Codecademy: Where to Next?

In March 2020, Zach Sims, co-founder and CEO of online education platform Codecademy, prepared for a meeting with his Chief of Staff Kunal Ahuja to discuss the company’s goals. Codecademy billed itself as the largest online resource for computer science literacy and programming skills in the world. It had 45 million active users in 190 countries learning to code by taking its online courses. Ahuja had engaged the leadership team, product managers, and others to outline strategy, with an eye to assessing the venture’s longer-term growth prospects and financing needs. The business had only recently started to focus on monetization. It was early innings, but the company had doubled revenues year on year, it was cashflow positive, and the team was hitting its targets. However, 2019 had been a challenging year, including departures of several key members of its leadership team. Much of Sims’ time late in the year was spent on recruiting to fill open roles, and dealing with inbound interest from investors. From Ahuja’s perspective, the company was “growing up” after the success of its first paid product, Codecademy Pro. But many managers were experiencing burnout given the numerous organizational changes, the grueling work to meet aggressive growth targets, and a host of new processes. How should Codecademy pursue monetization, and how would this decision determine the timing and outcome of its next financing round?