Open LMS Monetization: German bdecent Grows A Plugin Income Stream From Consulting ‘Gemütlichkeit’

bdecent stefan alexander scholz

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Stefan-Alexander Scholz
Co-Founder, and Digital Experience Specialist

Aces of all trades have a leg up in any industry. In EdTech, the much desired but surprisingly uncommon mix of pedagogy and software development skills is an uncontested winner. Add a background in academic psychology, entrepreneurial skills and a small enterprise fueled by positive word-of-mouth reputation, and you get Stefan-Alexander Scholz and bdecent, his learning experience solopreneur venture. The untranslatable German word “Gemütlichkeit” would be a fitting description for his very translatable and clear success.

While bdecent is about to jumpstart initiatives related to the development and promotion of its Moodle and Totara plugins, Scholz is in the privileged position of a thriving consultancy business. While he is keen to turn plugin development into an income stream, they already work as a great business card. They reflect both the quality of his EdTech and his view on approaching learning problems. Not to mention his commitment with the Open community.

Great talking to you, Stefan! Please tell us about bdecent business, and the intersection between consulting and plugin development.

My main business is consultancy, mostly around learning experience, but also more general user experience (UX). My “little plugins” —how I like to call them— are aimed at improving the learning experience in Moodle and Totara. I believe they will be a big part of my future.

I have been involved in learning since 2008. Back then I was working at an agency in Munich. The person in charge of Moodle left, and I told everybody, “Let me try, I can do that.” They gave me 3 months, during which I did nothing but trying to figure out how Moodle works, 24 hours a day. I developed my first theme and had the chance to present it  at a workshop in a Moot in Munich . Several Moodle experts didn’t believe it was actually Moodle before they looked at the code. It was amazing.

After that, I started developing for Moodle, slowly going from developer to designer, project manager and account manager for several customers at some point. It was the perfect training for a consultancy business.

I took the company (the legal entity) from my father, renamed it and repurposed it. The real start of bdecent was January 2017, when I quit my job.

How does bdecent operate today? How many employees does it have?

I never wanted to grow big. I don’t have staff. My father takes care of strategy, financials, accounting and legal. I have an “advisor” who is actually a friend, he’s a professor who gives me a hand sometimes, especially if the project involves psychology and research. I am also a psychology lecturer.

It is very difficult to find someone who is well experienced both on a theoretical and practical point of view on a broad set of issues covered in my consultancy: UX, design, psychology, and instructional design and technology on the education side.

So I don’t try to grow. I do what I can and I love it. I do want to increase the visibility of my plugins, but other than some contract development work I’m not looking to scale up.

What are the most common problems that you witness in online learning? Which ones do you think you are better able to solve?

Put simply: Learners are less motivated to do online learning than employers.

I don’t believe that content is necessarily the problem. For me, the main problem is user motivation. Most of what people know about online learning involves training like compliance. That is, of course, boring. E-learning often has a bad reputation from a learner’s perspective. Students can feel ripped off if instead of talking to an expert and engage in a dialogue, all they get is some videos and quizzes.

So what I am trying to do is to “remove every barrier” between learner and content. That means, among other things, being as I like to say, “brutally efficient.” Compliance and most mandatory training in general is not meant to be sexy, but it can and should be as hassle-free as possible. That’s what my consultancy is all about. And for that you don’t need to develop a lot of new things.

If you are fluent in Moodle, you can create an effective and minimalist course in a relatively short amount of time. But sometimes Moodle demands a lot of work that is not necessarily efficient. That’s one field where I saw an opportunity, and thus created Video Time, one of my plugins. For almost 10 years, I have seen the opportunities of video-based learning. I’ve also seen how video companies continue to miss these opportunities, up to this day.

The Video Time plugin for Moodle

I chose Vimeo as video streaming provider in many projects. From my point of view it’s one of the most effective solutions out there, with almost unlimited capacity of streaming at an affordable rate. I try to make Vimeo integration a little easier in Moodle with the Video Time plugin. It is easy to embed a Vimeo video in Moodle, but just adding the embed code leaves you with a lot of questions unanswered. You wouldn’t know, for example, if students have actually seen a part or the whole video. There are other solutions for this, like SCORM. I just figured out it would be way easier to add a simple plugin with a basic completion requirement.

What is it like to be in the Moodle plugin business?

The plugins are self-sustaining financially. But I actually don’t need them to make a lot of money. I enjoy consulting more than development. I no longer work on the plugins myself but hire contract work. Consultancy is a lot more profitable than developing for Moodle for me. The Moodle user base is not one that will pay a lot of money for software in most cases. But since I have benefited so much from Moodle, I am more than happy to give something back and contribute with some plugins.

Right now, the products continue to fund their own development. There are new features and releases on the way, all financed by the revenues of the product. I make a little profit, but I invest as much as I can into their development.

