As part of the diagnostic I'm building for Track Changes, I'm mapping all 600+ bootcamps worldwide to benchmark the stages that bootcamps go through in their evolution. It's still early days, but I'm seeing common patterns across providers.
I've primarily focused the diagnostic on bootcamps, but it equally applies to more general online education providers. In the future, bootcamps will be able to use this tool to measure themselves against similar-stage companies and identify which levers to pull to accelerate their growth. That’s the aim, anyway.
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I've created a simple matrix (Figure 1) to help visualize the different growth stages; it shows what appear to be the most important criteria required to reach scale. I’m using “scale” to refer to any provider that can consistently graduate 1,000 students a year.
Figure 1. Bootcamp Maturity Matrix.
Source: Track Changes
In super simple terms, bootcamps have three key levers they can pull to increase revenue.
Expand geographically → either through physical campuses, or online, or by localizing / translating products
Add a revenue steam (e.g., B2G)
Lower admissions barrier to entry → this can be academic or financial. For example, lowering the bar to entry and letting in less motivated or qualified students. Or lowering the financial bar to entry by offering ISAs, loans or deferred payment options.
Doing any of these three things requires a lot of cash. And that usually comes in the form of venture capital funding. In very rare cases you could probably bootstrap the third option.
Lowering the academic and financial admissions barrier to entry is perhaps the cheapest option for adding more students to your bootcamp, but it also has the biggest risk.
If you have fewer high potential students going through your courses, can you guarantee the same level of outcomes at the end? Probably not. As they say: you are what you eat.
Let’s look at a case study showing how one bootcamp navigated growth through these different stages.
Case study - Corndel
Corndel are a UK-based training provider. They are a new model of bootcamp; in our matrix, they are currently at Level 4. They have 2 revenue streams: an apprenticeship business and an enterprise (B2B) business.
By looking at their revenue, year-over-year, we can see that the company moved through four distinct stages to reach its current scale.
Figure 3. Corndel revenue, 2016-2021
Source: Companies House. 2016-–2018 are estimates based on enrollment numbers. 2019–2021 are actuals taken from Companies House filings.
Corndel moved fairly rapidly from Level 1 in 2016, to Level 2 by 2017. Using the Internet Archive Wayback Machine, I can see that between 2016 and 2019, Corndel only had one revenue stream.
This was a B2G offering that meant companies could access the apprenticeship levy to send students on Corndel courses.
Although profit was negative in this period, it looks like they had revenue in the £12m range by the end of 2018, given the number of learners enrolled.
At some point in mid to late 2019, Corndel started offering custom programs to clients, which was a straightforward B2B offering. The lever they chose to pull was adding an additional revenue stream, outside the apprenticeship levy.
This shift enabled Corndel to significantly increase their revenue without adding additional instructors, lowering their admissions barrier or adding operational complexity to their model.
Why did this work? Well, their operational costs didn’t increase as their buyer remained the same.
They were still selling programs to the same clients as their apprenticeship business; it was just the funding source changed.
Whereas the apprenticeship business accessed government funding, their B2B business was funded by the company’s learning and development budget.
Corndel’s instructor costs also didn’t increase substantially because they could switch the same instructors to teach both their B2B and B2G cohorts. They didn’t need to hire and train a raft of new instructors.
And they didn’t have to lower their admissions barrier as any student who didn’t qualify for an apprenticeship scheme was overqualified for an apprenticeship. So the learners who came on to the B2B courses had a higher level of prior knowledge before they enrolled.
All these factors allowed Corndel to move rapidly from a Level 2 to a Level 4 bootcamp by the end of 2020.
This shift to incorporate a new revenue stream saw Corndel almost double revenue between 2019 and 2020.
Sidenote: Covid was likely a blessing in disguise here as it allowed Corndel to expand geographically, taking in students all across the UK (not just in London), without investing in physical space. We saw this unintended benefit at Multiverse too.
More to come on this diagnostic and the matrix. If you have any feedback or thoughts on this, I’d love to hear from you. Maybe you disagree? I’m not precious about this stuff – I’m just trying to make sense of it.
to clarify, I don’t condone eating students. I’m not sure this is the way to grow a profitable business. The LTV doesn’t work out.
So bad for ltv, but, so tasty