• September 2, 2014

Providers of Free MOOC's Now Charge Employers for Access to Student Data

Andrew Ng TIME

Jemal Countess, Getty Images

Students and universities can opt out of Coursera's new employee-matching service. Andrew Ng, one of the founders of the company, describes the program as "a relatively uncontroversial business model that most of our university partners are excited about."

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close Andrew Ng TIME

Jemal Countess, Getty Images

Students and universities can opt out of Coursera's new employee-matching service. Andrew Ng, one of the founders of the company, describes the program as "a relatively uncontroversial business model that most of our university partners are excited about."

Providers of free online courses are officially in the headhunting business, bringing in revenue by selling to employers information about high-performing students who might be a good fit for open jobs.

On Tuesday, Coursera, which works with high-profile colleges to provide massive open online courses, or MOOC's, announced its employee-matching service, called Coursera Career Services. Some high-profile tech companies have already signed up—including Facebook and Twitter, according to a post on Coursera's blog, though officials would not disclose how much employers pay for the service. Only students who opt into the service will be included in the system that participating employers see, a detail stressed in an e-mail message that Coursera sent to its nearly two million past or present students on Tuesday.

Each college offering a course through Coursera is also given the chance to opt out of the service—meaning that if a college declines, then no students in its courses can participate in the matchmaking system.

"Some universities are still thinking it through, so not all have said yes," Andrew Ng, a co-founder of Coursera, said in an interview on Tuesday. "I don't think anyone said, 'No now and no in the future,'" he added. "This is a relatively uncontroversial business model that most of our university partners are excited about."

Udacity, another company that provides free online courses, offers a similar service. Udacity works directly with professors to offer courses, rather than signing agreements with colleges.

Udacity's founder, Sebastian Thrun, said in an interview that 350 partner companies had signed up for its job program. While Mr. Thrun would not say how much employers pay, he characterized the fee as "significantly less than you'd pay for a headhunter, but significantly more than what you'd pay for access to LinkedIn," a popular social network for job hunters.

"We're more like a headhunter," said Mr. Thrun. "We go through our database and find people that seem to be good matches for the openings from these companies." Udacity says companies using its job-matching program include Google, Amazon, Facebook, and several tech start-ups.

In the case of one computer-science course offered through Udacity, the online students took the same quizzes and tests as a group of students enrolled at Stanford University at the same time. The top 411 students all came from the thousands of students who took the course online, with the strongest-performing Stanford student ranking 412th in the final standings, said Mr. Thrun. (That Stanford student earned a 98-percent score in the course.)

"There are a huge number of people out there who are extremely skilled but happen not to have the Stanford degree," said Mr. Thrun.

How the Coursera Model Works

Coursera said that it had been quietly testing its career-services system for a few months, but that it was in place only for courses in software engineering. Other disciplines will be coming soon, though Mr. Ng would not say when.

Here's how it works: A participating employer is given a list of students who meet its requirements, usually the best-performing students in a certain geographic area. If the company is interested in one of those students, then Coursera sends an e-mail to the student asking whether he or she would be interested in being introduced to that company. The company pays a flat fee to Coursera for each introduction, and the college offering the course gets a percentage of that revenue, typically between 6 and 15 percent.

Mr. Ng noted that Coursera might try other types of matchmaking arrangements in the future, depending on how well the current model works for students and employers.

"Today everyone has access to an infinite source of résumés, so it's a time-management issue," said Mr. Ng. "The question is how many résumés you need to read to find a candidate you'd like to speak with. Students who complete and do well in [Coursera] classes have a very high chance of being interesting to employers."

Dawn Smith is one student who found a job with the help of a Coursera course, though she did so before the company set up its matchmaking service. Ms. Smith wanted to change careers, so she took a pharmacology course offered through Coursera by a University of Pennsylvania professor. She completed the course—meaning she scored at least 90 percent on homework and examinations—and got a certificate, which she listed on her résumé. And she mentioned the achievement during a recent interview with the University of Illinois Hospital and Health Sciences System Cancer Center, which ended up hiring her for a job in communications.

"It sort of showed the initiative of wanting to continue my education," she said.

She said that she would sign up for Coursera's new career services if she was looking for a job, but only if she knew that she was going to devote time to the class and had a good chance of doing well.

"The biggest question mark," she said, "is if I do take up that offer and I found myself not able to complete this, how will that reflect to a potential employer?"

With that type of reluctance in mind, Coursera gives students the option to show employers information about them only if they complete a given course.

One Udacity student, Tamir Duberstein, said that company's job program had helped him land a gig at Square, a trendy company that lets consumers submit credit-card payments using smartphones and tablet computers. He was living in Toronto, working at a job he didn't enjoy, when he took a series of computer-programming courses from Udacity, spending nearly all of his free time on them. "I got the best possible result in a few of them," he said.

One day this past summer, Udacity sent him an e-mail asking whether he'd be interested in sending in his résumé as part of its job service. "Once your résumé is received, it will be prescreened and possibly shared with a few selected employers with your permission," the message said.

He sent his in, but didn't expect much. "I was like, What the hell, sure, why not?," he remembers.

A few weeks later, he heard first from one tech company and then from Square.

Mr. Duberstein said that the job-interview process included plenty of technical questions asking him to prove he had the skills that he had learned in the Udacity courses. "The point here is not credentialing," he said. "They quizzed me. They really were assessing what I know for themselves."

Softer Skills

Both Coursera and Udacity show employers more than just student grades. They also highlight students who frequently help others in discussion forums.

Mr. Thrun, of Udacity, said those "softer skills" are often more useful to employers than raw academic performance.

"Problems are never solved in isolation in the real world," he said. He said that Udacity might share with an employer someone who has helped 90 to 100 people in discussion forums. "That specific skill has been a better predictor of placement success than academic performance," he added.

Mr. Ng, of Coursera, reported a similar trend. And frequently the top-performing students also post the most valuable comments in student forums, as counted by how many students "vote up" a comment, or signal that it was helpful by clicking a thumbs-up button. "Students in the top 10 percent had twice as many up-voted posts in the student forums as the students not in the top 10 percent," he said.

Coursera has already made its first introductions, though it has not stated how many, or whether any led to a job.

Mr. Ng said that the largest source of revenue will probably come from selling certificates, rather than such matching. So far the company has not charged for certificates, but it plans to start doing so in the coming months.

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