Home > Best Practices > How to Start a Successful Training Company (Part 1)

How to Start a Successful Training Company (Part 1)


This is the first in a three-part series. Part one is an introduction to selling learning content to individuals and organizations. Part two will examine the most important learning management system requirements to support the sale of training. Part three will show how Absorb LMS meets the needs of commercial course providers.

Tim Ferriss’s 4-Hour Work Week made number one on the New York Times and Wall Street Journal non-fiction bestseller lists a few years ago. This book presented a methodology for creating a successful online business that required little effort to maintain. The book described the ability of Mr. Ferriss to earn, at times, tens of thousands of dollars per month from online sales of a nutritional supplement he had invented; all by working four hours per week.

The book’s premise—that it’s possible to earn a great income with little effort—appealed to the unemployed, those working in jobs they hated, and the 80-hour per week, soon-to-be burnout victims who felt trapped in a pattern of living to work rather than working to live.

In recent weeks, I’ve spoken to a number of prospective clients who are looking for a learning management system (LMS) to sell learning content they have produced. Some are looking to acquire their first LMS. Others, wiser from bad experiences, are looking to switch from a system that does not meet their requirements to one that does.

What’s clear from speaking to these learning providers is that if planned and implemented correctly, it’s possible to create a successful online learning company similar to some of the businesses described in Tim Ferriss’s book. You’ll need to work more than four hours per week (I’ll discuss ways to keep the administrative effort low in part two of this series), but the revenues and profits can be impressive.

How Successful?

Here’s an example. One course provider I spoke to last week has 300 unique learners per month paying $299 per course. Each course takes a learner about 15 hours to complete. That translates into annual revenues of $1,076,400. The company sees growth ahead and predicts they’ll soon have 500 learners per month, raising annual revenues to $1.8 million.

To succeed in this type of business, you’ll need the right content and technology. Let’s consider content.

Your odds of succeeding selling courses on easy- to-learn topics with heavy competition are low. Focus on niche topic areas where learners and organizations are highly motivated and willing to pay you fairly for access to your content. Leave the “Introduction to Microsoft Word” courses to the big-name, off-the-shelf course library providers and bloggers of this world.

Compliance and Regulatory Training

Certification training topics in regulated industries are a good place to look for content ideas. Learners will gladly pay to take your course if the resulting certification will advance their careers. Organizations will happily send you their learners for certification training if it reduces the risk of liability from having unqualified employees.

If your learners need to be recertified regularly, you’ll benefit from the financial stability of recurring revenues. Your revenue growth will come from adding new learners. This is a great business model; significantly better than one where you need to continually be chasing new customers to buy a course they only need to take once.

Once you have found a potential topic area, look at who your competitors will be. If there are many companies providing similar courses, and if they seem established or are selling their courses at a lower price point than you envisioned, continue your search. Once you’ve found an appropriate topic area, consider partnering with a subject matter expert for the creation of the content. You want to get good content authored quickly.

You and the subject matter expert will need to spend considerable time becoming experts on the regulations behind the certification training you provide. This will require ongoing effort since regulations change. The good news though, is that changes in regulations will often mean that learners who have already taken your courses will need to update their training to maintain their certification. This will provide an additional source of revenue for your firm.

In part two of this series, I’ll discuss the critical learning management system features you need to succeed selling online learning content.

  1. October 29, 2011 at 10:20 am | #1

    I am impressed and look forward to reading future blogs on your site!

  2. Norman
    October 30, 2011 at 12:09 pm | #2

    Absorb needs a progressive system of charging so that small companies with aspirations to produce an e-learning environment can grow with Absorb. The package is excellent, the costs prohibitive until a customer base has been built which can take months.

    I love the product, I just want to find a way to start to use it.

  3. Richard Nantel
    October 31, 2011 at 12:22 pm | #3

    Norman,

    Thanks for your comment.

    I want to make sure you’re aware of our “a la carte” pricing model. It’s designed for organizations that don’t know how many learners they’ll have. Consequently, it’s the pricing model most commercial training providers select. You pay a flat monthly fee for hosting and then pay a one-time fee of $5 per learner. In short, you don’t need to commit to a specific number of learners.

    We currently have some customers that have as little as 100 learners using our system with this pricing model.

    There are, in addition, creative ways to lower the costs of using our system. Since the technology is very strong in managing different groups of learners and administrators, you could partner with other course providers. Each provider could could have its own learners, courses, and administrators. Rather than handling the technology costs alone, you would be sharing it with other entrepreneurs.

    We know there are less expensive solutions out there but don’t know of any that have all the features of Absorb LMS. (Absorb is priced about 40 per cent less than other full-featured systems.) Nevertheless, we continue to look for ways to make our technology affordable for any size organization.

  4. November 1, 2011 at 12:24 pm | #4

    I like how you’re speaking to the desire to get something for nothing. It never works. If I am going to be an ethical, Servant leader then what real value can I offer. More!

  1. November 3, 2011 at 1:27 pm | #1
  2. November 3, 2011 at 2:13 pm | #2
  3. November 21, 2011 at 8:42 pm | #3

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