Pierre Dubuc is a French businessman born in Normandy, France. He has had a passion for educating the masses since middle school. His first project was simply to build a free online course for all subjects in France free for all to access. The team continued to keep the project alive from 1999 to 2013 when they got the drive to commercialize it into an educational company. The company, Openclassrooms has gone through blitz-scaling over the past few years to form a massive global educator. It has raised funding from top-tier investors like Lumos Capital Group, General Atlantic, Chan Zuckerberg Initiative, and Salesforce Ventures.
In this episode you will learn:
- How to transition a childhood project into a viable business
- Dealing with fast business growth, scaling, rescaling, and blitz scaling
- How to handle large unsolicited investments
- How to handle quick growth
- His future vision of the company
For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
The Ultimate Guide To Pitch Decks
Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400 million (see it here).
Remember to unlock for free the pitch deck template that is being used by founders around the world to raise millions below.
About Pierre Dubuc:
Pierre Dubuc is CEO and co-founder of OpenClassrooms, Europe’s leading online education platform with 3 million members and 50 partners. He graduated in telecommunications from INSA Lyon and in 2016 was named one of the “30 under 30 Europe” by Forbes.
Pierre created the company together with Mathieu Nebra, Pierre in 1999, at age 11. It is the first online campus in Europe and among the largest EdTechs in the world.
See How I Can Help You With Your Fundraising Efforts
See How I Can Help You With Your Fundraising Efforts
Connect with Pierre Dubuc:
Read the Full Transcription of the Interview:
Alejandro: Hello everyone, and welcome to the DealMakers show. Today we’re going to have the battle of accents here. We’ve got the Spaniard, we’ve got the French, and obviously, both here in the U.S. as well. What a country! We’re going to be learning a lot about scaling, and more importantly, blitz scaling. A lot about Series Bs that are on plan raising more than what one would have expected, and then also, some of the things that come with it. But without further ado, I’d like to welcome our guest today. Pierre Dubuc, welcome to the show.
Pierre Dubuc: Thank you, Alejandro. I’m glad to be here.
Alejandro: So originally born in Normandy, but you moved a little bit, so how was life growing up?
Pierre Dubuc: It was great. Yeah, I was born in France. I lived in a small village, and then we moved around. I spent a lot of my life in France in a very nice area and studying in France and also in Australia, in Sydney, and then ended up in Paris. And more recently, I moved to New York in the States.
Alejandro: Let’s talk about you being in school because when you were in your high school days, you started to see some of the inefficiencies that were happening there, and you started to think about, “Maybe there’s a way to get those courses online.” What happened here?
Pierre Dubuc: Yeah, that’s right. A friend of mine that I met here, my co-founder, decided to create online courses throughout France, every subject online for free. It was the best way to show those courses. I decided to help him build the platform. It was in 1999, and we were actually in middle school at first. We studied for many years. We built the courses we wished we had, and those first courses were mostly on web development, computer science, programming like IT-related stuff. We did so for many years, and we began the reference platform in French.
Alejandro: Actually, for you, it has been, as they say, ideas take time to incubate. They’re always, as well, dormant. For you, this was what eventually became the seed that you planted for the company to come to fruition. But in this case, before you actually launched the company, you put yourself through studying computer science and engineering and more on the telecommunication side. That shaped more the way you could have gone about the execution. Tell us about what happened there because instead of tackling it right away, you went at it with the university, and then you picked it back up where you had left it, so tell us about this.
