When TutorVista first began, the idea of teaching a student located 13 time zones away seemed farfetched. “Like all start-up ideas, delivering remote lectures by Indian teachers via the Internet seemed impossible until we made it happen. The idea was to build a B2C company in India that was unlike offshoring companies,” said K Ganesh, Founder & CEO, TutorVista, speaking at a fireside chat session in the VCCircle Education Investment Summit 2010 held today at the Leela Kempinski, Gurgaon.
The interview was moderated by Praveen Chakravarthy of the Unique Identification Authority of India (UIDAI), Planning Commission, Government of India.
'For heaven’s sake, do something simpler'
As he began to build this concept, Ganesh faced manifold issues. Nobody had done it before, at such a scale. Also, it was an Indian company, with Indian teachers living in Tier-2 and 3 cities and towns. Sequoia Capital’s MD K P Balraj who was on the board of TutorVista, offered this advice in the early days: “For heaven’s sake, do something simpler.”
Ganesh was also warned about the difficulty of managing teachers in Madurai or Solan remotely, the improbability of them logging on at 2 am to teach American students and the unavailability of PC support in smaller towns in India. But, he managed to crack the code finally and today, Bangalore-based TutorVista has 20,000 students registered with its online tutoring service, 2,000 teachers and records 6.5 million visitors. The company is now looking to launch in the UK and Australia.
Remote versus personal tutoring
Personal tutoring in the US is a costly affair, with tutors charging $40 per hour. TutorVista’s model would shrink this from $40 per hour to $100 per month, topping it off with unlimited training in all subjects. With Balaraj’s help, the company had no trouble raising $2 million from Sequoia Capital in June 2006 and soon after, raised its second round to the tune of $13 million. The backing of Sequoia Capital, which has backed companies like Google, also convinced American parents that TutorVista was a reliable brand, said Ganesh.
The eLance Model
Another lesson learnt was from eLance.com, which, despite a $100-million funding from Kleiner Perkins Caufield and Byers, has not succeeded. “We studied the eLance.com model in great detail and spoke to them too. Their model did not work because of disintermediation in services. The market place model was too involved and personal. We decided to follow a different model, hire tutors,” said Ganesh.
In 2005, the company raised its series B round of funding to the tune of $35 million and used it to acquire Bangalore-based Edurite Technologies in 2007. This was renamed to Manipal K-12 Education and is run by Meena Ganesh. This acquisition helped it target the domestic market.
“We realised early on that a pure TutorVista model would not work for the Indian market considering the mindset of Indian parents and the unavailability of PCs. Edurite already had a base technology platform that we could use to develop solutions for Indian schools,” he said.
In mid-2008, TutorVista launched its school management and operations division where the company runs the school for owners. “There are 15 schools currently being operated by us and we plan to take this to 100 in the next 3-4 years,” said Meena Ganesh, CEO, Manipal K-12 Education.
Besides school management, TutorVista has also entered test preparation market.
With publishing major Pearson investing $12.5 million in TutorVista in 2009, it has since launched a B2B sales model and has added Pearson’s captive base of US students to its roster.
The firm has invested significantly in curriculum and teachers as well as an academic quality delivery system. It also bundles digital content that is linked to syllabus and has integrated infrastructure and tools to help teachers. These tools are sold on an EMI basis at Rs 50- 150 per student per month to a school.
Ganesh believes that in India, disruption in the educational sector will come due to use of technology such as content on interactive experiments that effectively replace laboratory assistants.