Is the educational space profitable to create an SaaS product?


Is it possible to start a company in the educational space that can reach several million dollars in revenue? Most of the innovation in the space seems to be coming from non-profits like Khan Academy.

Lets say I start an app that is targeted towards teachers and educators in general. Are teachers willing to pay for an app? Or is it the school that they have to get approval from and they get the school to pay for it?


asked Feb 13 '14 at 20:47
Edward Marra
16 points
  • Yes, people do make money in the educational space. I've never created an SaaS product for the market, so I can't answer to that regards. I have, however, created a social network for book lovers that got quite popular up until it was acquired. The primary source of revenue was advertising. And while the per user value is significantly lower than other niches, you can make it up in volume. Also, marketing an educational startup is *far* easier than any other niche I've encountered. – Nishank Khanna 10 years ago

1 Answer


Educational space is very challenging and doesn't operate like other sectors. Revenue in millions is possible for software companies that start very well-funded (example: Knewton) and rely on partnering with very large publishers, already well established in the industry to get to scalable distribution of product - to get it into many schools or organizations.

Educational sector is also very crowded believe it or not. I am in it, and my competitors are everyone from Scholastic to a website run by a single teacher out of their home offering their materials for free (no kidding). That said, the market is large, so competition is natural.

Teachers don't like to pay for anything, and when they pay they compare products and prefer cheaper (or free) options. It's very hard to get schools to pay - most pay with purchase orders and checks, which doesn't work with a renewable model a SAAS business relies on. Getting a district to sign up is mission impossible because each school has its own budget, so giving away your product is the most reliable way to grow a user (not customer) base.

If you are serious about building an edu app, reach out to me via LinkedIn and we can chat more about it in detail.

answered Feb 13 '14 at 21:07
2,835 points
  • Thanks for your feedback. One of the hardest problems we have right now is creating content manually. We've decided to build a product similar to SparkNotes (not exactly the same, but related). It's a huge time sink. Do you use any contractors to create the content for your education site or do you create it manually yourself? – Edward Marra 9 years ago
  • I use SMEs (subject matter experts) to create original content for my site and it's very expensive. Consider licensing out content from other companies (including mine) or partnering with someone to share the cost, it will be cheaper. Consider UGC that's is heavily moderated/curated. I would strongly advise against content not created by qualified educators - educators are not a forgiving crowd when it comes to quality of materials. Reach out to me via or LinkedIn (Lilia Tovbin) to discuss further. – Webbie 9 years ago
  • What's a good place to hire experts like that? Amazon Mechanical Turk might be a low cost option, but would need moderation. We're in the market for some content creation ourselves (but not in the education space). Craigslist seems like another option? – Robert Desantis 9 years ago
  • @Robert, EDU content is different from other content types. I posted ads for freelance help on Craigslist offering flexible schedule and hours and had a very good response each time. I was open to former teachers, but teaching experience in a classroom setting was a must for me. – Webbie 9 years ago

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