E-Learning Marketplace Development: Cost to Build eLearning Platform

The cost of marketplace development is not only hard to determine. It’s also the reason 29% of startups fail. By failing to accurately estimate the cost of development before the whole process starts, you set yourself up for business failure.

Along with that, there are multiple misconceptions related to development costs. Unfortunately, it isn’t possible to talk about precise figures.

The Udemy eLearning website was built more than 10 years ago, but there’s still a huge team of professionals contributing to the platform’s development. To date, Udemy has invested hundreds of millions of dollars in the Udemy website and app. Does that mean you need a few million dollars to launch an eLearning project? Of course, it doesn’t.

You can begin a successful eLearning platform with a minimal budget and attract investments for further development.

The product that allows you to attract your first investors, validate your idea, and collect users’ feedback is called a minimum viable product, or MVP. Today, you’ll find out how much it costs to build an MVP for an eLearning marketplace.

We recently wrote an article on how to build an eLearning marketplace from scratch. It contains an extensive guide to developing your business model canvas and getting ready for your business launch. If you haven’t already, take a look at that article before you continue reading about the cost of building an online learning platform.

In this article, you’ll learn how to:

• Finish and polish your business model canvas for an eLearning marketplace website
• Optimize your budget and calculate how much external investment you may need
• Cut the unnecessary cost of eLearning development and build a high-quality product with a low budget

Cost to build an eLearning marketplace

Numerous websites and calculators promise to give you a detailed estimate of how much it costs to build an eLearning website. However, no programmer or company — let alone an online calculator — can give you a precise estimate until they get acquainted with your idea and requirements.

In this article, you’ll find a thorough analysis of the two main factors that impact your website’s price:

• Features you’d like to include and the time needed to build them
• Your development team (and the team’s location)

By understanding the website development process and the main price-forming factors, you’ll be able to estimate the development cost for your eLearning application by yourself. Let’s go!

Key features for an eLearning marketplace MVP and how much time you need to implement them

We’re talking about building a minimum viable product because at the initial startup stage, founders are usually short on money and time. They can’t allocate a solid budget to developing a full-featured application, and they actually don’t have to. The goal of an MVP is to release a good enough app as fast as possible and for as little as possible.

An MVP allows you to test your idea, get user feedback, and present your concept to investors. If all goes to plan, you’ll get money for further development and an understanding of your target market.

For an eLearning MVP, you’ll have to focus on four components:

• A landing page for your marketplace website
• A web app for students
• A web app for teachers
• An admin platform

On average, a development team needs 1,000 hours and more to build the basic functionality for an online marketplace. This is how that time is distributed:

This table is based on our own experience building marketplace projects. Your website may have unique features, so your final estimate may be quite different from this one. 

Now let’s take a look at the components you should definitely include in your educational marketplace MVP.

Landing page

Users will access your landing page from search engine results. It should include basic information about your company, goals, team, and services. Don’t underestimate the importance of a landing page, as it’s your key tool for attracting visitors to your eLearning marketplace and converting them into loyal users.

After registering on your landing page, users should be able to access your web application.

Features for teachers and students

These features are essential for both teachers and students:

• Authentication

Quick sign-in is the first step to long-term use. Let users sign in conveniently using an email address, phone number, or social media account. Integration with Google, LinkedIn, and Facebook enables one-click authorization and allows you to collect data from a user’s profile.

As part of your marketing strategy, ask users to subscribe to your newsletter on the sign-up page.

• Personal profiles

Make a user personal profile a convenient web page with intuitive design. When starting to build your platform, there’s no need to implement extraordinary features. Allow users to add basic personal information and photos, help them define interests, or even let them add friends. Knowing a user’s interests and preferences will help you make suggestions and advertise potentially interesting courses.

• In students’ personal profiles, show completed and active courses and provide a wishlist feature.
  In addition, let users monitor progress on a dashboard in their personal profiles. Show students a list of active courses they have access to, hours spent studying, marks or ratings, etc.
• In teachers’ personal profiles, allow teachers to upload videos, images, texts, and other educational materials.
  On their dashboards, teachers should see the courses they provide, a list of active students, reviews from students, etc.

Information provided on the user profile will depend on the specifics of your marketplace. You can show payment history to students and payout history to teachers. You can also add an advertising section or other elements to engage users. For example, gamification elements may encourage students to spend more time studying on your website.

