Online Tutoring Business

The beginning of online tutoring from offshore

The story of how online tutoring got outsourced to India started in year 2000. Biju Mathew, a software  developer, joined as a software engineer in a Silicon Valley start-up in 2000. He found cost of tutoring for his school-going kids in the United States to be prohibitively expensive, whether offline or online, ranging from $40 and $100 per hour.

Mathew realized that this was a problem facing many other families in the US, who seek quality coaching for their children at affordable prices. Mathew started working on launching a online totoring business, based out of Kochi, with seed money from angel investor. In 2004, Growing Stars went online, providing math tutoring at $25 per hour.

Since this genesis, growth of online tutoring from India has paralleled growth of Indian software and services and business process outsourcing industries. Indian online tutor companies are rake in $30 million a year today, and the figure may well grow to $2 billion in three to five years.

The online tutoring companies offer tutors who are available 24 x 7 for one-on-one coaching. Students interact with tutor via online chat sessions and voice. A virtual whiteboard is used for  charts, graphs and diagrams

Opportunity  Analysis

Opportunity was created by the No Child Left Behind Act of Bush administration, which mandates tutoring for students in underperforming schools. The Act aims to improve results by making schools responsible for student performance; if their students do not attain a minimum of grade level in reading and math, the schools may be denied state funds.

To comply with the Act, Schools, have made use of American supplemental education service providers, including e-tutoring companies.. Public libraries have partnered with e-tutoring companies, such as Tutor.com, SMARTHINKING and eSylvan. Under this scheme, schools and libraries pay the e-tutoring company and the students get online tutoring for free. .

Indian companies are leveraging this opportunity with different models. Educomp Solutions and TransTutors, have partnered  with U.S. e-tutoring firms to get work subcontracted from them. The Indian companies bring in the infrastructure and provide tutors from India. The course content comes from the U.S. company, which also performs the marketing,  customer support and student enrolment.

The market is not limited to United States; there is potential opportunity among students in the United Kingdom, Canada, Australia, China and West Asia. The U.S. online tutoring market, is estimated at $300 million , represents over 50% of the global market

TutorVista in Bangalore adopted a innovative strategy. TutorVista has a fixed price of $99.99 per month, which gives unlimited hours of tutoring.  TutorVista has invested has invested 50 man-years and $2 million in developing online tutoring platform and building brand.

TutorVista  has received $18 million in venture funding. Good part of this will be utilized to build partnerships with school districts, schools, libraries and education software companies to get access to a large number of students in each instance.

How to start online tutoring business

To start you will require to assemble following :

  • Qualified Tutors – countries such as India, Pakistan and Philippines are acknowledged for their excellence in Maths and Science subjects, and it would be easy to recruit tutors for lower cost
  • Website – The success of your tutor business requires a website with all feature such as students to create accounts, pay and get credit of tutor hours, book tutors, get tutoring through chat and internet call, tutors to be paid and more .
  • Whiteboard- Whiteboard is a online interactive board which is used during the course of teaching.  A virtual whiteboard allows the use of charts, graphs and diagrams.

Other Market Segments for online training

Online training or tutoring is not limited to school students. Companies need online training too.

On 20 September 2010, Online training software startup Mindflash.com is launched its software platform Mindflash.com, which is portal that small businesses can use to train employees. Mindflash allows participants to upload and share training documents or videos on the web, host  quizzes and games to test employees’ comprehension of the content.

The software manages the entire training cycle – sending training invitations, keeping track of participant’s progress to generating progress reports. Being an online platform, the software is can be used for mobile employees or spread across locations.

License fee starts at $79 per month for up to 20 seats.

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