November 10, 2008
Five year old textbook rental startup Chegg is really starting to ramp up sales, we’ve heard. The average college student, they say, spends $900 per year on textbooks. Chegg saves them 70-80% of that by renting them the books instead of selling them outright.
Here’s how it works: students find the books they want by searching by ISBN, author, title or keyword. The rental price for the semester or quarter is just 20-30% of the full retail price, and are delivered within eight business days. At the end of the term, the students receive a pre-paid shipping box to return them. Students are even allowed to highlight books (but no writing in them).
The company was founded in 2003 at Iowa State University as a classifieds site. In the fall of 2007 the company changed their business to textbook rentals.
Revenues have soared to a roughly $10 million run rate, we’ve heard from a source, who also says they’ve just closed a second round of financing from Kleiner Perkins - $15 million at a post money valuation of $60 million.
Chugg had previously raised $2.2 million from Gabriel Venture Partners and Maples Investments.
By Nick
Fox News SciTech