31 – The Biggest Opportunity in Courses (no one mentions)

The Biggest Opportunity in Courses (no one mentions)

Hey

I’ve just got back from my favorite conference in Bangkok called the dynamite circle. 

As always I received one question: “who is your ideal client?”.

Since I’ve done course marketing for close to 10 years, I gave the same response each time. 

Earlier this week I realized that my go-to response is no longer correct. There’s been a new type of client that I have started working with.

It coincides with a huge change in the course space and this brings us to your biggest opportunity.

Courses are now bought and sold. 

No. 

Not in the way you think.

The following groups are investing in them or buying them outright:

  • VCs
  • Hedge Funds
  • Private Investment Groups

Here are few examples.

  1. Investment group looks for Udemy creators. Offers them money to create a similar course for them (which they now own) and part of the deal is that they have the right to ask you to promote it to your audience multiple times a year. This one pays the least. 
  2. VC invests in a creator with a large audience (let’s a million) and now owns shares of the course and the right to use your face (for a number of years) and ability to promote it to your audience. Usually want to see a converting paid strategy and high 5 to low 6 figures in annual.
  3. Hedge Fund wants a number of 7 figure courses in its portfolio. They will pay a multiple of 2-5x for it. Most of these look for branded courses but not ones that use your face. If it’s based on a personal brand, the multiple will be lower and they will want a right to use your face for a few years. 

Why is this important?

If you build up a course to just 20k per month with solid financials that span 2 years. You can exit with a million in the bank (then rinse and repeat).

I’ve personally been approached by a fund to purchase my business so that they can use the services to market their portfolio of courses. If you don’t receive my newsletter one weekend and get a picture of the beach instead. Means I took the offer. 

One caveat: To get the largest multiple these companies want to see a reliable paid acquisition strategy. Let’s say for every $1 they put in they want $4 out. It’s the only way to scale. 


Until next week

Tom

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