Alison: First MOOC Platform, Meeting Job Market Needs | Market Based Systems Change Case Study

Alison

First Free Massive Open Online Learning Platform Meets Modern Job Needs Founded by Mike Feerick | Galway, Ireland

What’s At Stake

200 million

people are unemployed globally (source: UN)

1/3

More than 1/3 of global employers indicate they have a difficult time filling roles (source: Recruiter.com)

There are over 200 million people unemployed globally, despite 1/3 of global employers indicating that they have jobs available they are not able to readily fill.

Gaining the skills necessary, and keeping those skills updated, remains prohibitively expensive for many - such as those that can’t afford to attend traditional education institutions, workers in the developing world, those that are unemployed with little disposable income, and small business owners. The frequency of career shifts and significant disruptions to the job market because of forces such as automation, mean that employers regularly need new, reliable measures to search for skilled workers that have the most current competencies.

A tertiary education degree is something that can make a difference: young people who have higher education are more likely to be employed, earn 56% more, and not suffer from depression.

However the majority of youth globally -57%- still cannot access higher education (only 43% of 25-34 year olds earn a tertiary degree) .

Mike Feerick, an Ashoka Fellow (2010) based in Ireland, founded the first platform to offer massive, open, online courses (MOOCs) to fill this gap. The platform, Alison, was launched in 2005 to provide the education and certification necessary to meet the latest demands of the job market and to make sure education and skills opens work opportunity to all, regardless of ability to pay.

Business Model Innovation

In 2001, the internet was still uncharted territory in many ways. It was the middle of the crash of the dot com bubble and more than a trillion dollars of value had been wiped from the market when stock values fell. Optimism about the ability to generate revenue from webpages had just nosedived. Alison’s founder, Mike Feerick, was undeterred.

It took a number of years of bootstrapping and startup mode before Alison became fully self-sustainable. Key to Alison’s growth strategy was to establish multiple revenue streams and strategic partnerships with companies looking for workforce training. Alison’s main revenue streams now include:

Feerick was looking for a way to use the internet to widen access to skills needed in the job market, while generating revenue. And so began the precursor to Alison -Advance Learning- which offered 7 paid IT literacy courses at about 20 Euros per student and 50 students per class; the classes were offered primarily to students in the UK via schools and county councils. In 2005, after 5 years of experimentation, Feerick conceived of a business model that would enable free learning and financial sustainability by charging businesses for advertising and others for premium services such as creating custom courses for government agencies or access to official certificates. After two years of building, Alison was ready to launch the world’s first free, high-quality provider of online learning in 2007.

-and are curated to be specific to the course that the students are taking.

For example, a student taking a course in accounting will be shown an ad for full degree opportunities in accounting as well. A student can also pay a nominal amount to have no advertisements served while they study - a monthly or annual basis

The initial reception when the shift to free courses launched was shock. After announcing that courses were now free, “I got a call back from several [schools and city council’s]” Mike Feerick describes, “who said - ‘you know what, Mike? That’s nice, but we prefer to pay.’”

• Ads, which are 50% of its revenue

• Premium services, such as creating

custom certifications or courses for partners, or issuing official certificates for students for a nominal charge. Official certificates are purchased by 30% of students

In 2009, Microsoft became one of the first external publishers, creating a course to learn how to use Microsoft productivity tools that has since been taken over a million times. Alison gained new publisher relationships for its platform through multiple offerings, including enabling content publishers to earn 50% of revenue from ads, enabling publishers to generate paid leads from the platform, and offering expert advice on e-learning method to publishers to help craft effective courses.

At a Glance Revenue Model • Grants or contracts • Earned income -product or services sales

Innovation • Unaddressed Market • Pricing • Product design • Distribution • Sales and marketing • Creating marketplaces

Alison actively sought new types of applications and partners for its free education model. For example, Feerick looked for relationships with drug courts in the U.S. to offer courses in Alison as an alternative to jail time.

prise status, is a part of what garners the support of its learners worldwide, who promote Alison’s free learning offering across workplaces, education systems and skills training locations.

The innovations in its education revenue-model, certification partnerships, “The reason why more Judges across and quality control of content and stuthe world don’t consider sentencing dent outcomes, allowed Alison to reach people to education,” says Feerick. scale over time. “is that there is no one to pay for it.

Free online courses change that.”

“It took us five years to get our first million [users]” Feerick describes, Alison also attracted partners and “but it only took us one year more students by creating either new certo get our second million. Now, we tifications or “generic” versions of are signing up two to three million well-known certificate programs such people a year.” as ISO 9000 for quality management. It publishwa courses on topical workplace However, Alison is not content with subjects such as Data Protection and the scale it has reached yet relative Cyber-Security. to the size of the demand for affordable, relevant education.