Pierre Dubuc: We started in ’99, and it took us until 2013 to build this as a venture-backed company. It’s been a personal project and a small mom-and-pop shop for many years. At first, it was not a business. For many, many years, it was where we were just helping friends and helping people, and it was a side project for us, a personal project. It took us a while until we realized it could be a full-time job, and it could become a company. When we were in college, some of our buddies used their own websites and stayed off their classes. This was probably when we started realizing, “Actually, this might be a sign.” At some point, one of our teachers in college told us—he kind of knew about what we were doing, and he had a pretty good idea of the significant size of the impact of it. He said something like, “Honestly, you guys would chill it if you were to become a college for yourselves because I’m seeing students who learn everything, thanks to you, and not thanks to old-school, so make it a school.” At first, we thought he was ridiculous, and what he said was nonsense. We pictured a school, a college, as something like a big building, a campus, and classrooms, and desks, and chairs, and whiteboard, and all of that. To us, it was not where we wanted to go. So we rejected that and pushed it back for a while. At some point, we realized, “We could be a college.” This was when things got started, and in 2013, we built OpenClassrooms as a mission-run company. The mission made education accessible. We became the very first online college in France, and we got full degree-awarding powers. It was something completely new and unexpected by many folks in the market, and from there, we went from one milestone to the other.
Alejandro: What ended up becoming the business model of OpenClassrooms?
Pierre Dubuc: At this age, we made a big pivot in 2013 when we moved to OpenClassrooms. But before, we used to operate almost like a not-for-profit. It was a big committee. We had plenty of people helping. We already built the company, but it was a business model based on advertising, so it was really different. At some point, we said, “You know what? We’re going to [7:34] the business model; we’re going to [7:37] the brand.” We moved from a former brand that was [7:41] and ran from scratch in France. We wanted to switch to OpenClassrooms that are more global and more education-related. Then we wanted to get degree awarding powers. All of that was very new. It was a big development and it was very painful because we had to say no to a part of what we were before. Obviously, some people liked it; some people didn’t like it. It was a painful period for us to go through. Eventually, when we did and made it clear our ambition and our mission was, very quickly, it was easier, actually, because it was clearer. You were maybe aligned or misaligned to that, but we knew where we were, so it was a very interesting phase, and we [8:44] advertising business model, so the revenue went [whirr sound]. We had publishing books as well. We were a publishing house. It went [whirr sound] and sold the business. Then we started from scratch almost again to build an education business model, which was about selling education, so charting for training programs, for degree programs, and the subscription model.
Alejandro: How does OpenClassrooms work today?
Pierre Dubuc: The way OpenClassrooms operates is that we offer around 60 degree programs, programs leading to Associate’s, Bachelor’s, and Master’s degrees and leading to jobs. The outcome for a modern degree is to get a job, so we train you on jobs, opportunities, and jobs in high demand. We actually grant you a job, so if you don’t find a job within six months, we will refund your tuition fees, and those jobs are mostly in tech, digital industry, or business-related positions. So that can be code, data, AI, cyber, product management, design, and business-related jobs would be SaaS, management, leadership, finance, HR, etc. The way we train is something very flexible, very unique, very modern, fully aligned, competency-based. So to get the degree, you need to validate the set of skills for your degree and for your job. You have to demonstrate your skills through projects. So you have a dozen official projects to complete. Those projects are real-life case studies, so if you want to become a data scientist, imagine you are in this company. Here’s a data set. You have to [10:48 – 10:53] and then make a pitch to your manager or your clients, and you’re going to demonstrate your skills this way. You have access to online courses and books to gain competency and the cornerstone of [11:04 – 11:07], so you have a dedicated industry practitioners on data science, for example, tutoring you, coaching you every week on a one-on-one basis. A program like this would typically last for four months, and you would meet with your mentor every week, so 50 times. It’s really high-touch and involved, and we have to find a job, so we also offer one-on-one career coaching. We match you with 1500 employers because the end goal is for you to get a job. That’s our product. We started selling B2C, but most of the revenue now comes from B2B, so we make three-quarters of the business in B2B, and that’s for upscaling employees, rescaling employees, and running internship programs.
Alejandro: And also to governments. You guys even sell to governments.
Pierre Dubuc: That’s right. We also started selling to governments three years ago, and then that got curated like crazy with COVID and stimulus packages. Obviously, the number of job seekers exploded with COVID, so we do sell to governments what we call risk-scaling programs or [12:27] programs. This is on five target populations that were job seekers, refugees, school dropouts, people living in underprivileged areas, and those with disabilities.
