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“When it comes to skilling, the aspiration of Indians is unlimited. People are super driven even in Tier 2 and Tier 3 India to learn new skills because it directly results in higher income. But people need motivation at every step.” – Josh Skills cofounder Supriya Paul.

For Paul, the cofounder and CEO of Josh Talks and its edtech vertical Josh Skills, the search for product-market fit never stops. That’s one of the biggest learnings over the course of the startup’s life since 2015, when it was founded by Paul and Shobhit Banga, who heads the product role at Josh.

Since then it has pivoted several times — it started with offline events and then launched a YouTube channel for expert talks in English and Hindi, before venturing into regional language content. After a few years of scaling up the Josh Talks platform, in late 2019, the company jumped into edtech and skilling with a Coursera-like approach called Josh Skills.

And now after iterations to its product based on feedback from learners, Josh Skills is diving deeper into individual courses, and creating a gamified environment by targetting cohorts of learners.

It’s been a journey that’s taught the founders and Josh Talks a lot about how the online learning space is evolving, and hitting peaks of maturity in certain areas, Paul told Inc42, ahead of today’s announcement of a $3.5 Mn funding round led by Ankur Capital.

Marquee angel investors such as Paytm CEO Vijay Shekhar Sharma, Better Capital founder Vaibhav Domkundwar, SUGAR Cosmetics cofounder and CEO Vineeta Singh, OYO’s Ritesh Agarwal and entrepreneur Ankur Warikoo also participated in the round. This follows Josh Talks’ last funding round of $1.5 Mn, raised from New York-based Media Development and Investment Fund (MDIF) back in 2020.

The startup will utilise the freshly raised funds to refine the social learning aspects of the Josh Skills product and bring more paying subscribers to its platform. It is also looking to experiment with new product lines catering to the growing aspirations of the Tier 2 and Tier 3 users in India.

“We are looking at ramping up hiring for product and engineering roles at leadership positions, as well as for sales, content development and partnerships,” Paul said.

Josh Skills’ Customer Acquisition Story

As an offshoot of Josh Talks, Josh Skills today focusses on upskilling individuals in areas such as spoken English, personality development, personal finance management, and more. So far, the spoken English course is live on the app, while other topics and courses are being developed with a focus on leveraging the distribution and the user funnel of Josh Talks.

The pivot from the Coursera-like approach of self-paced learning to the focus on individual courses and live learning took 18 months, but it was worth it, Paul said, given that live learning is proving to be the better approach in edtech.

In fact, across the industry, the focus has shifted from self-paced learning to live tutoring, multi-teacher models and hybrid learning. The likes of BYJU’S, Unacademy, Vedantu and others have all moved to one or the other version of live learning in keeping with this demand.

 “After conducting hundreds of user visits/calls, we realised that the Coursera model wasn’t working for us. Before we expanded our course offerings, we needed to dive deeper into one course and create a social learning environment that our users find enjoyable,” Paul added.

Josh claims to run one of the largest networks of non-entertainment channels on YouTube in India, averaging 85 Mn monthly views across its channels and the native app, and on track to hit 100 Mn this month. Leveraging this massive distribution funnel, the company made a foray into interactive courses with the Josh Skills app during the pandemic. The app has seen more than 3.2 Mn downloads since its launch, and Paul claims it has over 200,000 paid subscribers from Tier 2 and 3 cities of India.

The customer acquisition cost or CAC is a key focus for Josh Skills. “We saw that when we went for paid acquisitions, for our transaction value of INR 500 per user, we failed miserably. At low spends, we could make some money, but as we started growing our spending and targetted more users, the return on ad spend was very low.”

So Josh turned to a model that’s scalable and does not rely on advertising, because it realised that customers won’t pay more than INR 500 for the course. In fact, Paul said that of the 200,000 paid subscribers, around 75-80% of users were purchasing an online course for the first time. Because it couldn’t increase the pricing of its courses, Josh turned to distribution to solve the challenge.

