nav
Business Models Business Operations

How Does Udacity Make Money (Business and Revenue Model)

The Udacity business model

Udacity logo
Here’s what you should know:
  • What is Udacity, and how does Udacity work?
  • How does Udacity make money?
  • Selling Courses
  • Udacity for Enterprise and Government
  • Udacity profit and revenue
  • What is the Udacity business and revenue model?
  • Udacity funding, net worth, and valuation
  • Udacity subsidiaries, acquisitions, and exits

How does Udacity make money? Here is a full, in depth, breakdown of their two (2) revenue streams and the different products and services they offer, as well as the Udacity business and revenue model, how much money Udacity makes per year, and how Udacity works.

What is Udacity, and how does Udacity work?

Udacity is an online educational platform that offers nanodegrees programs to individuals, companies, and governments in machine learning, deep learning, artificial intelligence, and more.

Founded in 2011 by David Stavens, Mike Sokolsky, and Sebastian Thrun, Udacity now has more than 14+ million students across 160+ countries on the platform.

So, how does Udacity work? To use Udacity, you can simply visit their website and begin browsing for courses you’re interested in learning.

Once you find something, make sure to check out the course’s syllabus and prerequisites (if any) to see if this is the course for you. If it is, tap on “Enroll now,” choose a plan, and create an account if you haven’t already done so.

Some of Udacity’s competitors include Udemy, Coursera, Khan Academy, MasterClass, Skillshare, and other online course providers.

How does Udacity make money?

According to Udacity, Udacity has more than 14+ million students and 50+ enterprise clients on the platform. So how does Udacity make money off of all these students and enterprises?

Below is a breakdown of how much money Udacity makes and its revenue model. Including all revenue streams and how much they charge for their services.

Here are the 2 ways how Udacity makes money in 2022

Udacity has a revenue model that makes money in two (2) ways; selling courses and offering services to enterprises and governments.

#1. Selling Courses

Udacity makes most of its money from selling courses (nanodegree programs & individual courses) online to the students on its platform.

Udacity offers students two (2) types of payment plans to choose from when choosing any course. Students can pick a pay-as-you-go (monthly plan) or they can pay for the class upfront and receive a ~ 15% discount.

From analysis, it looks like the majority of Udacity courses cost $399 per month and can last anywhere from 1 to 5+ months, depending on the course.

As noted above, Udacity has more than 14+ million students taking courses on their platform. All of which are paying in one of the two ways mentioned above. Which you can see the pricing for below.

How much does Udacity cost?

  • Pay as you go: $399 per month
  • Pay upfront: $678 to $1,695+ depending on how many months the course lasts
Udacity homepage| Udacity Business Model | How Does Udacity Make Money? | How does Udacity work?
Source: Udacity

Note: Udacity has ~100 courses that are 100% free. Though these do not offer certificates.

#2. Udacity for Enterprise and Government

In addition to selling courses to individuals on the platform, Udacity also makes money from the services they offer to enterprises and governments.

Udacity offers a few types of services for these organizations. 1) Employers can work with Udacity’s experts to design employee and corporate training tailored to that company. 2) Or employers can get access for their employees to Udacity’s large platform of more than 15,000+ hours of content from 97+ nanodegree programs & individual courses.

As mentioned above, Udacity has 50+ enterprise clients on its platform. Including companies such as Toyota, Accenture, AT&T, Vodafone, and more.

Udacity profit and revenue

Udacity’s last reported earnings came in 2019 when they brought in $100 million in revenue. Since then, Udacity has not released any official reports in regard to company earnings.

Note: Because Udacity is a privately held company, they are not required to make their annual reporting, such as Form 10-K’s, pubic.

What is the Udacity business and revenue model?

Udacity makes money through a few revenue models that they combine within their company, they are:

  • Subscription business model
  • Transaction based revenue model
  • Business to business (B2B) business model
  • B2B2C (partnerships) business model
  • Mergers and acquisitions (M&A) business model

Udacity funding, net worth, and valuation

According to Udacity’s Crunchbase profile, Udacity has raised $235 million over 6 rounds and has a post-money valuation of $1 billion to $10 billion as of September 30, 2020.

Udacity subsidiaries, acquisitions, and exits

To date, Udacity has made a total of 1 acquisition.