Alejandro: In your case, when you started the business, it was about 2012, like really seriously. At that time, the startup ecosystem was not that developed in Europe. I remember in Spain, at that point, it was either you became a lawyer, a banker, or a consultant. I’m sure that in Paris, where you were, it was most likely the same. So how was the ecosystem back then, and how hard was it for you guys to get going and start to raise money?
Pierre Dubuc: You’re right. It was definitely less mature than it is today. When we started in college, schools didn’t have any entrepreneurship tracks or any support whatsoever on entrepreneurship. Now they do. We really had to find everything on our own. Today, if you don’t know how to hire somebody, this is not something you learn in college how to hire my first employee, for example. I have no idea. There were not so many resources online. It was hard to get access to best practices and [14:02]. You could buy a few books, and you’d need to read like 500 pages, and it could be pretty long. Now, it’s much easier. First, you can be taught this in an incubator accelerator, even in college, but you’ll also find many courses, including plenty of courses online to teach you. Also, the access to capital chance, for more capital in the market, in Europe, and especially in education. Back then, the education market was non-existent for the tech market. That changed a lot. We had to push pretty hard to get to where we wanted to. I would say, journey speaking, I feel it’s a bit easier now because the market is more thorough than it was when we started many years ago.
Alejandro: Obviously, you guys have been able to ride that wave, which is amazing. How much capital have you guys raised to date?
Pierre Dubuc: $150 million.
Alejandro: And the Series B round was pretty interesting. It was completely unplanned, so how did the Series B come together?
Pierre Dubuc: It’s an interesting story. Right now, we’re at Series C; we just raised it a couple of months ago. We raised another $18 million. The Series B was $60 million back in 2018, so three years ago. At this stage, we were between 50 and 60 employees. We were probably making about 10 to 50 euros of revenue. So, as decent size, but not huge. We were growing pretty fast. It was going well, but we had no plans to raise right now, and funds based in New York reached out. Their name is General Atlantic. They reached out and said, “We spotted you guys in education. We’re super interested in education. Can we talk?” We’re like, “Yeah. Why not?” We had the first chat with the analyst based in New York. He said, “We actually have a team in London. They’ll be in Paris on Friday. Are you available? Can you meet them?” We’re like, “Yeah. Why not?” So we met them at a mutual office. We went along, and then the next week, they were like, “Actually, we understand you don’t want to raise right now, but you guys will raise eventually, let’s say at the end of the year or something like that.” “Yeah, probably.” After this conversation, “What if we would put this round right now on the table as you want it in 12 months, but we put it right now, and it’s easy; it’s quick, and you can get back to business.” Of course, it’s tempting, but when you’re inexperienced, you’re like, “Eh.” It’s tempting, but it doesn’t work that way. So we pressed a bit hard, but eventually, we went into due diligence, and they did a term sheet that was pretty exciting for the stage of our company, and we raised [17:45], and that went quickly. It was a bit unexpected, and it happened quickly at a sizable amount of the stage of the company. Then, obviously [18:05], and we’re super excited by this. But then after, we didn’t really have the [18:16] and the resources to just swallow $60 million of capital. $60 million is a lot of money.
Alejandro: That’s a lot of zeros.
Pierre Dubuc: Yeah, a lot of zeros. At this stage, it was $1 million of capital for every employee of the company. You can do a lot with $1 million. So it was a lot of money, and we started to operate at a much faster pace, but we were already operating at a fast pace, and it was really hard. Everything was hard because everything started to break. We had no entrance to the future, no tools, no processes. We had to hire many new top managers [19:12]. It took me probably about 18 months to get it stabilized and 24 months to have a proper team. And this period of time was really, really tough because we worked like crazy, like dogs, day and night, and it just was not sufficient. It would never have been sufficient. We also started missing our target, and so it was a lot of pressure. None of this was for investment, but it was just by yourself. It was like, “We need to do this; we need to do that.” We were falling behind. It was really, really hard. We were not set.