• Chat

An eLearning marketplace isn’t just about watching terabytes of educational videos; it’s also about effective communication between students and course providers. To help users interact efficiently, integrate a communication window in your website. You can either add a Message Me button to all user profiles or allow users to chat with classmates in their courses.

Depending on your website’s requirements, you can integrate a third-party messaging service and cut development time.

• Payments

Paid courses are the cornerstone of your marketplace’s profitability. Make the payment process simple and secure. Investigate the local market and find out which online payment methods are the most popular: credit card, PayPal, Google Pay, or any other options. Learn about online payment gateways and decide which will be best for your platform.

• Switching between account types

A skilled public relations specialist who studies interior design on your website may want to make money by sharing their knowledge of PR. Why not let them do it using your platform? The ability to be both a student and an instructor is the main concept of a two-sided eLearning marketplace.

Make switching roles simple and effortless, and don’t miss the chance to increase user engagement.

Features for instructors

To make your platform convenient to use for instructors, make sure to implement the following must-have features:

• Course management

An Add Course page/tab is an essential element of a teacher’s profile. Allow instructors to add a course title and description; audio, video, and PDF files; and other materials needed to teach a course. Optimize your website’s performance and make uploading content as fast and seamless as possible. Let instructors choose the target audience for each course and modify or delete courses.

You should also let instructors attach YouTube videos to their courses, but make sure to add a Copyright section to your Terms and Agreements page to protect content from copyright infringement. Strengthen your platform with live streaming features to enhance communication and make learning even more attractive for potential users.

When you have more resources in the future, you can extend your web app’s functionality, provide features for developing interactive lessons, create automated homework checking tools, allow teachers to promote their courses, and do much more.

• Reviews and ratings

Let students rate and leave reviews for each course. Add these ratings and reviews to an instructor’s profile and make them visible for all platform users. A rating system may increase the trustworthiness and transparency of your platform. It’s real proof that users like your website and its content.

Features for students

In your MVP, enable access to several student-oriented features:

• Search bar

Place the search bar at the top of the web page and make it visible but not annoying. Set up algorithms that suggest relevant courses based on keywords entered, a user’s interests, and other information about a user. The smarter your algorithms, the better the chance a student will sign up for a course from the list of suggestions.

• Categories

If users don’t know exactly what they’re looking for, let them browse and filter courses. By browsing within categories, a user may find a course that meets their needs and interests.

Keep in mind that categories are only useful if your platform contains multiple courses on multiple subjects. You may need to add this feature to your platform a bit later when the number of courses rises.

• Recommendations

Analyze each user’s education, hobbies, preferences, and passed courses to recommend relevant courses. Once again, a smart algorithm will save the day.

Admin panel

An admin panel is essential to manage platform relations, block users, approve created courses, etc. At the beginning, an admin’s responsibilities may be limited. However, they may extend as your platform grows.

Sounds like a solid scope of work to fill those 1,000 development hours, doesn’t it? Let’s find out who’s responsible for what parts of this process.

Development team members

Developing an MVP is not a task to assign to a single developer. Although a single developer may bring some results, it’s impossible to get a high-quality eLearning product by hiring one contractor from Upwork. There are several more roles you should get acquainted with. The good news is the expertise of these specialists will help you prevent risks and mistakes, minimize development time, and optimize your budget.

Who do you need on your team?

Business analyst

To launch a popular website, you must make sure the market really needs it. A dedicated business analyst can help with that. A few hours invested in research and analysis will take you closer to your goals. A business analyst may already have expertise in marketplace development or even the EdTech domain. They may help you understand your users’ needs and adapt your idea to users’ expectations.

UI/UX designer

A user interface (UI) and user experience (UX) designer develops a visual prototype of your app, creates a style guide with color schemes and typefaces, designs a logo, and deals with multiple other tasks. A UI/UX designer collaborates with the business analyst to make your website visually attractive. Even more than that, a designer develops user experience scenarios and builds relationships between different website screens to make sure the user journey through the web app is smooth and enjoyable.

Software engineer

When the design prototype is ready and the product owner approves it, coding starts. At this stage, software engineers create the entire structure of the website. A backend engineer develops the website’s functionality and establishes connections to the database and APIs — all the things users can’t directly access. A frontend engineer builds the user interface or the part of the website visible to the user.