And here too, like other edtech giants such as Unacademy, the company banked on YouTube and its reach and penetration in the Indian market. Paul believes that a robust platform like YouTube makes it much easier for startups to streamline distribution and bring in efficiencies in acquisition. YouTube is already the destination for casual learning and by leveraging this, Josh was able to convert users from just content consumers to learners.

English speaking and learning is a massive opportunity in the Indian market, which is home to over 530 Mn non-English internet users. As for competition, Josh does have the likes of Duolingo, Babbel and others as global competition for English learning, and within the Indian market, Josh Skills has rivals such as PlanetSpark, Enguru, Hello English, and Multibhashi among others.

The Retention Game In Edtech

Currently, the majority of its courses are in Hindi, but Paul recalled the spurt in non-Hindi users in the wake of the pandemic, which totally changed the focus for Josh Talks and Josh Skills. At the same time, the demands of learners were maturing. Banking on the success of its Hindi-to-English learning module, the company is looking to add English learning through Marathi, Telugu, Tamil over the next few months. These courses are already available to select users.

“We have been able to understand the aspirations of young India and have built one of the largest online communities, which is in turn directed towards the Josh Skills app with zero customer acquisition cost (CAC),” the Josh Skills cofounder and CEO added.

But content is just one end of the funnel, where users and potential learners come into the Josh fold. Retention is a different beast altogether. How has Josh managed to retain the users who have spent INR 500 for its course and what does it do to keep them using the app?

For this, the app turned to gamification and peer-to-peer learning, looking to mimic the social learning and support group concepts that are seen in colleges and schools. Besides this, Paul said existing solutions like Duolingo have shown the path for gamified learning. Today, Josh Skills offers courses in six languages with a focus on peer-to-peer learning as well as social elements to gamify the courses.

“Sometimes, it’s not about reinventing the wheel, but using what already works in the real world and adapting it for your model. We saw that talking to peers and asking them your doubts works so well in the offline world, so we translated this for our app,” Paul added.

Colleges are not just about the degrees, but also about the relationships developed with peers and the feeling of being in a community. That’s what Josh Skills is looking to replicate.

“This demographic is coming online for the first time and we are bridging educational and exposure gaps for them through first principle thinking. The first aspiration that we saw in our audience was the need to want to learn English — not only for education and job outcomes but for a seat at the table,” Paul added.

Not knowing English often makes Indians from smaller towns feel inferior and that’s why Josh focusses on speaking and fluency. The CEO said that beyond English speaking, aspirations of Indians such as government jobs, test prep, engineering, coding and others are being explored. “We are using a part of this capital to prove our distribution out and test additional categories beyond vocational skilling as well.”

Social Learning Takes Centre-Stage

Cofounder Shobhit Banga believes that when learning happens in a social context, it leads to better educational outcomes and higher retention rates. “On average, a user spends 51 minutes daily on the Josh Skills app, conversing in English which is a testament to the product’s success,” he said

Further, within English speaking, the social learning aspect has taken off. Josh gives awards to the most active students every day, and on average these learners spend over eight hours talking to their peers through voice messaging and improving their fluency.

Unlike other platforms, Josh Skills currently only offers a one-day free trial to learners, but Paul added that the app is looking to experiment with more freemium features in the next few months, including free voice messaging for a certain number of minutes and other feature-based freemium plans.

While so far, Josh Skills app only has the English learning course, the platform is banking on its database of high-quality content across categories for its next batch of courses. For instance, Paul said that personality development, personal finance management, are all areas that can be covered by Josh with individual verticals given the bank of content that already exists.

The idea is to help fulfil the most basic goal for most young learners in India — i.e. the potential to earn a higher salary. Paul claims that for someone who is earning INR 15K to INR 20K per month, even a 10%-20% boost will be a lot.

And that’s the audience that is looking at Josh Talks for motivation and the right guidance. The key according to the Josh Skills founder is trust.

“We are still at such an early stage that the first hurdle is trust. There is no bigger testament of trust than when a learner clicks on our video, downloads the app and then pays for an online course for the first time in their life,” Supriya said.