In 2007, Washington University in St. Louis alum Chuck Cohn founded the online learning platform Varsity Tutors. On Friday, its parent company, Clayton-based Nerdy, will reach unicorn status in a transaction that places the company’s valuation at $1.7 billion. A ‘unicorn’ is a company valued at $1 billion or more.
According to an article in the St. Louis Business Journal, Cohn didn’t envision a large online learning platform in his early days of running a tutoring website out of his dorm room. He didn’t begin working on the business full-time until 2011, and Varsity was based in his home until 2014. That was when St. Louis entrepreneurs (and fellow WashU alums) David Karandish and Chris Sims invested in the company, encouraging Cohn to think about Varsity Tutors in a different way.
Originally a service that matched pupils with tutors for in-person sessions, the company has evolved into a platform offering online classes in which experts are able to teach from a handful to hundreds of students at once. In 2019, it also acquired a test-preparation business, Veritas Prep.
The deal will raise $750 million in cash for Nerdy (also the holding company for Verita Prep) and has already lined up a number of high-profile corporate investors. Cohn will remain CEO and will be the largest individual investor.