(Reuters) – Kajabi, an e-commerce platform that serves knowledge-based businesses, said on Tuesday it raised $550 million in its latest round of funding led by Tiger Global Management, which puts the company’s valuation at over $2 billion.
The mega round comes as the pandemic has given online businesses a boost and shown the potential growth of what some call the “knowledge economy” including business coaches, trainers, podcast and newsletter makers, and more.
Ample funding in the market has also brought an increasing number of mega deals, and Tiger Global has been leading or been involved in several, including audio social media Clubhouse, chip-maker Groq, and financial tech startup Brex.
Kajabi was co-founded in Irvine, California, over a decade ago by Kenny Rueter, who created a sprinkler toy with PVC pipes for his sons. It was an instant hit in the neighborhood. So he made a how-to video for it, but Rueter, a software engineer, wanted to sell the video instead of posting it for free on YouTube. When he realized there no easy solution, he started Kajabi.
Kajabi offers a subscription service to people who want to monetize their expertise, offering tools for creating websites, online classes, newsletters, podcasts and collecting payment from members.
Rueter said the latest funds are to help the company keep up with the “hyper-growth” it has experienced, and that acquisitions are possible.
Arun Agarwal, managing director of TPG, which participated in the latest round of investments, said it was hard to quantify the knowledge economy’s market size as it was growing fast with more people starting online how-to courses. He said it is becoming apparent “just how unbound the potential was, and frankly how early we are inning-wise and how under-penetrated that market is today.”
(Reporting by Jane Lanhee Lee in Oakland, Calif.; Edidting by Matthew Lewis)