OpenLearning chief executive Adam Brimo says the business will focus on growing in Australia and Malaysia. Supplied
Education technology start-up OpenLearning has raised $8.5 million from Malaysian investors as it aims to keep building its platform for hosting massive open online courses (MOOCS) by winning more university clients.
Led by two publicly listed Malaysian companies, Prestariang Berhad, the south-east Asian country's leading technology and talent platform innovator, and Paramount Corporation Berhad, an education and property company, the raise values the Aussie business at $33.5 million.
Co-founder and chief executive Adam Brimo told The Australian Financial Review Malaysia had become an increasingly important market for the company.
"This speaks to the importance and value south-east Asian and Australian investors place on education," he said.
"All our early investors are from Australia, but Malaysia is a very important market for us and we wanted to look for strategic, value-adding investors."
The round brings the company's total funding to $13.7 million since it launched five years ago.
The business provides higher education institutions with a platform for running MOOCS, consulting services to develop online courses and a global marketplace to attract new students, which also includes marketing services.
The business now counts seven out of 43 universities in Australia as customers and 30 out of 500 universities and colleges in Malaysia.
Short course demand
Mr Brimo said the business was seeing increasing demand from universities to establish more short courses, which cater to skills of the future workforce and which early and mid-stage professionals are increasingly seeking.
"A lot of the skills these professionals are looking for are quite new and courses don't meet these needs yet, so universities are developing short courses that are four to 12 weeks long. Taking a few months to learn a new skill is also a more exciting opportunity for a working professional than going to university for three or more years to do another degree,' he said.
"For a long time universities were content with just offering degrees, but I don't think that's sustainable and a lot of growth will come from people wanting to do these short courses."
OpenLearning's Australian investors include tech entrepreneur Clive Mayhew, who is also the company's chairman, ICS Global and Telstra's muru-D.
The latest funding round will allow OpenLearning to build up its presence in Australia and Malaysia, before potentially expanding to other south-east Asian markets.
'Good indicator of growth'
"Over the last four years we've had on average 100 per cent year-on-year growth in student numbers," Mr Brimo said. "That rate increased in the past quarter, when we added well over 250,000 to 300,000 students.
"Enrolments alone aren't our main driver, but they're a good indicator of growth and interest in the courses."
OpenLearning's platform and consulting services are its largest drivers of revenue, with its marketplace making up about only 10 per cent, but Mr Brimo believes the percentage of revenue from this segment will grow as universities turn to it to help market the courses.
The business now employs 70 staff, split between Sydney and Malaysia, and in the next 12 months it intends to grow its headcount by at least 30 per cent.
Paramount chief executive Jeffrey Chew Sun Teong said there had been a strong push from the Malaysian government to modernise its education system using technology and it was committed to playing a part in that.
"As we enter the Fourth Industrial Revolution or Industry 4.0, companies – big or small – will have to innovate and stay relevant in order to stay competitive in the global world," he said. "As such it is critical for us to embrace change.
"We have been looking for opportunities to gain entry into technology-based businesses and this investment with OpenLearning is a step in the right direction."