Thought Leaders in Online Education: Interview with Shaul Kuper, CEO of Destiny Solutions (Part 4)

Sramana Mitra: Ten or 12 years later, where do you stand? What percentage of your business is product versus customization services?

Shaul Kuper: In the early days it was not uncommon for a school to pay a few million dollars for customizations, and it would take a year or two to implement. Now we are down to literally weeks of implementation and in the $20,000 to $30,000 range. That is an implementation cost. Many schools don’t need any customizations whatsoever right now.

SM: What is the price of the product?

SK: We started off with a perpetual on-premise business model. We have since switched it to a cloud based SaaS offering that is based on subscription. Our typical model is a percentage of revenue – similar to how a credit card company charges a percentage to do the transaction. We charge a percentage of the transaction to run the entire system for the university.

SM: What does that amount to typically?

SK: Some are between one and two percent. Some schools range between $3 million and $35 million in tuition revenue.

SM: So this is revenue from discrete courses, from full degree programs, etc.

SK: Typically speaking, yes. Schools we deal with typically don’t charge for degree programs but for degree courses. But whatever they run through our system is what we get a percentage of.

SM: Where are you revenue-wise today?

SK: We are just under $10 million today.

SM: Have you completely self-financed the company?

SK: In 2001, when we got the deal from the University of Toronto, I realized that we weren’t going to be able to afford building everything. Payment terms were staggered in terms of deliveries. At that time I raised money from angel investors.

SM: How much?

SK: We raised $1.4 million at that time.

SM: Did you raise any more money after that?

SK: No. We have been self-financed ever since.

SM: So the angel investors are your only investors?

SK: That is correct.

This segment is part 4 in the series : Thought Leaders in Online Education: Interview with Shaul Kuper, CEO of Destiny Solutions
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