# Tutorspree (2010 – 2013)

- URL: https://girisimcikafasi.com/en/startup-graveyard/tutorspree/
- Sector: Education
- Country: United States
- Total funding: $1.8 million
- Cause of closure: Business model failed

## What did it do?

Tutorspree was an online marketplace that matched students and parents with private tutors in their city. Combining a matching algorithm with human education advisers, the company operated in Chicago, San Francisco, New York, Brooklyn, Washington and Los Angeles.

## Why did it shut down?

Almost all of the company's customers came from Google's organic search results; other channels it tried, such as paid advertising, partnerships and promotions, did not deliver the same returns. In March 2013 a change on Google's side cut traffic by 80 per cent overnight. Although traffic had largely recovered by June, its quality was not what it had been. Commentators also saw the fact that a matched tutor and family could bypass the platform and deal directly as a weak point in the model. In September 2013 the founders decided the business would not scale the way they had intended, closed the company and planned to return the remaining money to investors.

## The story

Tutorspree, founded in 2010 by Aaron Harris, Josh Abrams and Ryan Bednar, was billed as the Airbnb of tutoring when it joined Y Combinator's winter 2011 batch. The New York-based company matched students and parents with tutors in their city. In 2011 it raised a $1 million seed round with participation from Sequoia Capital, Founder Collective, Lerer Ventures, SV Angel and Thrive Capital.

According to the assessment Harris later wrote, almost all of the company's customers came from Google's organic search results. Because search engine optimisation was free, the team had focused on it and become expert at it. In March 2012 the team moved to a new model called Agency, which combined the one-to-one attention of a traditional agency with its own matching system. Revenue doubled within a month, tripled again six months later, and margins rose from 15 per cent to 40 per cent. By December 2012 the company was almost profitable, and at the start of 2013 it raised a further $800,000 from Resolute.vc.

Then came March 2013. In Harris's words, Google pulled the ground out from under their feet overnight, and traffic fell by 80 per cent. Although traffic had largely recovered by June, its quality was not what it had been. Over time the team had tried channels such as paid advertising, partnerships, discount promotions and targeted mailings, but none came close to the returns of search. Commentators also pointed out that the ability of a matched tutor and family to bypass the platform and deal directly weakened the model.

In September 2013 the founders announced that they were closing Tutorspree. Harris said they had built something they were proud of but had realised the business would not scale the way they had intended. The company had reached more than 5,000 tutors in six cities and still had money in the bank when it closed; once creditors and employees had been paid, the remainder would be returned to investors.

## Lessons

- Do not tie customer acquisition to a single channel, especially a search engine you do not control; build a second channel while growth is going well.
- The good unit economics a free channel provides can mask product problems; test in advance whether the model survives if that channel closes.
- In service marketplaces where the two sides can bypass the platform after being matched, give them a reason to find staying on the platform worthwhile for repeat business too.

## Sources

- [Tutorspree, The Tutor-Matching Startup Backed By Sequoia And YC, Shuts Down](https://techcrunch.com/2013/09/08/tutorspree-shut-down/)
- ['Airbnb for tutoring' startup Tutorspree shuts down](https://venturebeat.com/2013/09/08/airbnb-for-tutoring-startup-tutorspree-shuts-down)
- [When SEO Fails: Single Channel Dependency and the End of Tutorspree](https://blog.aaronkharris.com/when-seo-fails-single-channel-dependency-and-the-end-of-tutorspree)