Course Hero, a tutoring business last valued by investors at $3.6 billion, has cut 15% of staff, or 42 people – its first round of layoffs in 17 years, TechCrunch has learned from numerous sources.
The workforce reduction comes after Course Hero itself, a rare edtech unicorn, saw co-founder Andrew Grauer leave his post as chief executive four months ago. He was succeeded by John Peacock, who was formerly the VP of product at the company. The layoff appears to be one of the new CEO’s first significant changes to the business since taking over. Peacock sent an email to staff this week explaining the changes.
“This is the first time in Course Hero’s 17 years that we have done a layoff of this size, and it’s not a decision we made lightly,” the email, obtained by TechCrunch, reads. “It follows careful deliberation with the leadership team about the moment we’re in.” He went on to say that the layoff was done to meet the needs of the “rapidly evolving” sector and that it was “absolutely necessary” for the future of the company.
Launched in 2006, Course Hero was somewhat allergic to venture capital until recent. After launching, the company waited eight years to raise a $15 million Series A. Then, after going another nearly six years without raising venture capital, Course Hero closed two financings in 2020.
Then in 2021, the edtech company announced yet another tranche of capital: a $380 million Series C at a $3.6 billion valuation. It brought a 227.3% increase to Course Hero’s valuation in a little over a year. With fresh capitalization and a broader vision of its total addressable market, the company began scooping up businesses, including Scribbr and LitCharts, a Sparknotes spin off. It’s unclear how the acquisition cadence will change given today’s scale back, if at all.
Grauer once expressed concerns on the risks and reward of rapid capitalization to TechCrunch. Since leaving the company, he became CEO of Course Hero’s parent company, Learneo.
As of 2021, the business says it has been cash flow positive and profitable on an adjusted EBITDA basis for over five years. TechCrunch reached out to Course Hero for further information around the layoffs and health of the business and will update the piece upon comment.
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Course Hero, edtech unicorn last valued at $3.6 billion, conducts layoffs by Natasha Mascarenhas originally published on TechCrunch
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Photo and Author: Natasha Mascarenhas