How Does Udemy Work? | Udemy Business Model Explained

In today’s advancing world, having an extra set of skills makes up an interesting resume.

But, in most cases, this isn’t achieved because of stubborn time tables.

Well, for around 30 million students around the world, Udemy has solved this problem.

Udemy has proven to be a crucial asset for those who want to learn a new skill by allowing them to learn at their own time and pace.

What Is Udemy?

Literally rooting back to “You” + “Academy”, Udemy functions on the simple yet complex task of helping anyone learn anything.

Founded by Eren Bali in 2010, Udemy is an online platform facilitating the process of learning and teaching online. It uses content from online content creators to earn profit and aims at professional adults who wish to add some more skills to their resumes.

It currently provides access to 100,000 online courses and has educated more than 30 million students from 192+ countries till date.

udemy courses

Udemy Business Model

Udemy operates on a marketplace business model. It basically organizes the products and services of different sellers (or instructors) and sells them on its own website.

The firm only acts as a mediator and doesn’t own the products or services provided. Hence, the prices are determined by the instructors themselves, while the company only charges a commission for providing sellers with a platform and a huge audience to sell the services.

As an instance, we can consider any online shopping site such as eBay or Amazon, which act as a bridge between the buyers and sellers.

The company generates annual revenue of approximately $28 million by promoting and selling courses from multiple instructors around the world.

How Does Udemy Work?

Udemy works on 4 major lines and aims to provide the following to its students:

  1. Convenience

Udemy provides its students with the freedom to choose what and when to study. If a particular course is made available on Udemy, students can enrol for it whenever they want. Moreover, there’s no set time limit, so the students get to learn at their own suitable pace.

UDEMY learn at own pace

  1. Variety

Udemy has linked tutors from all around the world who teach a huge variety of subjects from business to the arts. It allows the students to learn whatever they want.


  1. Affordability

Udemy courses start from as little as $9. There are also a variety of discount coupons and seasonal offers which help students to register themselves in courses at dirt rates (90% of sales occur with a coupon code). They also have an option to choose their preferred method of payment.

udemy affordability

  1. Certification

Udemy provides the students with a certificate of achievement, a mark of completion of a particular course. Certificates can be saved as a .pdf or .jpg file so that you can easily share your accomplishment. In addition, certificates can be shared on Facebook, Twitter, and LinkedIn directly from Udemy. The certificate of completion looks like this-

udemy certificate

How Does Udemy Make Money?

Udemy offers both paid and free courses to the students. It sells content on-demand and the tuition charges depend totally on the instructor. It is also a destination for corporate sector companies for employee training.

The cost structure is as follows:

  1.   Instructors earn 97% of all tuition revenues if the instructor’s own reputation or marketing attracts the student.
  2.   Udemy retains 50% of the earnings if the student is attracted by the sites own marketing.
  3.   The instructor earns just 25% of the tuition if a Udemy promotional affiliate attracts the student (the affiliate earns 50%; the remaining 50% is split between Udemy and the instructor).

Future Of Udemy

Udemy is an interesting and evolving concept that focuses on the transfer of knowledge, rather than fetching a diploma. The wide variety of content and instructors available at affordable rates and the exceptionally personal pace of learning make Udemy a very convenient method of attaining skills. With the world becoming more advanced and technophile, businesses such as Udemy have huge horizons unlocked for themselves.

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