Wed05152013

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Udacity Snags $15 Million from Andreessen Horowitz

Udacity Snags $15 Million

Udacity, the digital university raised $15 million in Series B, an investment round led by a venture capital firm, Andreessen Horowitz along with existing investors Steve Blank and Charles River Ventures. The organization offers free online courses in Mathematics, Computer Science, Programming and Entrepreneurship, and General Sciences to students who don't have finance, time, inclination or access to study in a traditional university setting.

Andreessen Horowitz, founded by Marc Andreessen and Ben Horowitz, is a company that offers growth-stage funding and venture to the excellent new technology firms. It helps the entrepreneurs in becoming successful CEOs and to develop significant enduring companies.

Sebastian Thrun, the co-founder of Udacity in an interview described that the organization is in early, experimental stage. He said that fund raising is an exercise to understand how to bring education to scale at affordable price. He added that he thinks that Massive Open Online Courses which are coming out of competitors like Coursera, alliances like EdX and companies and universities themselves are an unstoppable movement. In a short period of nine months, Udacity based at Palo Alto, California has actually developed itself as a business model. It started out matching the employers and students and provided new jobs to around 20 people. But the sponsored courses are found to be really working, Thrun said further.

Coursera, introduced by Stanford's two computer science professors raised around $16 million in April from Kleiner Perkins Caufield & Byers and New Enterprise Associates. In the same month, 2U, an educational technology company, announced that it was financing around $26 million in order to boost its services to offer online degrees. According to the National Venture Capital Association, venture which invests in education technology raised around $463.1 million through first three quarters of 2012 from $457.2 total in 2011.

Peter Levine, a lecturer at Stanford's business school and a partner at Andreessen Horowitz based at Menlo Park, California said that Udacity is designed to serve those people who can't afford to pay tens of thousands of dollars per year for completing their education in universities in United States. He is joining the Udacity board as a part of funding and said that investing in online education organizations doesn't mean the universities will be out of business. He further said that educating millions is a radical idea for him but a positive radical one. He is strongly interested in higher education which comes from his time teaching business classes at Massachusetts Institute of Technology and Stanford.

The organization has signed up around 753,000 students until now and some of them are employed at well-known firms. Udacity is raising funds for more number of individuals to reap the benefits of online education without any costs and help them in getting jobs in best companies.