1Mby1M Deal Radar 2019: Kodable, Sunnyvale, CA

Kodable provides a complete plug-and-play curriculum that offers children all the tools they need to learn to code.

Kodable was founded in 2012 by Jon Mattingly and Grechen Huebner. While Jon learnt to code when he was 6, Grechen skipped opportunities to learn to code as a kid because she didn’t want to be the only girl in her class. Learning to code at a young age helped Jon to quickly pick up advanced programming skills as an adult while Grechen who taught herself web design in college wished she had taken those programming classes as a kid.

Kodable aims to increase the opportunity for all kids to have a bright future in the digital age by giving them an equal opportunity to learn about computer science at a very young age, starting at age 4. Kodable is designed to touch every part of a child’s life, from their home to the classroom. It offers a complete, scaffolded curriculum that teachers can use with their students without any previous computer science knowledge. They have everything they need, from scripted lesson plans to a full scope and sequence, and even “unplugged” lessons which don’t require a computer.

In addition to the curriculum for teachers, Kodable includes a game for kids to play at home and at school. It has created an entire universe filled with adorable, fuzzy characters to draw kids in and make them eager to explore. Accessible on virtually any modern device, Kodable guides kids through logical puzzles and challenges them with new concepts as they grow. Over time, kids are taken from learning how to think like a programmer in pre-K and kindergarten, to gradually transitioning to reading and writing code.

Kodable has three types of users: elementary school teachers, parents, and kids.

Kodable requires no understanding of written text or a specific language, and to date has been used by kids in over 190 countries. Any type of teacher can use Kodable. However, coding instruction usually falls on the technology teacher. This teacher typically sees every student in the school for 30 minutes to an hour once every week or two.

Teachers were Kodable’s beachhead. There was a lot of interest from teachers, but at the same, they also felt intimidated and anxious about teaching computer science. Kodable always put teachers first, building a product they would feel comfortable using and that their students would love. Teachers loved the Kodable product and told other teachers, and Kodable reached over half of US elementary schools through word-of-mouth alone. It now had direct access to the most trusted educator in a child’s life outside of the parents. Kodable utilizes its extensive reach in schools as a trusted marketing channel to parents, who is the paying subscriber.

Kodable has reached almost 20 million teachers, parents, and kids in the past five years, with almost half of those coming in the past 18 months. It has been used in over half of US elementary schools and over 190 countries.

Kodable has a freemium model for schools, with a basic version of Kodable available for free, and additional content available as per-site license for $1,250 or $2,000, depending on which tier of content they want.

Subscription to its Kodable for Parents product is available to elementary school families for $6.99 per month. Its target market is middle to upper-class members who have the income to pay for a subscription for their children. They’re typically younger parents in 30s and 40s who have grown up understanding the value of technology. Their children are typically in the age range of 6 to 8.

Kodable’s current ARPU after taxes and fees is $62 per year. It has grown its ARR 100% YoY driven by 18% MoM growth of its new Kodable for Parents product, which is set to eclipse its school revenue within the first year. It’s worth noting that this growth was financed completely internally, with almost no marketing spend — simply utilizing its penetration into schools as a free marketing channel into homes.

There are roughly 35 million students enrolled in elementary schools in the United States. Assuming an average family size of two children, it has roughly 17.5 million families enrolled in K-8 and a TAM of roughly $1.065 billion in the US alone. The number of elementary school students in the world is much higher, around 700 million, and Kodable already has some parent subscribers internationally. However, many are below the poverty line and this number is much harder to estimate.

Kodable is currently funded entirely by its own profits. It raised a seed round in 2015 for $1.145 million from Imagine K12 (now part of Y Combinator), Innovation Works, Chmod Ventures, 500 Startups, Eric Ries, and a couple other angel investors. It hasn’t raised any money since 2015 and has been profitable for the past two years.

Kodable doesn’t have any immediate plans to raise additional capital. Jon says their investors have all been amazing, believed in the vision of the company, had a personal connection with kids and education, and have always given them the freedom and support to do whatever is best for the company. If they were ever to raise money again, those characteristics would be must-haves in their ideal investor.

This segment is a part in the series : 1Mby1M Deal Radar 2019