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Should Microsoft Acquire Coursera?
August 14, 2014 - 9:00pm

My strong hunch is that Daphne Koller and Andrew Ng and Richard Levin have no interest whatsoever in being acquired by Microsoft or anyone else.

But let’s go with this thought experiment.

What would be the pros and cons of a Microsoft acquisition of Coursera?

Why am I jumping to Microsoft? Why not Google or Facebook or Oracle or Amazon or anyone else?

Mostly because I think that Microsoft would leave Coursera alone. Even better, I think that Satya Nadella would look to Coursera to help Microsoft evolve its own culture. To become the more nimble, open, and risk taking place that Nadella needs Microsoft to become.

Microsoft would have the resources to take the whole Coursera revenue equation off the table. Coursera under Microsoft would be able to focus on its core mission to provide access to free online education to anyone in the world without the distraction of having to realize a return for the early investors.

What Microsoft could gain from Coursera is lots of international good will and lots credibility within the higher education community. This is assuming, of course, that Microsoft commits to fund and protect Coursera and to leave the operation independent and non-commercial.  

The other reason why this could work is that all of Coursera’s infrastructure could also migrate to Microsoft’s Cloud. Microsoft would gain the ability to tell some terrific stories about how its technology is being utilized to support global learning at scale. The cloud story is obvious, but maybe Microsoft could help accelerate Coursera’s growth on mobile platforms.

The main reason why a Microsoft acquisition of Coursera could work is the numbers involved. When compared to other tech, gaming, music and entertainment platforms a Coursera acquisition would be amazing affordable. According to Crunchbase, Coursera has received $85 million in funding over 4 rounds. Let’s say for the sake of argument that a fair price would be $200 million. The investors double their money.  Microsoft has over $80 billion on hand in cash. This would not be a big purchase for Microsoft.

Once Coursera is purchased by Microsoft how much money would the company need to devote each year to keep Coursera running? $10 million a year? $20 million?   

This is a drop in the bucket, I think, for the branding and culture and leadership benefits that Microsoft would be getting.    

Who knows, Microsoft may even find a way to help Coursera appropriately offset its costs simply by leveraging its infrastructure to enable an expanded global reach.  

What would Microsoft need to do to assure you that Coursera’s long-term mission would remain intact and undisturbed following an acquisition?

Are we thinking creatively enough about alternative models to fund open online education at scale?


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