How a College Review Website Pivoted to An Education Ecosystem
Choosing which college to attend can be a headache. Campus tours and information sessions are time-consuming and often cannot show what real college life is like. That’s the market need Unigo.com eyed when it first started: peer-to-peer college reviews. But by significantly expanding its student database, it pivoted to an entire education ecosystem.
Unigo.com initially served as a platform for college students to write reviews about their schools for high school applicants. It started with $500,000 in angel investment in 2008 before receiving $1 million series A funding in 2009 and $1.6 million series B funding in 2012, according to Crunchbase data. In 2014, the startup redesigned the site and teamed up with Plus-U.com and scholarshipexperts.com to become an integrated resource center.
Plus-U was a web page for students to match up with colleges. Students also searched for scholarships through ScholarshipExperts’ database. EDPlus Holding, the holding company of Plus-U and ScholarshipExperts, acquired Unigo.com in 2014. The two subsidiaries were consolidated into the merged entity that formed the new Unigo.com website, providing college and scholarship matching features. Estudentloan.com, another subsidiary owned by EDPlus, was also incorporated into Unigo.com as its student loan arm.
To get better matching results, students need to submit exhaustive details, such as academic background, extracurricular interests and personal information. “The student data is valuable to colleges,” said Brad McMahon, President of Unigo. “They voluntarily give us their information.”
These new functions expanded Unigo’s database of student information, enabling them to aggregate student profiles all on one platform. Colleges and universities were also provided services such as hosting live web events, one-on-one counseling sessions, premium school profiles and email marketing targeting at potential candidates. The goal for schools is to attract more high-quality candidates while reducing the cost per enrollment, according to McMahon. The revenue of Unigo comes from a model they call B2E (Business to Education).
“We currently have about 30 customers,” McMahon said. “Before, we were making less than $1 million in revenue but now we are growing at 100 percent year-by-year rate.” Unigo.com now generates 650,000 reviews of 7,000 U.S. colleges, aggregating a scholarship pool of $3.6 million.
In addition to educational institutions, Unigo shares student information with non-affiliated third-parties that are interested in contacting its users. Although McMahon said Unigo doesn’t sell email addresses, it gave other organizations more ways to utilize the student data collected by Unigo.
One user, John Hoop, commented on Unigo’s Facebook page in January this year that “This website sold my email address to dozens of ‘career’ spammers. WARNING.” Hoop claimed to have received over 1,000 spam emails from non-Unigo brands. He said no other questionable site received his email at or near the time the spam problem developed.
“We serve close to 12 million users each year, and the concerns raised by this user and others are certainly in the very small minority of feedback we receive from our user community,” McMahon responded.
In July 2016, Unigo.com and estudentloan.com were sold to EducationDynamics, an education marketing and admissions solution provider, after the private equity firm Aequitas Capital Management — which owned EDPlus Holding, the parent of Unigo Group — collapsed. Aequitas had been sued by the Securities and Exchange Commission in March 2016 for allegedly running a $350 million Ponzi scheme in which the firm secretly ploughed client money they claimed was being invested back into the company.
“The collapse of Aequitas Capital made things difficult for the business operations and employees — many of whom had to be let go,” McMahon said. “The sale to EducationDynamics was a good outcome, however, and we are excited to get back to the business.”