In today’s digital-first education landscape, students rely heavily on online tools to enhance their learning experiences. One platform that has consistently stood out is Chegg. From textbook rentals to AI-powered study help, Chegg has evolved into a full-fledged education technology powerhouse. But have you ever wondered how Chegg makes money?
Chegg’s smart diversification into subscription services, tutoring, and academic support has enabled it to serve millions of students worldwide and generate impressive revenue. In this blog, we’ll explore Chegg’s journey to success, break down its business model, explain how it makes money, and show you how to build a similar online tutoring platform using a powerful solution like Yo!Coach.
Table of Contents
What is Chegg?
Chegg is a leading American education technology company that provides students with a range of academic services, including textbook rentals, homework help, online tutoring, and career support. Founded in 2005, Chegg began as a textbook rental service but has evolved into a comprehensive student-first platform, offering digital learning tools that address the academic needs of students across the globe.
Chegg’s mission is clear: to improve the overall return on education by helping students save time, save money, and get smarter.
Success Story of Chegg: A Timeline
Chegg’s journey from a textbook rental startup to an EdTech giant is nothing short of inspiring. Here’s a look at its timeline:
- 2005: Chegg was launched as a textbook rental platform by Osman Rashid and Aayush Phumbhra.
- 2007: The company officially shifted focus to textbook rentals, inspired by Netflix’s DVD rental model.
- 2010: Raised $75 million in Series D funding.
- 2011: Chegg acquired Cramster (homework help) and Notehall (class notes marketplace), signaling expansion into digital services.
- 2013: Chegg went public with a successful IPO, trading on the NYSE under the symbol “CHGG.”
- 2014–2019: Acquired several companies like InstaEDU (online tutoring), Mathway (step-by-step problem solver), and Thinkful (coding bootcamp).
- 2020–Present: Chegg positioned itself as a digital-first learning platform, reducing reliance on physical books.
Chegg now serves millions of students worldwide and generates over a billion dollars in annual revenue.
How Does Chegg Make Money? Revenue & Business Model Explained
Chegg operates on a diversified, student-centric business model that blends subscription services, digital tools, online tutoring, and textbook rentals. At its core, Chegg aims to enhance student performance by offering convenient, cost-effective, and personalized academic assistance. The company has strategically transitioned from a transactional model (textbook rentals) to a recurring revenue model through subscriptions and digital services, enabling long-term growth and scalability.
Let’s take a closer look at the key pillars of Chegg’s business model:
1. Subscription-Based Services
One of Chegg’s most powerful business strategies is its subscription model. Students subscribe monthly or annually to services like Chegg Study, Chegg Math Solver, and Chegg Writing, which offer access to a range of academic resources. This recurring model ensures a predictable revenue stream while allowing students to access high-quality, on-demand learning tools.
2. On-Demand Tutoring and Expert Q&A
Chegg offers 24/7 access to online tutoring through a network of subject matter experts. Whether it’s solving complex math problems or getting feedback on essays, students can either connect live with tutors or submit questions to be answered asynchronously. This feature supports flexible, around-the-clock learning—perfect for today’s digital-native learners.
Chegg’s Expert Q&A feature, available through Chegg Study, is particularly popular. Students can submit questions and receive verified, expert-written answers, making this one of the most used features on the platform.
3. Academic Support Tools
Beyond tutoring, Chegg also provides tools like:
- Chegg Writing: A grammar, plagiarism, and citation checker designed for academic writing.
- Chegg Math Solver: Step-by-step solutions to math problems, ideal for subjects like algebra, calculus, and statistics.
- Homework Help: Includes textbook solution manuals, video explanations, and custom answers from experts.
These tools are bundled into comprehensive subscription packages like the Chegg Study Pack, which includes multiple services under one plan.
4. Textbook Rentals and Sales
Chegg originally made its mark by disrupting the expensive college textbook market through affordable rentals. Though digital services have become its primary focus, textbook rentals (both physical and eTextbooks) remain part of its offering. Chegg allows students to rent, buy, and even sell back textbooks—either directly or through partner vendors. This part of the business complements its academic support tools by reducing costs for learners.
5. Career and Skills Development
Chegg also focuses on post-academic success through career readiness tools and skill development. Through its acquisition of Thinkful, the company offers online coding bootcamps, career coaching, and skill-based learning for in-demand job markets like tech, design, and data science. This positions Chegg not just as a student platform but as a lifelong learning partner.
6. B2B Partnerships and Advertising
Another facet of Chegg’s business model is its advertising and partnership programs. By leveraging its massive student user base, Chegg provides brands and educational institutions with targeted advertising opportunities. These partnerships allow third-party services and institutions to reach engaged, niche audiences within the student ecosystem.
7. Data-Driven Personalization
Chegg uses advanced analytics and AI to deliver personalized recommendations, content, and learning paths. This customization enhances user experience and retention, helping the platform stand out in a competitive EdTech market.
