Outlier.org Secures $30 Million in Series B Funding

Outlier.org, a company specializing in accessible and comparatively inexpensive introductory-level online college courses, has announced the successful completion of a $30 million Series B funding round.

Company Origins and Approach

The company was established by Aaron Rasmussen, who previously served as a co-founder at MasterClass. Reports indicate MasterClass is currently seeking new funding, with an estimated valuation of $2.5 billion. Similar to his prior venture, Outlier delivers visually compelling online courses. However, a key distinction is that Outlier students are able to obtain actual college credit for their completed coursework.

Initial Goals and Pandemic-Driven Demand

Upon its launch in the autumn of 2019, Rasmussen articulated a goal of enhancing the affordability and accessibility of higher education. He clarified, however, that Outlier’s focus remains on delivering introductory courses, rather than a comprehensive curriculum.

The current global circumstances, particularly the disruptions caused by the pandemic, have amplified the appeal of this model. Rasmussen noted a significant increase in inquiries from universities interested in collaborating with Outlier, especially as some institutions are facing challenges in student enrollment and are needing to make difficult financial decisions.

University Partnerships and Expansion

“Universities have expressed considerable enthusiasm for high-quality introductory classes,” Rasmussen explained. “Initially, this was uncertain, but many have indicated a preference for concentrating on advanced courses, making Outlier a valuable resource for maintaining student progress.”

To facilitate these partnerships, Anjuli Gupta has been appointed as Outlier’s head of partnerships. Gupta brings extensive experience from her previous role leading university partnerships at Coursera. Rasmussen also suggested potential collaborations with high schools and employers, extending beyond the traditional university landscape.

Production Adaptations During COVID-19

The pandemic also presented operational hurdles for Outlier. Initially, the company had to equip instructors with substantial amounts of cinematic equipment – approximately 500 pounds per instructor – to continue production.

Subsequently, a streamlined production process was developed, involving a small crew setting up the equipment, while the instructor delivers the lesson independently on set. “The instructor is guided by remotely operated cameras and cues, ensuring a directed learning experience,” Rasmussen described.

Course Offerings and Student Support

Currently, Outlier provides six courses, encompassing subjects like Calculus I, Microeconomics, Astronomy, and Philosophy. The company aims to expand this selection to 14 courses by the close of 2022.

Outlier now permits students to enroll in new course cohorts every two weeks, fostering a sense of community despite the pre-recorded lectures. Furthermore, the company has developed customized student support tools to identify and assist students who may be struggling.

Partnerships and Scholarship Initiatives

The partnership with the University of Pittsburgh has been extended to a five-year agreement, granting students academic credit and providing oversight from faculty at the University of Pittsburgh at Johnstown. (However, some faculty members have voiced concerns regarding this arrangement.) A collaborative effort has also been launched to offer $3.8 million in scholarships to 1,000 frontline workers.

Affordability and Financial Accessibility

Each Outlier course is priced at $400, representing approximately one-sixth the cost of a conventional college course. Acknowledging that even this price point may be prohibitive for some, Rasmussen is actively exploring ways to further enhance affordability, including scholarships and monthly payment plans through Klarna (with Outlier covering the interest).

Funding Details and Investor Perspective

This funding round was spearheaded by GV (formerly Google Ventures), with participation from Unusual Ventures, GSV, Harrison Metal, and Gaingels, bringing Outlier’s total funding to $46 million.

“We are deeply impressed by Outlier.org’s commitment to broadening access to education and reducing student debt,” stated John Lyman of GV. “We have strong confidence in Aaron Rasmussen and the founding team’s vision of providing more affordable educational opportunities to millions of students worldwide.”