Alejandro: Obviously. You guys were making a killing, but with what you’re saying, you guys were already operating at a fast pace, and then all of a sudden, you have all of this money, and you’ve got to use it, and you’ve got to deploy. You were mentioning some of the things that you were able to do to stabilize everything was getting more senior people in. What were some of the typical issues that you were encountering?
Pierre Dubuc: A typical issue would be you have three engineers. It works really well. They’re super [20:35]. You add five, six, seven, eight, and then the output of this team is actually lower than when you only had three engineers. It’s very common, actually. It’s a bit counterintuitive, but it’s not because you add more resources that you’ll get more output. At some point, it’s actually even going sideways. It was, honestly, the same across the board, like engineering and product impact was the same in sales. One salesperson would sell and make a killing, but then we add four and the disaster, and you can sell anything. Maybe you’re a brilliant salesperson who will become the manager, so they don’t sell anymore, and then you hire new sales reps, and they’re not trained, and maybe they’re not the right ones. So we have a huge amount of activity across the board, so that’s a huge issue. Then we started to hire like crazy, sometimes in the non-structured way, so we made some mistakes. Sometimes people were not at the right level. Sometimes they didn’t have the right behaviors and the right mindset. Obviously, we fixed this when we understood it was the case, but still, one day, it’s one day too many when you are operating. Many programs offer activity, making mistakes, being slightly inefficient on many different fronts.
Alejandro: Then you were alluding to this. You guys just raised the Series C, and that was $80 million, and the last 12 months have been in blitz scaling. Blitz scaling is what Reid Hoffman coined as a term. So tell us, what has been blitz scaling for you guys? How did that look?
Pierre Dubuc: For us, when COVID hit, it created strong tailwinds on our market, online. Then the market started to accelerate. After just a few weeks, we understood that would challenge the dynamics. When COVID hit, we were about 150 in the company. Now, we’re more than 400. We hired 250 people this year, and we still have 152 hired. So we’ve been more than doubling year-over-year in terms of sales, revenue, people, everything. It’s been very hectic. When you double—it’s more than doubling, but let’s just for the sake of example, if you double, it means that half of your team arrived less than six months ago. So they’re newbies. They know nothing about anything. Now, it’s the majority of your team that know nothing because they just arrived, and you train them, but they were not there. They didn’t see what you did last week or last month, or last quarter—a lot of things with communications, very strong recruitment processes, very strong embodying and training processes, personal management, and people management. Then, also, carry the plans and carry the development opportunities for them because they want to grow. They want to become managers. They want to be senior leaders, etc. Right now, we hired about 40-50 people a month. It’s a lot of interviews. It takes a lot of energy from managers. The more you hire, the more mistakes you make. It’s been very interesting, but at this stage, everything might be a small waste of your time. For example, when we started, we said, “We need to hire 100 people next month.” One thing that was a roadblock was getting your hands on laptops. To have 100 laptops, we used Macs. You need to order Apple, and Apple maybe has a one-month delivery for 100 laptops, and especially during COVID, there was a shortage of laptops. We didn’t want to wait for one month, and we had hired many people, and they didn’t have laptops. It’s ridiculous. Then we hired people in the UK, and there’s Brexit, and we want to send them some stuff, and now you have to go through customs. You lose another week. Very small logistical stuff will make your life miserable, and we go from a 100-person gross rate to an 80-person gross rate. It’s very hard to maintain this type of gross rate, like 100+ because every single problem has to be fixed very quickly.
Alejandro: That’s incredible. Imagine, Pierre, that you go to sleep tonight, and you wake up in a world where the vision of OpenClassrooms is fully realized. What does that world look like?
Pierre Dubuc: We’ve set this ambition. Obviously, first, the mission is to make education accessible, which is a never-ending goal. But we have to find a more quantified ambition, which is to place 1 million students a year in the workforce. So we want to reach, which you have a college and it involves one million students a year. They all graduate, and they all find a job every year. So that’s the ambition that we have, which is connected, as you understood to jobs and skills and employers.