Quality assurance engineer

Software development and testing are simultaneous processes. A QA engineer checks every little piece of functionality and makes sure everything works properly while developers are busy working on new features. A QA helps to detect and fix any issue as soon as it emerges without ruining the app’s entire architecture.

Project manager

To avoid engineering anarchy, there must be someone to keep an eye on the team. While you play the role of product owner and are involved in business-related tasks, your project manager will be responsible for planning, organizing the team, managing time and risks, and monitoring progress.

Altogether, you’ll have to employ at least two software developers, a testing engineer, and a project manager full-time. At the MVP stage, you won’t need the services of a business analyst or a UI/UX designer on a full-time basis, so your cooperation with these specialists can be project-based.

Cost to build an eLearning marketplace website in-house

As we calculated earlier, you’ll need to invest at least 1,000 hours in MVP development.

We’ve analyzed up-to-date monthly salaries for specialists in different countries on Indeed and PayScale. The figures below account for two developers, a QA engineer, and a PM (all in-house, full-time):

However, this isn’t going to be the final price, as there are many more expenses to keep in mind. Remember that you need a business analyst and a UI/UX designer to build your startup. To optimize expenses, you can build project-based cooperation. There’s no need to hire these specialists on a full-time basis for MVP development. Delegating these services to third-party agencies will cost you approximately $8,000.

For starters, recruitment and hiring are rather expensive as well. Whether you hire a dedicated HR team or delegate this task to an external agency, your recruitment and hiring expenses may jump to $2,000 or more a month. Along with that, office rent, hardware and software, cloud services and hosting, legal fees, and so much more require extra investment.

Is there a cheaper alternative? Yes, and we talk about it in the next section.

Cost to build an eLearning marketplace website with outsourcing

Hiring an in-house development team may be highly effective for well-established businesses with stable revenue. Udemy has several offices and can afford to employ dozens of in-house software engineers to continuously work on the Udemy web and mobile apps.

However, at the MVP development stage, hiring an in-house team may be too expensive. Fortunately, there’s an alternative — outsourcing software development.

One of the strongest advantages of outsourcing is that you can save time and money. There’s no need to look for and rent real estate and no need to buy equipment or investigate the rates of different hosting providers.

When outsourcing, you hire an entire team at once. After the initial interview, the discovery stage, and requirements discussion, the development process starts. But you pay only for the actual work done — no expenses for rent, equipment, or HR operations.

Another competitive advantage of an outsourcing team is its experience. Outsourcing agencies typically work with dozens of applications a month and have experience in a variety of fields.

Chances are that an outsourcing team has already worked with projects in your industry, and their expertise will be to your advantage.

When outsourcing, you’ll have to choose between onshoring, nearshoring, and offshoring.

Onshoring means outsourcing work to a company located in your city, region, or country. This seems like the most obvious option, but you may be surprised by the hourly rates such companies charge.

With nearshoring, you work with a company in a neighboring country. Here, the savings can be more significant.

Finally, there’s offshoring — working with a company located on another continent. The financial benefits of offshoring are the highest. Just compare the options in the infographics below.

We’ve prepared an extensive guide to offshoring without risks. Take your time to read it carefully if you’re considering this cooperation model.

Hourly rates for software development vary significantly depending on the outsourcing destination. So does the average price for an entire MVP built within 1,000 hours:

However, don’t get lured by the lowest prices. Take into account the best practices for choosing a software development partner. Thorough preparation will help you have a positive outsourcing experience.

The bottom line

The cost to build an eLearning marketplace website depends on two critical factors: your product’s functionality and the development team you choose.

• Functionality

Your product should contain typical eLearning marketplace features as well as unique features that distinguish your marketplace on the local market. Typically, it takes five months or longer to build the must-have features for an educational website. Your team should consist of two full-time software engineers and a test engineer, a part-time project manager, and project-based cooperation with a business analyst and a UI/UX designer.

• Development team (and its location)

Keeping in mind how long it takes to develop an online learning platform, you can roughly calculate the price. To build a high-quality product, you’ll need these specialists:

• Business analyst
• UI/UX designer
• Software engineers (frontend and backend)
• QA engineer
• Project manager

The price for software development services differs between countries.

Now that you know the average cost of building an eLearning app MVP in different countries, you can choose between the two most obvious options:

• hiring an in-house team
• outsourcing app development

Each has its advantages. However, outsourcing seems like the more reasonable choice for a startup without investments. It allows you to start lean, quickly test your idea with the first users, and catch the attention of investors.