One year following the failure of an ecommerce platform they had launched due to the lack of market readiness, Saudi entrepreneurs Mohammed Aldhalaan and Abdulaziz Alsaeed founded an educational platform that managed to attract more than one million high school Saudi students.
The two founders launched Noon late 2013, after noticing an opportunity in private tutoring, with “an immature fragmented market estimated at $8 billion in the Arab world,” said Aldhalaan.
The platform is currently focused on helping Saudi students to pass the general aptitude test (also known as the scholastic aptitude test (SAT)) and the achievement test. These two tests are necessary for students’ admission to college and determine the major they can enroll in depending on their scores.
Noon seeks to substitute consulting with neighbors to ask for tutor recommendations, with a platform where students can study for these tests on their own, get access to private tutors when needed, and evaluate their learning experience.
The user can register on Noon for free to benefit from the educational content and choose the lesson and course he wants to take. After that, it provides flash cards that explain the course with related images, along with exercises and questions the students takes before receiving their scores in a graph that shows their weaknesses and strengths.
If the user doesn’t understand the lesson, he can ask for a private tutor through the platform via a button called Fazaa.
Tutors are not chosen randomly, and they have to go through a selection process to make sure they are eligible to join Noon. Once the tutor passes the tests that measure his intuitiveness and problem solving skills, Noon provides him with models of the lessons it offers to practice. After that, the tutor sends Noon a video sample of him explaining the classes. Afterwards, he will have to go through one final interview where Noon’s HR team decides if his is eligible for the job, explained Aldhalaan.
Freemium business model
Noon’s platform caters to Saudi Arabia and it has almost one million high school students in the Kingdom. This would not have happened if it hadn’t changed its business model.
When first launched, Noon was a subscription-based platform. However, only few registered because of the “mandatory registration, high prices and the unwillingness of Saudis to pay for education online,” said Aldhalaan.
This shocked the cofounders who decided to switch the business model to a freemium one, providing registration and most self-learning services for free. The user only pays for the private lessons he chooses, and this is how the platform generates revenues. The user can request the services of one of the 100 private tutors registered on Noon.
Most registered teachers are from Egypt, which allows Noon to provide cheaper services than regular Saudi tutors who usually charge between 180 and 250 Saudi riyals (US$ 48-66) per hour. The platform charges less than one Saudi riyals (US$ 0.27) per minute, or around 50 riyals per hour (US$ 13). Though they did not disclose the amounts paid to the teacher, outsourcing tutoring from Egypt, which costs less, was of great support. Even though the founders did not disclose the number of paying students their platform has, they confirmed they they are breaking even. Thus, the company managed to break even.
The freemium model allowed Noon to attract 100,000 students in Fall 2014, “which motivated us to maintain and promote the platform, and reach the critical mass of users necessary for our model,” said Alsaeed.
After realizing that most students are more active around test times, the team introduced new features to study mathematics, physics and English, keeping the students engaged throughout the year to secure a sustainable income for Noon year round.
Tutors can communicate with the students on the platform, through instant messaging or voice calls. In addition to that, they can use the phone or tablet screen to create graphs helping the student understand the lesson.
Noon has 25 people on its team between Saudi Arabia, Egypt and India who handle management, supply chain and tech. In addition to 50 part time employees handling the content.|
Competition does not stop integration
Education platforms are not new to the region, and there is a true surge in the number of education platforms. However, it seems that each of them is specialized in a certain service to seize the market opportunities. Tomooh, for instance, targets Saudi students seeking to enhance their performance in the SAT and the achievement test, whereas Drresni is known for private tutoring.
What sets noon apart, according to Aldhalaan, is that it offers tutoring and free educational content through its freemium model which allows it to attract a big number of users. Unlike many of its competitors, it is accredited from the National Centre for Assessment, which is directly in charge of organizing assessment exams.
Aldhalaan believes that there is room for collaboration with competitors. “We are seeking to cooperate with our Egyptian counterpart, Nafham, so that Noon tutors can offer their services along with the advanced educational videos the Nafham platform brings.”
Do not allow challenges get in your way
The biggest challenge Noon and most Saudi startups face is people’s hesitance to pay online, and banks not allowing recurring billing, explained Aldhalaan.
Instead of online recurring payments, Noon accepts money transfers. However, this limits the number of paying users, said Aldhalaan, especially for services requiring recurring payments on a monthly basis.“Frequent payments through credit cards make the payment process easier and encourage users to buy digital products,” he added.
Noon received funding from eight well-known angel investors, including Mudassir Sheikha, the cofounder of Careem.
In the next stage, the Saudi company will offer additional features such as an interactive platform, where students, teachers, and parents can communicate. “This platform will allow students to do their homework and teachers to correct them directly,” according to Alsaeed.
Additionally, it is planning to expand to Egypt by 2018, starting with adding the Egyptian curriculum to their platform.