To ensure employers could check the knowledge of potential employees, “A pioneer always starts off someAlison created “flash tests” - quick where. The size of our database tests of 30 random question that could allows us to expand through marbe administered at any time to check the keting new courses to the base quality of a student’s knowledge and if of learners we already have, who students’ knowledge is up to date. end up promoting us far and wide,” Feerick describes. “We are close to 13 In order to ensure the quality of its conmillion online learners now, have tent, Alison leverages an open,crowdover 2 million graduates and one sourced quality control mechanism. thousand free courses. Recently, we The platform coordinates a large, dedireleased a new Careers function on cated volunteer base to gauge the quality the website - allowing anyone to see of courses and enables students students what career possibilities might be to offer large volumes of feedback, comconnected to various courses and ments, and ratings. Alison’s social enter- vica versa. We are only starting. I will be disappointed if we don’t have

a billion people online by 2022!”

critiques traditional learning as “no longer fit for purpose – it is To reach its next level of scale, Alitoo slow, too shallow, too costly son has launched another open com- and inaccessible to the majority.” ponent of their platform - self-pubThe self-publishing approach by Alison lishing of courses by subject matter is designed as a way to keep up with the experts around the world. Anyone who fast-paced change within the workplace, is a subject matter expert can publish which demands that knowledge producon the Alison platform, provided they tion become quicker and more agile to have first completed a course on Alison keep up with changing job trends. on how to publish and on basic online pedagogy (Science of Learning). EnTo reach higher scale, Alison is preparing abling publishers to directly publish on to open themselves up to investor funding. the platform (subject to a quick review by an Alison learning expert to make “In scale terms, Alison is up there sure the right quality has been reached) with the tens of millions of learnis designed to allow Alison to expand its ers with Coursera, Udemy and the publishing offering at a much more rapid Khan Academy,” Feerick advises “but pace than ever before. bear in mind we have done what we have done on less than $2m in While acknowledging that the rates of original investment over the past online course completion are not as 10 years+. We are a very lean ophigh as traditional courses, Feerick is eration. When we plug in serious quick to point out that a student is much capital and management expertise more likely to complete a course they through 2019, it is going to interesthave paid to do rather than one they can ing to see what happens!” access for free on its website. He also

Approach to System Change

Alison was established as the world’s first free, massive open online learning platform, and has scaled to reach over 12 million students, and 2 million graduates through creating new resources, roles, relationships, and rules and mindsets to ensure people are trained for the latest job skill needs As one of the largest providers of free education globally, Alison is affecting system changes by becoming itself, the certifier of its courses. Because Alison issues its own accreditation, it can provide its learning for free and learners can access an inexhaustible number of free courses. “What has been missing,” says Feerick, “is a global brand of certifications across all subjects.” Alison hopes to be the definitive source of quality skills training on any subject. By providing the latest training available for free, its goal is to ensure that many more people can access the opportunity that education and skills training presents

System for higher education How Alison is creating systems change to ensure free education for all After

Before Resources

Resources

-Time and focus of students

-Time and focus of students.

-Money for teachers

-Money for teachers

-Tuition fees, government subsidies

-Tuition fees, government subsidies -Course and diploma fees (usually very low compared to old model), money for ads on course platform, government subsidies (can be lower compared to old

Rules & mindsets

model)

- Access to higher education first requires a high-school diploma

-Time and goodwill of volunteer content creators and student evaluators

- Educational content is protected and sold - Certifications can only be trusted if based on accredited appraisals

Rules & mindsets -No restrictions to access to higher education

Roles & Relationships

-Educational content is published under free licenses and spread openly -Certifications can be trusted if based on crowdsourced quality control and flash tests

Roles & Relationships

Before After

publisher

Content creator

Paid expert

Learn

Physical environments like campuses Learning via educators (lectures, seminars)

publisher provide for free Control quality

volunteer subject matter experts

Results -Learning Content: set by academic institutions

self evaluate

-Cost of service: high -Accessibility: low -Certifications for job market limited in range

Content creator

Physical environments like campuses Learning via educators (lectures, seminars)

Learner

Paid expert

Learning institution online, learning via self-paced digital content

Results -Learning Content: lead by job market needs -Cost of service: free / low -Accessibility: high (most people with a internet connection) -Certifications for job market: expanding range of options -Contributions to the Commons: Educational materials at Scale

*This is a simplified systems diagram, and not intended to be comprehensive. The analysis uses the “5Rs framework� developed by USAID. More information can be found here at usaidlearninglab.org

Resources

Roles & Relationships

Before

After

Expensive, out of date traditional learning institutes

Free, massive open online courses (MOOC) platform

Official certifications are only available from specialized providers

General versions of certifications are easily available in one centralized platform

Resumes don’t accurately offer insight into whether job skills are up to date

Flash-tests offer quick, accurate gauges of whether skills and knowledge are up to date

Only accredited universities or training institutes create courses

Subject-matter experts can self-publish as long as the pass Alison training, and anyone can be a subject-matter expert not just those with traditional degrees or accreditations

Experts or administrators approve course content Volunteers and students create crowdsourced quality control

Rules & Mindsets

Quality education requires payment

It’s possible to have a business model that also delivers quality, free education