How are you planning to promote and commercialize the Moodle plugins further?

The consultancy and the plugins cannot be seen separately.

From the consulting, I learned what are the pain points from learners and customers. I have been able to keep in direct contact with end users, for which I am very grateful. That has allowed me to see clearly what the problems are. From there I can figure out which problems I can solve, and prioritize them in plugin development.

I want to start marketing more actively once the initial set of plugins and features on my mind are released. I’m currently waiting for my latest plugin, the Kickstart Course Wizard, to be approved in the Plugins Directory. Then I will work on estimating an ROI: How many Euros I need to invest in order to get a given number of new subscriptions. Depending on it, I will decide how much I can invest in marketing. What I don’t want is to waste money on advertising instead of making the product better. I just need to be patient.

As of writing, the Kickstart Course Wizard is completed and waiting for approval into the official Moodle Plugin Directory.

The Open EdTech Startup scene

What insight or advice do you offer to new startups and solopreneurs looking to break into the EdTech field?

I’m not a typical example of getting my own business up and running.

I did have an instance of startup failure, some 15 years ago. My biggest problem back then was that I didn’t have a network. I didn’t have enough people who trusted me and wanted me because they knew me.

The last time around, when I decided to quit my day job, I reached out to my customers to let them know I would be leaving. Most of them asked what I would be doing next, and if I would still be available.

These referrals from my previous job are 100% of my business today. They don’t care where I am, they just want me. I’m in that great position where I don’t need to do any marketing.

I would summarize my advice in two points:

  • Network first. That takes time, and it would not be a good path for, say, a startup looking for a quick, big exit. But for me it was the right way.
  • Build your reputation next. Be it from your main job or as a side project, or even by engaging in a community (like Moodle). Be active, be patient, and work on proving your value.

Does that mean your current customers are more or less the same that you were serving in your previous job?

Not really. Customers back then referred me to new ones, and so on. Sometimes they don’t need me for a long term commitment, but it’s balanced out. I have clients mostly from Germany, but sell my plugins world wide: Canada, US, Australia, Taiwan, Brazil to name just a few.

Is your unique mix of skills an important factor in the success of your business?

Absolutely! I see myself as a mediator. Usually I am between the customer and the business. People connect to me, from users to CEOs or founders. I take care of all the aspects of a project: Cost, quality, efficiency in the development process, responsibility.

Then, since after all you are relying on a software product, it really helps to understand things and properly communicate them to a developer, so they can implement it. Not just as a matter of requirements met, but in an elegant and flexible way that makes sense for the specific system you are in. In other words, to make the solution “native.”

I would not call myself a developer, but I understand software development at a deeper level: On the architecture, the services they need to use, some of the technical terms. I can translate customer and learners requirements into their language and vice versa.

What are your personal thoughts on where the field of learning technologies is going?

Hard question. I would separate the answer into two.

On one hand, we can think of an ordinary company, large or SME. They have training and compliance needs and there is not much that can be done to turn it into “Edutainment.” This space could reasonably be affected directly by Virtual and Augmented Reality technologies, as well as AI and Machine Learning, at least in format. However, I don’t really expect them to radically improve on bottom-line efficiencies of the effectiveness of learning. That is, these will not affect the “brutally efficient” paradigm. All a system needs to do here is be respectful of the learner’s time.

AI only works if you have heaps of data and lots of content, as well as a team of highly sophisticated people who can look into it. Imagine an LMS of just a handful of students, and the majority of which has completed barely 2 courses. What is AI going to do there? In that case, the educator’s best bet is to just focus on making a sound learning experience.

On the other hand, I have been able to witness new developments and breakthroughs. In the German automotive industry, AR has significantly improved employee training. Imagine this: An expert wearing a cam discusses a practical topic as he performs the task. The students are all wearing VR headsets and can see in first person what the expert is doing. They watch as he performs the task.

In that  case there are advantages at scale. Thousands of people are trained every year in Germany alone. A company with a couple of million Euros to spend on training and a savvy EdTech team could reasonably invest and develop an effective AR\VR-intensive training program. I think something like this could really be successful and revolutionary. It also applies to AI, since you do have the data and the team to make it show results.

I love technology. I just don’t see a reason for learners to use it if it doesn’t do any good. VR, AR and AI are finding ground, but they are still not for the masses. Their place today is highly specialized industries with significant economies of scale. When it comes to AI, for example, you can’t just “buy and use.” It requires a whole environment and an understanding team.

This also applies to the way I approach EdTech consulting. Unlike other people, I do not have an incentive to introduce a technology into the project. This gives me a privilege. I can voice my opinion in case a technology doesn’t make sense, even if the customer is the one requesting it. If I don’t believe in something, I strongly argue against it. I focus on helping customers buy only what they need. So far, they have come back.

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