequently, the Enterprise plan is suitable for all teams above 21 or more users. Hereby, pricing is available upon request by contacting it’s sales team. Furthermore, the Enterprise plan offers a few additional features. These include custom categories and learning paths, no language limitation (the Team plan is limited to English only), custom user groups, tracking user activity, Slack integration, and many more.

Udemy — Prices

With so many perks attached to its name, this is another generic question. There are both paid and free courses on Udemy. But to describe it in layman terms, nothing worth comes for free. So, yes the free courses aren’t as up to the mark as the paid ones. One needs to pay for Udemy courses one by one or can get access to more than 4,000 any time with a Business subscription. Unfortunately, the price is a little high, and you need a minimum of five people for a Business account. Some popular online learning platforms feature a membership system, but Udemy is a pay-per-course service. Udemy Courses ranges from $9 to $300, and the company frequently hosts sales.

It accepts international debit and credit cards, e-payments and bank transfers. The company offers a 30-day money-back guarantee.

Market Opportunity

As technological advancements, new fields of study, and novel industries render existing skill sets obsolete, the need for a new model for learning and teaching skills is urgent. According to the World Economic Forum, companies surveyed estimate that around 40% of workers will require short-cycle reskilling (i.e., six months or less), and 94% of business leaders report that they expect employees to pick up new skills on the job.

The shift to online learning has been ongoing for years, and the COVID-19 pandemic has further accelerated this shift. According to the World Economic Forum, 84% of employers surveyed report that the COVID-19 pandemic has increased the need to digitize.

Unfortunately, many of today’s options have a number of shortcomings:

  • Relevance: Traditional learning solutions rely on the so-called publisher model, which involves a lengthy, centralized, and expensive “top-down” development process by multiple levels of editors and reviewers. Udemy believes a top-down publisher model disincentivizes continuous course creation or improvement post-publication because it limits the speed of course development, instructors’ creative oversight over their content, and the cost-effectiveness of localized content production.
  • Breadth: Due to the slower speed and higher costs associated with the publisher model, existing solutions often focus on a few popular learning areas such as technical skills or creative skills. These training options may lack the content breadth and instructor diversity to meet the interdisciplinary objectives of modern learners.
  • Quality: Because traditional providers often lack quality indicators such as ratings, reviews, and past performance, finding high-quality content can prove difficult and time-consuming for learners.
  • Scalability: Existing solutions have proven ineffective at operating on a global scale. Many rely on in-person training and have been slow to leverage technology, making them difficult to reproduce at scale. Other digital solutions, despite being more scalable than in-person training, have also struggled to provide local content for international communities.
  • Affordability: The high cost of learning solutions prevents many individual learners from advancing or upgrading their skills. Likewise, pricing for existing solutions is often standardized globally, further limiting access in many geographies.

The company offers a new approach, one that addresses these shortcomings and effectively connects the global ecosystem of learners to up-to-date knowledge from experts and practitioners around the world. The team is creating a better learning experience.

According to a HolonIQ study, the global online and offline education market was $2.6 trillion across higher education, corporate training, and online learning in 2019. Before the COVID-19 pandemic, the majority of corporate training occurred offline, and Udemy believes that online education is well placed to address the scalability and affordability limitations of offline education. With the increase of internet connectivity, technological advances, and interactive tools at a low cost, they are expecting a massive shift from offline to online.

Based on data from Arizton, they estimate the market opportunity in online learning to be $223 billion. They calculate this estimate by aggregating the global corporate opportunity of $71 billion and the global consumer opportunity of $152 billion in 2021. Udemy believes that the market opportunity could grow to be multiples of today’s estimate as learning continues to transition online.

Competitive strengths

Global distribution and reach with the strong brand value: In 2020 and during the six months ended June 30, 2021, 61% and 61%, respectively, of Udemy’s revenue was generated outside North America. Because the online platform is available globally, curious learners and organizations can easily test content. As these new learners and organizations begin to engage with Udemy, they have the opportunity to quickly and efficiently expand into these new markets by focusing marketing, advertising, pricing, and language customization resources and expanding payment options, which in turn allows them to grow base of individual learners and organizations on an ongoing basis and attract new instructors who create native language courses.

Powerful data insights and analytics: With over 500 million unique visitors from 2018 through 2020, more than 594 million cumulative course enrollments, and in 2020 alone, almost 11 billion minutes of learning, they believe that the volume of the data the platform collects provides meaningful insights into the behaviors and needs of learners and instructors. They leverage that data to provide personalization for learners as well as to promote high-quality and relevant content from instructors.

Growth strategies

  • Successfully executing on land-and-expand strategy
  • Improving quality and relevance of courses
  • Integrating UB offering with employees’ workflow
  • Deliver immersive learning experiences


The biggest risk is competition and the abundance of online educational startups.

Selected consolidated financial and other data

Udemy Revenue Chart

— — — — — —

Who is Victor Koch?

Mr. Koch — a serial entrepreneur and late-stage investor specializing in secondary shares.

Previously: Twilio, Xiaomi, iQiyi, PinDuoDuo, Tilray, Livongo, Agora, Bandwidth, Robinhood, TransferWise, Oatly, Hims, Coursera.

Currently: Kwai, Enflame, Grab, Intercom, FaDaDa, Stripe, Toss, Epic Games, Hai Robotics, Automattic, Fiture, TigerG, Chime, and other

Contact — here, If you are a startup building in this space — email or DM me to be included in this article.

The content was collected from various open sources, approved by companies, and does not provide any one-stop recommendation for the purchase of shares. All data was used for only informational purposes and does not contain insider information that may be malicious or refuted by the company and SEC.

This communication does not represent an offer or solicitation to buy or sell securities. Such an offer must be made via definitive legal documentation by the buyer or seller of securities, please check the SEC rules before buying shares from any stock-suppliers.

Previous articles:



Victor Koch

Serial entrepreneur, accredited investor, and hedge fund manager. Ex-General Partner of Koch Fund