Want To Incorporate Multiple Revenue Streams Into Your Online Tutoring Platform
In Summary: Chegg’s Revenue Flywheel
Chegg has created a revenue flywheel where students come for homework help or textbook savings and stay for deeper, value-added services like tutoring, test prep, and career development. With each added feature or service, Chegg not only meets more student needs but also increases lifetime customer value (LTV).
| Revenue Stream | Model Type | Description |
|---|---|---|
| Subscriptions | Recurring | Chegg Study, Study Pack, Writing, Math Solver |
| Tutoring Services | Transactional/Hourly | Live 1:1 sessions and homework help |
| Textbook Rentals/Sales | One-Time/Recurring | Physical and digital books for rent or purchase |
| Expert Q&A | Subscription/Usage | Pay experts to solve queries, monetize via subscription |
| Skill Development (Thinkful) | Program Enrollment | Career bootcamps, ISAs, and certification courses |
| Advertising | B2B Sponsored Content | Paid promotions to reach the student audience |
| International Expansion | Market-Specific | New localized services and pricing models |
Chegg’s revenue model thrives on retention, upselling, and diversification. By offering a range of academic and career tools under one roof, Chegg builds an ecosystem that not only attracts users but also continuously monetizes their journey, from high school to career transition.
How to Build an Online Tutoring Platform Like Chegg
Building an online tutoring platform like Chegg demands a strategic blend of educational value, advanced technology, and an intuitive user experience. As a leader in the EdTech space, Chegg has set a high benchmark through continuous innovation and a diverse range of services. However, aspiring entrepreneurs can replicate similar success by focusing on the core components that enhance user engagement and drive sustainable revenue. Below are the essential steps to help you build a robust and scalable online tutoring platform :
1. Identify Your Target Market
Start by narrowing down your audience. Are you catering to school students, college learners, or professionals seeking skill development? Understanding your users’ pain points helps you offer tailored solutions, just like Chegg did with homework help, textbook rentals, and expert Q&A.
2. Choose Must-Have Features of your Online Tutoring Platform
To compete with platforms like Chegg, your platform should offer:
- Tutor profiles with ratings and subject expertise
- Live video sessions and interactive whiteboards
- Homework help or Q&A functionality
- A secure student dashboard
- Flexible payment and subscription options
Adding value through user-friendly design and mobile compatibility is key to retaining students and tutors.
3. Decide on a Revenue Model
You can monetize your platform in several ways:
- Subscription plans (monthly/annually)
- Pay-per-session or hourly tutoring fees
- Commission from tutor earnings
- Ads or sponsored listings
Combining multiple models allows you to diversify revenue and reach a wider audience.
4. Choose Between Custom Development or a Ready-Made Solution
There are primarily two development approaches: Custom Development and Ready-made solutions.
Custom development involves building your platform from scratch. You need to hire or outsource a team of web developers and designers. This development process requires a high investment of time and money.
Other than custom development, you can opt for a ready-made white-label solution like Yo!Coach, which comes preloaded with essential features. Using a turnkey solution reduces development time, cost, and go-to-market efforts, making it easier to focus on growth and user acquisition.
5. Focus on Quality Tutors
The success of a tutoring platform hinges on tutor credibility. Set up a robust onboarding process, including verification, assessments, and demo sessions to ensure quality delivery. Let students rate and review tutors to build trust.
6. Ensure Security and Scalability
Invest in secure payment gateways, data privacy measures (like GDPR compliance), and cloud-based infrastructure that supports future growth. A stable, secure platform builds user confidence and supports long-term expansion.
7. Promote and Optimize the Platform
Use SEO, social media, email marketing, and student referral programs to attract and retain users. Continuously monitor analytics to optimize your features and user journey.
Why Choose Yo!Coach to Build Your Online Tutoring Platform?
Yo!Coach is a ready-made, white-label software specifically designed to build online tutoring and consultation platforms. If you aim to replicate Chegg’s success, Yo!Coach provides the ideal launchpad with features like:
- Real-time video conferencing (Zoom, Lessonspace, CometChat integration)
- Tutor and student dashboards
- Multilingual and multi-currency support
- Commission and subscription-based monetization
- White-label customization
- Secure payments with multiple gateways
Whether you’re targeting academic tutoring or professional skill development, Yo!Coach empowers you to launch quickly with minimal overhead.
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Conclusion
Chegg’s journey from a humble textbook rental company to a billion-dollar EdTech enterprise showcases the power of innovation and adaptability. Its revenue model—anchored in subscriptions, tutoring, and digital tools—offers a blueprint for aspiring entrepreneurs in the education space.
If you’re inspired by Chegg’s success and want to build your own online tutoring platform, Yo!Coach offers the perfect foundation with cutting-edge features and business scalability.
Frequently Asked Questions
Q1. Is Chegg profitable?
Ans. Yes, Chegg has maintained profitability in recent years, primarily due to its digital subscription services and reduced dependency on textbook rentals.
Q2. What are Chegg’s main services?
Ans. Chegg offers study help, online tutoring, textbook rentals, writing assistance, math problem-solving, and career development programs.
Q3. How much does Chegg cost for students?
Ans. Chegg Study starts at $14.95/month, while the bundled Chegg Study Pack costs around $19.95/month. Additional services like writing and tutoring may have separate fees.
Q4. Can I build a platform like Chegg without coding?
Ans. Yes, with platforms like Yo!Coach, you can launch a Chegg-like platform without technical expertise using its no-code/low-code infrastructure.
Q5. How long does it take to launch an online tutoring platform?
Ans. With a ready-made solution like Yo!Coach, you can launch your platform within a few weeks, depending on customizations.
