Coursera Raises $43m, LMS and MOOC Collision In Learning Platform Market

Today Coursera announced their new round of fund raising, as reported at GigaOm:

Just last year, online education startup Coursera raised $22 million in venture funding, but the Mountain View-based company is topping up its coffers once again.

On Wednesday, the startup said it had raised $43 million in a Series B round of financing from an impressive and interesting group of investors, including education-centric investors GSV Capital and Learn Capital, well-known Russian investor Yuri Milner, the International Finance Corporation (which is the investment arm of the World Bank) and Laureate Education, a for-profit higher education provider formerly known as Sylvan Learning.

Besides the size of the funding, what strikes me is that one of the emerging trends is that MOOCs are becoming more and more of a learning platform, adding many of the basic features of an LMS.

With the new funding, he [Andrew Ng, Coursera co-founder] said, the company plans to focus on several key areas, including:

  • New mobile apps (coming in the next few months)
  • Deeper international expansion through translation and distribution partnerships
  • Opening up Coursera to enable third-party apps and integrations (long term, the plan is to open up APIs, but in the short term they’ll enable university partners to integrate other apps with Coursera)
  • New features to encourage more collaboration between students

When I pointed this out on Twitter, Burck Smith of StraighterLine got it right when he said “Sounds like an LMS”.

Last year I took a little bit of heat when I added MOOC platforms onto the graphic of the LMS market.

There is a new band / category for “homegrown systems” to account for a relatively new trend where organizations, primarily MOOCs for now, are opting to develop their own learning platform rather than adopt a pre-existing LMS.

If you look at this is an LMS market where vendors compete through campus RFPs requiring a boatload of features, then these are separate markets. If you look at this as a learning platform market where different vendors and approaches are vying to be the underlying Internet delivery for online and hybrid courses, with different approaches to revenue models, then the markets are becoming one.

Coursera, Udacity and edX provide minimalist learning platforms bundled with content and marketing for students outside the college walled garden – providing what they perceive as just the necessary features to enable the online courses in question. Clearly there is pressure from colleges and universities for the MOOC providers to add mobile, open integrations, and collaboration features, as indicated by today’s announcement. I have also heard that there is pressure on them to provide grade books, but I do not know if the MOOC providers will go this route.

As I described to Inside Higher Ed based on a previous Coursera announcement:

Phil Hill, an education technology consultant, said Coursera’s announcement represented not just an expansion of colleges that partner with Coursera but an expansion of and change to the company’s business model.

“This could be an indication of the MOOC providers getting much more pressure from their venture capital investors and themselves that they need to find revenue models — and LMS is a revenue model,” Hill said, referring to the learning management systems market.

I’m sure there will be more to come.

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About Phil Hill

Phil is a consultant and industry analyst covering the educational technology market primarily for higher education. He has written for e-Literate since Aug 2011. For a more complete biography, view his profile page.
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6 Responses to Coursera Raises $43m, LMS and MOOC Collision In Learning Platform Market

  1. lauragibbs says:

    Like we need another LMS…

  2. tom abeles says:

    hi Phil

    As I have said, elsewhere, MOOC’s are like the chicken pox or measles. They are manifestations of an underlying etiology. Post secondary institutions at the grade 13-16 level are faced with a problem, the fact that most of that knowledge is public or textbook knowledge which has been codified. Brick-spaced institutions are seeking alternatives such as co-location of business or housing for those who want the experience of a campus community (seniors are an example) and they are reaching out to non- credit oriented knowledge seekers. Virtual alternatives for delivery will have many forms as will the growing alternative to certification and the involvement of content experts, not all of which are tenure track or are tenure track by virtual of following different paths to subject matter expertise.

    Burk is right and has been prescient in his creation of both Smartthinking and Straighterline. As the bar for employment is raised from grade 12 to post secondary and as basic knowledge can be transfered across geo/political boundaries, the nature of an isolated Ivory Tower is being changed by those who inhabit the space-brick or click. Research is also facing some of the same issues.

    It would be interesting to see a serious analysis of MOOC’s using Gartner’s Hype Cycle. But that is just “scratching the itch”. On a global scale, not just in the United States, the post secondary institutions need to deal with the larger problems at hand.

  3. Try finding an [open source] LMS on the Hype Cycle…

  4. The word from course designers and instructional technologists building MOOCs in Coursera and edX is that the interface and tools are not ready for your typical faculty member to use (unlike current LMSs). The current versions are only usable in a team-based course design setting.

  5. Personally, I welcome any investment in developing for a more personalized, mobile, social, engaged and connected instruction delivery where institutions and faculty can easily customize their courses and choose from a rich catalog of innovative interoperable apps that meet their Teaching and Learning needs.

    Having a scalable and highly customizable powerful e-Learning platform that can support multiple familiar instances for LMS and MOOC applications can actually be a good thing for the ever expanding lifelong learning continuum.

  6. Phil Hill says:

    Just a note – most of the comments go into the direct value of LMS or MOOC options as a learning platform. These are all useful, however, part of the issue I wanted to capture is ‘it’s happening’. What does this say about the future market? Will it become more focused on team-based design (or potentially create a niche market)? Does this move create the lifelong learning platform market rather than higher ed specific market we’ve seen for 10 – 15 years?

    Tom makes a good point again that MOOCs are more of a symptom for higher ed than the underlying issue, but will this migration into learning platform space indicate other underlying issues?

    Just some questions to consider.