Revenue Model – Coursera

Coursera is an edtech startup which offers massive open online courses (MOOCs). The startup works with Universities and Institutes to offer some of their courses online.

REVENUE MODELS

Signature Track – Students pay a flat fee of $49 to take up a course which lands them a verified certificate. This is the oldest and most significant revenue model of Coursera. Coursera shares the revenue (typically between 6-15%) with the University which has produced the course.

Specializations – Students pay for specializations, i.e. a sequence of courses with a capstone project which leads to the grant of a certificate upon completion. The fee ranges between USD 300-600.

Purchase Course – Students pay a fee to get access to graded assignments.

Other models such as paid on-demand classes are also being looked at by the startup.

CONCERNS

Competition – Coursera has been experimenting with a number of revenue models since inception. With the startup failing to monetize its strong user base and with a host of strong competitors entering the market now, Coursera will need to find the right model to generate substantial revenue to be able to stay ahead of the pack.

Revenue Model – Angry Birds

Angry Birds is a puzzle solving game create by RovioEntertainment Ltd. and has more than 200mn active monthly players.

REVENUE MODELS

Freemium – Angry Birds is one of the best examples of a game monetizing through this model. Players can start playing the game for free and the ones who get committed to it (around 5%) end up buying premium features in the app. Rovio does a great job of keeping users interested and engaged through new versions, upgrades and features for users.

Merchandise Sales – Angry Birds has been able to monetize it’s characters through sales of branded merchandise. Some products include Angry Birds iphone covers, t-shirts, lunch-boxes and so on. The sales strategy is a mix of direct sales and other models like franchising and licensing.

Advertising – The game also makes a lot of money in it’s free version through advertising. By not selling the game, as is the case with a lot of games, Rovio is able to reduce the risk of piracy as well as users can start playing for free.

Revenue Model – Evernote

Evernote is a collaborative tool to organize personal and professional projects. It was launched in 2008 and has over 100 million users today.

REVENUE MODELS

Freemium – Users try out the basic product for free and upgrade to a premium plan when they get addicted to it. This accounts for more than 75% of the revenue.

Business Revenue – Business accounts are paid and offer the benefits of individual accounts along with team and admin features.

Evernote had started a Marketplace model, selling lifestyle products to its users. They shut down this service in February 2016.  

CONCERNS

Scale of Revenue – The startup is facing a challenge generating revenues up to the expectations of the investors and other stakeholders. Additional revenue models will need to be built in to achieve this.

Revenue Model – Alibaba (E-Commerce)

Alibaba acts as a middleman, connecting buyers and sellers. It has three divisions under it’s brand, Taobao, Tmall and Alipay. Taobao is a website which connects sellers to buyers and caters primarily  to small businesses while Tmall is designed for bigger merchants. Alipay is a savings and payments wallet for customers.

REVENUE MODELS

Taobao’s Revenue Model – Merchants pay Alibaba for advertising and other services to promote themselves.

Tmall’s Revenue Model – Merchants pay a deposit, an annual fee and a commission fee on sales.

Alipay’s Revenue Model – Vendors pay a fee for every transaction through the service.

Revenue Model – Olx (Online Classifieds)

Olx is an online classifieds startup based in India.

REVENUE MODELS

Google Ads – Banner ads as well as sponsored listings are Google ad products which Olx uses to make money. Banner ads are the big banners which run on top of the classifieds and also on the left side of them. Sponsored listings are the links you see above the organic search results of keywords.

Featured Listings – Classified owners can highlight and upgrade their listings to featured listings to get them to be placed above the free listings. Ad placements are based on algorithms running within the site.

CONCERNS

Limited Revenue – Featured listings tend to be a limited source of revenue as only a few classifieds out of the total get upgraded. Also in a classifieds portal, sellers do not pay listing fees (as compared to ecommerce websites).

Revenue Model - Bookmyshow

Bookmyshow is an online ticketing startup based in India.

REVENUE MODELS

Convenience Fee Charged (85% of Revenue) – The startup charges it’s users a convenience fee over and above the ticket price.

Turnkey Solutions for Events & Sports (10% of Revenue) – Bookmyshow offers turnkey solutions to various events, from generating user interest to selling their tickets online.

Software Solutions (5% of Revenue) – This is the revenue charged from cinemas for the software solutions provided and their maintenance. This software includes online integration and the facility through which users can get printouts of the bookings they have made online.

The startup is also looking at developing an advertising revenue model aimed at production houses.

CONCERNS

Regulation – Regulation can be a cause of concern for the startup, something which has happened in the past as well. Maharashtra Government, in 2013, decided to scrap the convenience fee in the state.

New Competition – Currently the startup is a dominant player in the market, with very little competition. A new big entrant can play with this convenience fee to compete and establish itself.