Degreed is a leading online education company that offers high-quality courses and mentoring to help professionals advance their careers. It allows users to take classes tailored to their interests and receive feedback from experts. Degreed also focuses on providing job opportunities to those who complete its courses. Its business strategy is unique and was developed out of the founder’s desire to help others improve their careers.
But how does Degraded makes money? What’re its revenue sources? This article will tell you everything you need to know about Degreed’s income stream.
Degreed operates on a SaaS (Software as a Service) model. Its software allows companies to license their upskilling and re-skill programs for their employees. Degreed charges them on a per-employee basis.
Upskilling doesn’t actually create the instructions; rather, it works both as an LPX and as an LMS (learning management system).
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About Degreed
Degreed was started in 2012 as an online education platform that helps people learn new skills.
What sets Degreed apart from other upskilling programs is that the participants’ data stays with them throughout their careers. Therefore, if an individual leaves one organization for another, he or she may export his or her data so that it can be used at the new employer.
Moreover, the skills rankings are standardized from company to company.
Business Model of Degreed
Degreed operates on a SaaS (or “cloud”) model where they charge companies fees based on the number of people who use their service.
The SaaS function as both an upskilling and re-skillings platform that functions as both an LXP and an LMS.
There are lots of SaaS/LXPs/LMs out there. Some of them are better than others.
- EdCast
- Udemy
- Voxy
- Coursera
- Codewars
Degreed’S differentiators include its ability for employers to retain their own user base, which gives them an advantage when it comes to sharing knowledge among themselves.
Degreed helped established Learning XP as a category by disrupting the LMS market.
How Does Degreed Make Money
Degreed makes money from only one source of income – it’s a software company that charges employers for each user they add to their payroll system.
It’s really that easy!
What sets these companies apart from others is their variety of features:
Skill Analytics
According to Degreed’s research, the best and most adaptive workers are 64 percent more likely to seek out opportunities for career advancement than others who aren’t so adaptable.
That is why the Skill Analytics feature enables organizations to have a skill measurement system that gives them a real-time view of the progress of their employees’ skills.
With one feature of Skill Analytics, you can rate skills from beginner levels to advanced ones.
Degreed claims to be able to predict future success better than any course, badge, or record of time spent learning.
They use an assessment model that consists of the following steps:
- Choose three pieces of evidence for each claim.
- List Endorsers
- Review Application
Another aspect of the Skill Analytics feature is the portable skill profile.
This allows employees to have a digital copy of their skill rankings within the Degreed platform throughout their entire careers. It ensures that no matter where they end up working, their skills profiles remain available to employers.
So, if you want to check out your strengths and weaknesses, you can use this tool to get an objective view of yourself. And people who switch job roles won’t face any consequences for doing so.
If there is any correlation between the skills learned in one job and the skills needed in another job within the same company, then the portable skills profile will be a quantifiable benefit for this person and for any potential employers who may consider hiring them.
Learning Experience Platform (LXP)
According to Degreed, the best and most adaptable workers are 142 percent more likely to look for personalized guidance and recommendations from their companies’ learning systems.
Because Degreed has partnered with LearnUpon, Degraded is both a Learning XP and an LMS (learning management system).
An LPA (Luxury Performance Automobile) is a car that has been handcrafted by a skilled
An LPX is an integrated platform for an entire ecosystem of instructional materials into one application.
- Courses
- Videos
- Books
- Articles
- Projects
- Mentors
- Managers
Learning through observation requires students to engage their eyes, hear, and touch. It involves them physically interacting with the material.
According to a study by Harvard Business Publishing Corporate Learning, traditional learning techniques don’t produce a high return on investment.
Therefore, multiple media platforms are required. Of course, top leaders could track all of these media sources for all of these employees themselves, but there may be better uses for the resources of a business’ leadership.
Automate the entire process by integrating all training tools into one app.
You could even record the progression of each individual employee in each skill so they know exactly where they stand.
Within the LPX, there is an “insight” element that enables companies to not only track where their employees are progressing in different skills but will also help guide the employees towards the right path.
Therefore, if an individual is weak in a certain area, the company can suggest training them in that area. If the company has insight into a skill that they believe the individual would excel at, they can recommend up-training in that area.
One feature of the LPX is its ability to provide an individualized feed for each user. This allows managers to see which specific skill sets their team members to need training on.
Instead of an outdated system where bosses state, “You need to learn this so we don’t fire you,” employees and managers develop their own knowledge together.
If the CEO posts an interesting new piece of content, everyone else can read it and comment on it and learn from it together.
Career Mobility
Degreed asserts that 87 percent of the best and most adaptable workers are more likely to have access to projects and opportunities to enhance their skill sets at their workplace. Degreed functions as an “intelligent” Learning Management System.
Businesses need to adapt to changing conditions, so they must continually update their skill sets.
An enterprise must first discover its own skill gaps before hiring new people to fill these gaps.
Furthermore, that will be easier if it can quickly identify which employees are best suited to learn which skill using which training method.
It would certainly be easier if a computer program could automatically recommend people who need to be fired.
Yet better than that, what if the software was able to identify the right employees for the job and then suggest the appropriate courses through the LMS?
If supervisors had access to an algorithm that could help them identify which employees were likely to be able to perform new skills, then they could spend less time managing their workers’ skill development.
- Identifying the right people for the right skill development programs
- Seeking out such employees for such skills training
- Evaluating progress in training
The Workforce Management feature allows organizations to designate tasks, project assignments, and even job roles.
As a result, Career Mobility can be used to supervise artificial intelligence systems.
Extended Enterprise
Degreed’s Extended Enterprise feature lets organizations extend their reach beyond their own internal teams.
Through extended enterprise, companies can extend their reach into new markets by building synergies between different parts of their business.
- Contractors
- Partners
- Suppliers
- Customers
Additionally, the integration between Degreed and Salesforce allows for centralized control of the entire sales cycle.
- Multiple organizations
- Multiple user bases
- Multiple technology configurations
- Multiple content catalogs
Degreed Acquisitions, Funding, and Valuation
Degreed doesn’t need external funding because its funding has grown more than “20 times” since it was founded.
Its value has increased by two times in just one year.
Degreed has acquired at least three companies:
- A European educational tech startup called Gibbon launched its first product in March 2016.
- Online learning company, Pathgather, launched in June 2018
- The London-based talent management company, Adepto, has announced its acquisition by a global recruitment firm.
Is Degreed Profitable?
Degreed has grown rapidly but is not yet profitable. It is currently investing heavily in marketing, customer support, and sales as it builds its brand and increases its user base.
At one point, Degreed CEO Chris McCarthy boasted that the company was doubling its revenues every year.
Regardless, he also claims that Degreed wasn’t profitable when it launched. He explains that this was due to the fact that the startup had just started growing.
It may be true that the company has left its “growth” stage and entered into the “profitability” stage. However, no public announcements have yet been made to confirm this fact.
Conclusion: How Does Degreed Make Money?
And so, here we go again — this article has given you an overview of how Degreed works for its users and how it makes money.
Degreed is an online marketplace where people can connect and learn from experts in different industries, e.g., business, tech, etc.
Degreed is an excellent online platform where students can learn from experts at any level and stage of their career.
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