How Chegg built a multibillion-dollar education tech platform

Chegg is on track to make $800m this year by solving students’ problems.

Meet one of the hottest names in education: Chegg, a platform where students tap experts for “24/7 homework help.”

How Chegg built a multibillion-dollar education tech platform

Chegg’s textbook answering service is a student staple — but just one of many tools Chegg offers to help students cheat succeed.

Chegg said it’s expecting $790m-$800m in net revenue this year.

But it started small as a ‘Craigslist for students’

In October 2000, a group of Iowa State students launched Cheggpost, an internet version of a campus bulletin board.

The site struggled, but 2 Iowa MBAs took over after seeing that most traffic was from searches for used textbooks. In 2005, they rebranded as Chegg and shifted focus toward becoming a “Netflix” for textbooks.

In 2010, former Yahoo COO and Guitar Hero CEO Dan Rosensweig joined. After taking the company public in 2013, the new CEO led a broader shift away from textbooks.

In layman’s terms, Chegg went shopping

Rosensweig acquired more than a dozen companies to help turn Chegg into an all-you-can-eat buffet of student services, including:

  • for $11m
  • StudyBlue, a flashcards platform, for ~$21m
  • Imagine Easy Solutions, the company behind EasyBib and BibMe, for $42m
  • Mathway, a math problem solver, for $100m

Basically, things students drool over.

Now, Chegg is getting good grades

In Chegg’s Q1 earnings report, the company announced:

  • Net revenue of $198.4m (+51% YoY)
  • A total of 4.8m Chegg Services subscribers (+64% YoY)
  • The addition of 6m new solutions to Chegg’s Q&A database
  • International subscribers accounted for 33% of new questions

Chegg still needs to solve for cheating

The company has been called a “superspreader” of cheating, and the problem has been exacerbated by the pandemic and at-home learning.

But Chegg is making strides. In January, it launched Honor Shield, a service where professors can pre-submit exam questions to prevent them from being answered during a test.

Sorry, students.

Topics: Education

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