MasterClass is a popular online learning platform that offers its students presentations and video lectures from celebrities and experts in different fields.
They offer a variety of classes, including cooking, filmmaking, acting, business, and wellness.
The
In this article, we answer the rumored question: “Is
How Does MasterClass Make Money?
MasterClass has a couple of different ways to make money.
One of their most lucrative revenue stream is charging their customers an annual
This allows
The yearly subscription allows
This being said,
The MasterClass Business Model
The
The business has seen significant growth in the last years, with an average evaluation of $800 million.
This growth is thanks to a solid business model that helped
Tiered Pricing System
Similar to other e-learning platforms,
What makes
They charge a significantly greater amount of money than their competitors, such as Udemy or
MasterClass justifies this higher price tag with high-quality videos and celebrity teachers. (See ‘Masterclass Vs Udemy – Honest Review And Worth 2022‘.)
Industry Experts And Celebrities As Instructors
MasterClass set itself apart from other online learning spaces with its focus on celebrity teachers and experts who are the best in their field.
This helps
This being said, celebrities are also extremely costly.
While
Classes Are Aimed At Casual Learners
MasterClass courses are aimed at casual learners who want to know the basics about a topic. There is no career acceleration or progression.
These classes all focus on the instructor, rather than practical advice.
For example, a class with Tony Hawk only teaches you some skateboarding tips and tricks but it won’t teach you how to skateboard like a pro.
MasterClass Funding
MasterClass is a privately funded company. They have raised over $240 million in several rounds of venture capital funding so far.
In 2020, they managed to set their valuation at $800 million after funding series E which was led by Fidelity Investments.
In 2021,
Some of their biggest investment companies are New Enterprise Associates, Atomico, and Institutional Venture Partners.
Is MasterClass Losing Money?
![How Does Masterclass Make Money? [+ Is The Company Fine] 1 Is MasterClass Losing Money?](https://edwize.org/wp-content/uploads/2022/12/Is-MasterClass-Losing-Money.jpg)
MasterClass doesn’t publish any official loss figures. However, the business is privately funded and goes through regular funding rounds during the current growth period.
This means that
The Key To MasterClass ’ Success
MasterClass has seen its valuation triple in 2021. This is a sign of the strong growth of the business.
While the different funding rounds with a variety of investors helped
Here are some of the elements that entice investors to invest in
Education And Entertainment
One of the core ideas of the online education platform is that
This is thanks to the many celebrity experts that
The celebrity hype brings in fans and new interested audiences that
In addition,
The video lessons also allow subscribers to get a glimpse into the celebrity’s work and home life as they are typically filmed in the teacher’s home.
High-Quality
MasterClass focuses fully on providing high-quality courses across the board.
This starts with the professional pre-recorded videos and also shows in the well-designed workbooks that come with every
This premium quality on all levels is what makes
Marketing Through Word-Of-Mouth
Having a number of celebrity instructors on board helps MasterClass accelerate its marketing simply through word of mouth.
Celebrities and world-renowned experts have a large influence in their field and they come with a lot of social media followers.
This has increased
Detailed Market Research From The Start
When entrepreneur David Regier founded this online learning platform, he didn’t start out with an empire. Instead, he wanted to test the market first.
For this, he started with market research. Regier spoke to a lot of people to find out more about their educational experiences.
He asked questions, such as what topics learners are most interested in and how they want to learn.
This initial research helped Regier to create the
However, his first videos weren’t very good quality. That’s why Regier reached out to a variety of influential filming friends to create some Hollywood-quality videos.
MasterClass Expenses
While
Celebrity Payments
One of the biggest expenses for
While the celebrity deals aren’t disclosed, it is believed that
Looking at the many celebrities that
This being said, there is a lot of provenance coming with their famous instructors.
They have their own social media following which opens up great marketing opportunities for
Production Costs
MasterClass creates high-quality videos, brochures, and materials to make up their online classes.
These professional production costs are extremely high as it requires an expensive team to put all these materials together.
Marketing Expenses
Just like any other business,
They are likely to employ a marketing agency or an in-house marketing team which is costly.
Final Thoughts – Is MasterClass Fine?
MasterClass has seen consistent financial growth in the last few years. The business continues to invest its profits back into getting more users onto its platform and on the
With currently 1 million subscribers,