The Impact

·

·

Partnerships with entities who would not traditionally create courses but are engaging Alison to provide up to date skills training for their workforce include Ireland’s National Health and Safety Executive to develop courses focused on health standards, WHO to produce IT literacy courses in French and multilanguage courses on Ebola, and the U.S. Department of Labor to offer free Alison e-learning programs through their unemployment websites for prospective job-searchers seeking to increase their skills Alison now hosts more than 1,000 classes, 12+ million registered learners and 2 million graduates. Alison estimates that over 100,000 students have secured new jobs or promotions specifically because of holding an Alison qualification. Many thousands of stories of success will Alison can be reviewed on the Alison website

At a Glance Growth • Joint Ventures/ Partnerships

Open Source • Training/ consulting

路

Completion rates for course participants after joining for more than 10 minutes on a course are 35% (forbes)

路

88% of students surveyed felt learning improved their personal confidence, and 90% said they felt encouraged to study further courses

路

Up to 250,000 to 300,000 new students are registering per month, with ongoing expansion to provide customized content in international markets including Africa, North America, Australia and India

路

Demonstrated the first self-sustainable model for offering free-online courses, reaching sustainability within the first 5 years of launching and with $2 million of investment

Key Ingredients for Success

1 Put Free Access First - it Forces Innovation that’s Good for Business: Providing free, high quality education while being sustainable has been core to Alison’s founding “We are determined make an excellent return of investment for our investors,” Feerick describes, “but we will do that while still putting free learner access first.

It forces us to be more innovative.

My belief is long term, free will be the winning model for the universal scale we aspire to. A free education strategy is not only socially powerful but simply good business strategy.”

2 Be prepared to make major shifts to prepare for scale:

3 Choose investors wisely; ensure they match your social impact goals and stage: In its founding years, Alison chose its investors carefully. “If we had out-andout financial investors,” he describes, “I mightn’t be able to continue the social agenda that I have.” They started with an investment amount - $2 million - that is small relative to the investments in other learning platforms with similar size of users. Once having established its model, impact, and initial sustainability, however, Alison now sees its model and social impact goals as strong enough to now be prepared to go out and raise significantly more money from more investors. Given their credibility and ability to remain profitable while ensuring maximum social impact, Feerick is no longer concerned that it will be difficult to find investors who are will to accept Alison’s “social impact first” approach as feasible.

Feerick is preparing to make major shifts in the product, funding, and staffing model needed in order to reach scale with its platform beyond the 2 million graduates it has already achieved. To generate more content it has created a self-publishing process, it is preparing to open itself up to further 4 Be the Analytical Tortoise: investment, and is making plans to To make sure it did not lose control of shift its organizational size and model. the business, Alison operates a very Feerick describes how “We need to lean business that is very analytically double our staff. Frontend and backbased. end developers, system administrators, designers, publishers, product “Be patient,” Feerick advised. “Stay and marketing managers. Next up we true to your mission. I say to the team want to reach a hundred million ushere that we should be well happy to ers. I will be disappointed if we do not be the tortoise rather get there by 2020. Eventually, I want than the hare. Getting methodicalus to reach 5 billion some day!.” ly better at everything we do every day, our long term success is simply inevitable.”

5 Patiently Persevere - Scaling Impact takes Time: Alison spent over four years with its initial experience in online learning (2001-2004), before conceiving of its new business model (2005) and being able to launch two years later (2007).

It was not for another five years of operation, before it reached its first one million users. However, once it reached that level of scale, it only took one other year to double to two millions users, and Alison now adds a quarter of a million new users per month.

Pitfalls to Avoid

1 Don’t be fooled into thinking that charging for content or controlling all content is the path to success:

2 There are no short-cuts: Getting to where it is today, Feerick advises other social entrepreneurs that it is important to take the long route Alison is unusual in its decision to once it means you can hold true to keep its content free - and in creating the social mission you began with. an open, self-publishing option. Many For fellow social entrepreneurs, it is other learning platforms have shifted important for them to realise that one towards paid courses to establish susunder-used revenue stream is pubtainability, or continue to curate conlishing courses for certification online. tent based on partnerships with eduProviding membership with courses cational experts. For Alison, however, about its core aims and expertise can its commitment to remaining free has be a separate revenue stream in itself. driven its innovation in finding new Once there is a volume of learners partners and revenue streams, and coming to study a course, the revenue also pushed it to innovate with a way will follow. “Think outside the box,” to serve even more students around Feerick advises. the world - by enabling self-publishing. In other words, opening up has been one important key to Alison’s scale of impact to date, and its strong, continued trajectory for growth.

“Most social entrepreneurs are experts in something. Share that expertise as a means of part funding your mission -and keep adding courses to feed and educate your audience!”

-Mike Feerick

Acknowledgements ❏

Authored by Reem Rahman, Olga Shirobokova, Odin Mühlenbein, Nadine Freeman and Mark Cheng for Ashoka Globalizer

❏ Interviews by Ken Banks (FrontlineSMS), Michael Feerick (Alison), Steve Song (VillageTelco), Dr. Devendra (Aaravid Eye Care Systems), and Tristram Stuart (Toast Ale).

Creative Commons creativecommons.org/licenses/by-sa/4.0 Licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.