Online course provider Simplilearn eyes B2B clients for profits in FY18

Says it's cheaper to tap companies as they redeploy the same workforce rather than hiring new people

Simplilearn, an online platform that aids reskilling of technology workers, has pivoted to serve more business clients rather than individuals seeking to get certified in new technologies, as the cost of consumer acquisition has hit unsustainable levels.

The Bengaluru-based firm says it is far cheaper to tap corporates who are looking to reskill existing workers, as they look to redeploy the same workforce rather than hiring new people. Businesses also drive bulk purchase of its online courses and have shown the tendency to be repeat customers.

"If you look at most of the consumer-facing companies, their biggest problem is cost of customer acquisition. Most of the money is taken away by Google, to the extent that it's become unsustainable if someone is only looking at doing paid marketing to get customers," said Krishna Kumar, founder and chief executive officer of Simplilearn.

While the company continues to serve individual customers, it has shifted its focus from onboarding new customers to reaching out to corporate customers. Currently, 30 per cent of Simplilearn's business is driven from corporates, boosting margins and giving it a chance to become profitable this year.

The model has been successful in India and the United States which are the primary markets Simplilearn is focusing on. Moreover, competition from global rivals such as Udacity who function in the self-learning space is lesser when catering to the requirements of businesses, who don't mind spending a larger amount to train their employees in new skills.

Simplilearn has hundreds of corporate clients in India alone, with its biggest customers being Indian information technology (IT) services firms. Kumar says Simplilearn works with three out of the top five Indian IT services firms and trains between 100-200 employees from each of these firms in any given month.

"For corporates, we customise 20 per cent of the material, which isn't that big a change. For us, what has been big is the kind of reporting we do. Companies want data on how many people are finishing the course and to what level are they finishing, unlike individuals who are only interested in knowing how their performance is," added Kumar.

Given these changing requirements for serving businesses, the company is on the lookout for smaller firms to acquire that can help it add new customers, build new content or help improve its reporting. 

Further, Simplilearn is also looking to work with large technology companies to build a curriculum for emerging technologies such as artificial intelligence, on similar lines to the Google-Udacity tie up for a course on self-driving car technologies.