Due Diligence Gut Check
I am in the process of evaluating a SaaS business for potential acquisition. I'll have to keep a few details vague, but I suspect the community may have some sage advice regarding a few critical concerns.
The business is in the education niche; the product is essentially a digital curriculum.
While they have moderate instrumentation and measurement of the sales funnel, they have very little to track actual usage and engagement with the curriculum. The one exception is that they have timestamped records of students marking completion of lessons. I'd love to have more insight, but that appears to be the primary engagement metric available. (Note, that I'm also requesting some raw weblogs from which I can probably make additional measurements, but for now my question pertains to this lesson completion metric.)
While I totally understand that any SaaS will have a portion of its user base who are essentially zombie subscriptions. They no longer actively use the platform, but just haven't gotten around to canceling OR they have good intentions to resume using the service.
My question is this... What rate of engagement would be considered healthy for this kind of business? 50%? 20%? In my mind, lesson completion indicates members who are using the curriculum as designed. I'm leery of making assumptions about growth potential if too many users are not actively using the site. I am not all that excited about trying to build up what may be similar to a gym membership business model where the majority of the paying customers under-utilize the service.
Zombie subscriptions are very common, especially if the prices are low.
I sell education memberships (though not courses per se) and have seen a number of zombie subs. Sometimes I reach out and they apologetically tell me they plan to set some time aside soon!
I've also bought a lot of courses over the years and have only completed Laura Roeder's, 30x500 and a few very specific technical ones.
I've never even heard of any MOOC ever with a completion rate of even close to 20%. Your numbers sound great.
I appreciate your insight. I should clarify that the lesson completion rate I'm referring to is not completion of several lessons. My metric is something like this... "How many unique members read/watch a single lesson and by their own admission mark the 'homework' as complete." The homework assignment is offline, so those bothering to come back and mark it complete buy into using the platform to track progress through the larger course. I'm not aware of anyone who has completed all 500 lessons in the entire course... although because the lessons span many age ranges that was never the design.