Alejandro: That’s amazing. Where do you think the world of education is going as a whole? Because the way that universities operate and the world and the past that we’re coming from, the future is going to be completely different. I think that in 15 or 20 years, it’s going to be completely unrecognizable the way that people are getting educated. So, where do you think the whole educational space is going as a whole?
Pierre Dubuc: It has changed so much already since COVID. It’s a huge leap from where we were, and we’ll probably gain at least five years of the acceleration of the sector. First, there’s this huge acceleration forcing education and training and learning to go from in-person to online thanks to COVID, to be honest. It was quite a leap. And then we’re still moving up the ladder. Then the second impact is the acceleration of the transformation of businesses and that impact that scales in jobs because obviously, retail, for example, is more online because of COVID than ever before, less in-person and more eCommerce. More eCommerce means the jobs are fully different—less shops, more logistical centers, and fulfillment centers. It’s more digital jobs, and it’s a lot of services, etc. So jobs scale back even more dramatically, so you need more scaling and more rescaling. Right now, there’s a huge financial page on many different markets. That means there’s a huge need for corporate learning, corporate training, apprenticeship, rescaling, and upscaling. So you have a combination of more education online, and more education is needed. So the market is growing like crazy. At the same time, traditional incumbents are struggling. If they were not fit to go online, it’s a nightmare. Students are tired of being in lectures online on Zoom for hours and hours. There’s a shift that is happening very quickly from more traditional to more modern online. All of that accelerated the market. I would say that the largest opportunity is actually in the vocational training, so it’s job seekers willing to switch careers to upscale to gain a few competencies to get a motive and mobility. When we think of education, we always picture a college, the school, the university. But that’s only a fraction of the learning journey of a given person. It’s only from 18 to 24 or so. What about from 20ish to 60+. That’s a huge portion of your life that is not very well addressed, and actually, the market is growing quickly in that segment, so I’d say new players like us are making a ton of progress on this segment and a bit on higher education, but I don’t think we compete a lot against traditional colleges. I don’t think we do at all, to be honest.
Alejandro: Imagine, Pierre, that I put you into a time machine, and I bring you back in time to that moment where you were thinking about it with your co-founder of making this go from a personal project to an actual company. You had a chance to go back in time with all of the knowledge, the successes, the failures, the learnings that you’ve been able to get in almost of decade of operating this company, and you’re able to give your younger self one piece of advice before launching a business. What would that be and why, given what you know now?
Pierre Dubuc: I would say it’s hard to give one piece of advice to change everything, but it’s more like be ambitious and trust your gut. Being more ambitious, I think it took us a while until we acknowledged the size of the opportunity, the size of the ambition, and we started talking about it openly. I think we were trying, “Yeah, maybe it can be big,” but we thought it was too much. I think it could have accelerated a few things if we thought this way all of the time. That’s a remark, risk-averse. Trusting your gut is really, I think, most of the time we knew what we had to do, which decisions to take. Sometimes, we were just too lazy, not brave enough, too slow, we were doubting everything, and I would just say, in most cases, I think we were right, but it took us a while to get through the confusion, and maybe we should have just had more self-confidence and just make the decision even if it doesn’t please everybody and move forward, and sometimes be wrong.
Alejandro: I love it. Pierre, for the people that are listening, what is the best way for them to reach out and say hi?
Pierre Dubuc: They can send me an email at firstname.lastname@example.org.
Alejandro: Amazing. Pierre, thank you so much for being on the DealMakers show today.
Pierre Dubuc: Thank you, Alejandro. It was so nice to talk to you.
* * *
If you like the show, make sure that you hit that subscribe button. If you can leave a review as well, that would be fantastic. And if you got any value either from this episode or from the show itself, share it with a friend. Perhaps they will also appreciate it. Also, remember, if you need any help, whether it is with your fundraising efforts or with selling your business, you can reach me at email@example.com.