SaaS Interviews with CEOs, Startups, Founders
1296 3 Metrics 30m MAU Quizlet Tracks As They Pass 1m Paying Customers
10 Feb 2019
Chapter 1: What is the main topic discussed in this episode?
joined Quizlet back two years ago. The company was created in 2006, has since grown to helping over 30 million students on a monthly active basis that students and teachers really learn, educate themselves. Even folks that are out of the field or sorry, they're in the field already out of school helping them.
They've got folks paying, students paying, call it 20 bucks a year, teachers paying 35 bucks a year. Sounds like they've passed about well north of a million customers paying over 100% year over year growth. A team of 100 people in San Francisco at about 32% million dollars raised.
This is the top entrepreneurs podcast where founders share how they started their companies and got filthy rich or crash and burn. Each episode features revenue numbers, customer counts, and other insider information that creates business news headlines. We went from a couple hundred thousand dollars to 2.7 million. I had no money when I started the company.
It was $160 million, which is the size of many IPOs. We're a bit strapped. We have like 22,000 customers. With over 5 million downloads in a very short amount of time, major outlets like Inc. are calling us the fastest growing business show on iTunes. I'm your host, Nathan Latka, and here's today's episode. Hello, everyone. My guest today is Matthew Glatzbach.
He is the CEO of a company called Quizlet. He joined the company 12 years ago at Google, where he was most recently VP of product management at YouTube. Before YouTube, he was on the founding team of Google Apps. Matthew studied mechanical engineering at Cornell and grew up in Fort Wayne, Indiana. Matthew, are you ready to take us to the top?
I'm ready, Nathan. Great to see you. Good to be with you.
All right. I want to know what Quizlet offered you to get you to give up the big gig at Google.
How'd that work? The biggest part of it was the opportunity to have a global impact on the way people learn. So, you know, I loved my time at Google, you know, had a lot of success first building Google Apps and then spent five years at YouTube and doing some great things there.
But the opportunity at Quizlet as the largest consumer learning platform was, you know, really the opportunity to fundamentally change the way people learn. And it was just too good an offer to pass up.
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Chapter 2: What inspired Matthew Glotzbach to join Quizlet?
It's the equivalent to like bottoms up in enterprise sales.
That's exactly right. And then the other effect that we have is we've amassed this really rich, high quality set of spam free educational content. So When you do a search for that content, you're back to me the night before the test going, oh, I need to learn that AP biology stuff.
I do a search on Google and Quizlet shows up number one or number two and I click through and wow, that's exactly what I need to study and I dive right in. So a combination of that viral word of mouth sharing as well as SEO has really driven us to the point that we're at now.
Okay. So this is all great, but we haven't talked about one big thing. And that office behind you is not free in San Francisco. How do you make money?
So it's a freemium business model. So the vast majority of our users use the product for free and have a great product experience. We have an ads model to help offset the costs of that for the free users. And then we have subscription products that are very low price subscriptions for both students and teachers and that upgrade you into more features.
So our Quizlet Plus product, which is our most popular student product, is $20 a year. That's a year, not a month, so less than $2 a month. And with that, you get more advanced features. Obviously, you get ads free, you get offline on our mobile apps, but you also get some advanced creation features that allow you to create and customize the content a little bit more towards you.
And then we also have a teacher offering that's $35 a year that includes all of those features and gives the teachers some additional statistics tracking and allows them to organize their students into classes and that sort of thing.
Okay. Now you joined, so the company founded in 12 years ago, you said, I think in 2006, you joined, you said two years ago? That's correct. Yeah, I joined in early 2016. Okay. And what have you guys scaled to in terms of total kind of students and teachers using you on a paid account? I think you said 5 million, or sorry, you said half of college students?
Yeah. So we're now over 30 million users using us, actively studying on the platform on a monthly basis. And that number is growing rapidly, you know, 50% plus year on year.
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Chapter 3: How does Quizlet impact students and teachers?
And we're seeing a lot of expansion internationally. So Quizlet's been around the U.S. and has been used throughout the U.S. and grown virally. Really, when I started on, we started pushing for international expansion. We've localized the product into 19 different languages at this point and now making it available globally. We're seeing triple-digit growth outside the U.S.
For example, last year in Brazil, we saw 350% year-on-year growth as we made the product available in Portuguese and started doing some marketing there. we're really seeing pretty rapid user adoption.
Yep. And then look back in 2009, there are many reports. My research team is so good, but Dave was talking about, Hey, look, we're in the millions of revenue at this point. I mean, can you generally sense, can you give me a general sense of where you're at now in terms of total customers using the platform?
So we don't disclose we don't disclose our financials, obviously, as a private company. But what I can tell you is we're focused on growing both the free user base and the revenue side equally.
Chapter 4: What makes Quizlet's content unique and effective?
You know, we very much believe in building a strong, healthy business that's financially viable and sustainable. And so we're doing really well on that front. We're seeing triple digit year over year revenue growth.
OK, so just be clear, you're doing north of 100 percent year over year growth in terms of revenue. That's correct. Okay, great.
And then funding history. How much have you raised to date? So we've raised $32 million in venture funding to date. We did our first round of funding in the fall of 2015, and that was led by Costa Nova Ventures and Union Square Ventures. We raised $12 million. And then at the beginning of this year, in January of 2018, we raised another $20 million. That was led by Icon Ventures.
And why? I mean, I know once you're on the, you're either kind of stay bootstrapped and do bootstrap, but once you're on the train, you have to kind of keep raising. So maybe why is a bad question, but why raise another 20 million?
Well, so it was really to go after the opportunity, right? The opportunity is so massive and we've amassed this very large user base. this massive content base, which are two key assets. But then third is we have more study data on how real people are studying and learning than anyone else on the planet, right? We do over a billion learning transactions per week.
And so a learning transaction is I ask you a question, Quizlet asks you a question, you give Quizlet an answer, and then Quizlet gives you feedback. So we've got literally billions and billions of data points on how people learn, what the most effective and efficient paths are.
And so where we're really directing our efforts going forward, and the reason we pushed to raise some additional funding to scale the efforts, Obviously, the international expansion that I talked about, but then also really building up our data science and machine learning capabilities to create this AI based tutor.
And so what we're the longer term vision of what we're doing is taking all of that data in this great user platform and building an AI based tutor that will help anyone learn anything.
What's your team size today?
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Chapter 5: How does Quizlet achieve viral growth?
But if you use us twice in a month, that's even better. And if you use us twice a week, that's even better. And we know we know how those goals interrelate. So we understand pretty well how as you become more active, again, depending on which user cohort you're in, what your likelihood to buy is. And we also know, you know, our free users make us money as well off of that.
So we actually have a pretty good understanding of the value of a free user based on their activity.
Yep. Makes good sense. Let's wrap up here with the famous five. Number one, what is your favorite business book?
So I read a lot of business books, but given the field I'm in, I also read a lot of education books, which is my business. And so one of my favorites that I read recently was a book called How We Learn the Surprising Truth About When, Where, and Why It Happens. It's by a New York Times author named Benedict Carey. And I think it's an excellent survey course on how people learn.
I'd highly recommend it.
And number two, Matthew, is there a CEO you're following or studying right now?
There's not really one in particular. My view is I try to stay up to speed on kind of everything that's going on. And I'm very much a believer on take the best and I can learn a lot. I kind of try and take more of the survey course of a lot of different things. Now, I will say a good personal friend of mine is the CEO of a company called SendGrid, which recently went public.
His name is Samir Dallakia. I have a tremendous amount of respect for him. And so he's somebody I follow closely as a friend and seek advice from.
Number three, what's your favorite online tool for building your business?
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