In this EdTechX Stories episode, Ahad Khan, CEO of Kajabi talks to Benjamin Vedrenne-Cloquet about his interest in the knowledge economy and how this led him to take on his role at the head of Knowledge commerce platform, Kajabi. He explains the company’s business model and the economic profile of the entrepreneurs who use the platform to create, build and scale educational businesses around online courses on anything from beekeeping to taking care of babies or learning the Scottish drums. Learn more about Ahad’s beliefs and perspectives on the knowledge economy, as well as his vision for the future.

Watch their conversation below and stay tuned for future EdTechX Stories to be released very soon! 

 Transcript

Note: EdTechX Stories are produced as video podcasts and are designed to be watched and heard. The following is a transcription of the audio recording generated using a combination of speech recognition software and human transcribers which, in some cases, may be incomplete or inaccurate. Please check the corresponding video audio before quoting in print.

Welcome to EdTechX stories
Short weekly interactions with CEOs, founders, investors, and innovators, shaping and making the future of education and work.

Benjamin Vedrenne-Cloquet in Conversation with Ahad Khan

Ahad Khan Hi. My name is Ahad Khan. I'm the CEO of Kajabi, the leading knowledge commerce platform. I'm born and raised in Ohio, so I'm from Northeast Ohio outside of Cleveland. I now live in Southern California, where I lead a fantastic team of 300 employees trying to make our heroes the most successful knowledge entrepreneurs in the world.

Benjamin Vedrenne-Cloquet Ahad, welcome to EdtechX Stories. Before we talk about your business, let me start with a personal question. How did you end up in that position? Is there a defining someone or defining moment in your life or education that brought you to lead Kajabi and get involved in the creators economy?

Ahad Khan Yeah, I think at a personal level, I always wanted to be involved with companies that are empowering entrepreneurs to build and scale their businesses, right? If you look at my history, I've always kind of been more interested in B to C companies, B to SMB, B to prosumer businesses where you're giving people tools and services that kind of reduce the administrative burden of running a business and give them more time to focus on building content or scaling their enterprise. And so when I heard about Kajabi, played very well within that type of, I guess, approach I had to my career, which is I always wanted to be in touch with people. So I like the fact that our customers are individuals trying to build businesses. I like the way that that keeps you close to the people who are actually doing the work. And then education or kind of what we do is knowledge commerce. I just think this is such a fascinating part of the economy that I think is going to continue to be growing and growing, becoming bigger and bigger over time. And that confluence of events got me really excited by joining Kajabi, which I've been at for almost three years now.

Benjamin Vedrenne-Cloquet Okay, and Kajabi's Tagline is 'Turn your knowledge into income', right? So can you tell us what is it about Kajabi's model that makes it unique? And what is the typical profile of Kajabi creators? How much money they make on the platform? Can you tell us a little bit more about the platform?

Ahad Khan Yeah, absolutely. So from the economy of Kajabi, we've been around since 2010 and powered over $4.1 billion in GMV to our heroes, right? Heroes are our customers. When you kind of break that down, on average, in any year, a Kajabi creator or Kajabi entrepreneur makes about $30,000 a year on average, right? Which is unbelievable in the creator economy. If you think about the creator economy, it really is feast or famine. The way it's done on other platforms, meaning the top 0.001% make all the money. Well, here at Kajabi, the average creator is making $30,000. So it's a very different type of economic profile. And when you think about the type of things that people kind of do on Kajabi, it's sharing knowledge, experience, and expertise with a commercial lens to it, right?

So we have people who are teaching people how to play the guitar or how to learn beekeeping or how to pass a trucking exam, or how to take care of babies. It's truly fragmented in the most beautiful way. But what the platform enables them to do is kind of create, build, manage, and scale their business however they want, right? So we have knowledge products, which is the core of our business, online courses, coaching, membership sites, podcasts. And we're continuing to build other knowledge products over time, which is the main mechanism for our entrepreneurs to kind of transfer their information from themselves to their audiences. But we also have the tools to build a business around it. So you think about website creation, you think about a CRM or audience building, like, how do I interact with my customer base? You think about payments and affiliate programs and all the things these entrepreneurs kind of need to be able to build and scale their businesses. We are kind of the go to resource for knowledge entrepreneurs to do that. And it's something we've been taking very seriously since our founding in 2010.

Benjamin Vedrenne-Cloquet And how do you make money? You take, obviously, fees from your entrepreneurs. Do you do revenue share as well? All of those?

Ahad Khan No, it's very different and I think distinct, which is we believe in having a very honest transaction with our customers. So we do take a subscription fee. But outside of that, all the revenue that is powered, that $4.1 billion of GMB that we've powered to our customers, almost $2 billion on an annual basis, now that we've scaled, all that revenue goes straight into our customers' pocket. So we are not taking a take rate on that. Our business model is very different and distinct, and I think that becomes especially interesting to entrepreneurs as they scale and scale. When you're starting out, taking a 10% cut of your revenue is not the biggest deal. When you have $10,000 flowing through your business, that's a lot of money. And so we want to align directly behind the creator, behind the entrepreneur to make sure that if you make a dollar on Kajabi or you make a million dollars on Kajabi, you keep all of it. All you're doing for us is paying us a subscription fee. And our job and our reason of existing is to give you the tools and services to make you as successful as possible so you can control your economy and have all those dollars flow just to you.

Benjamin Vedrenne-Cloquet So give me examples of the most interesting businesses you've seen on Kajabi.

Ahad Khan Great question. Yeah. We have a company, Honey Flow, which is, I think, out of Australia. They teach people how to become beekeepers, right? And it's one of those things where during the pandemic, people had a lot of time on their hands, and they were just like, I'm going to learn how to become a beekeeper. And this company has been doing this for a while on Kajabi, and it's just like tremendous success. And we try not to share our customers' revenue because it's their revenue, but they're doing very well. Another example is a company called Taking Care of Babies. I have a nine month old daughter, and what taking care of babies is, she's an ex neonatal nurse, and she teaches parents how to kind of, like, interact and raise their children at different segments of infancy. So zero to two months. Two to four months. Four to six months. She has courses that you kind of take along the way that help with sleep training, feeding, all the little nuances of being a parent. And that is enabled by Kajabi because that's really what we love about that is there's knowledge commerce behind it. She has experience, expertise and knowledge that she's able to share with a huge, I mean, frankly, the world, because her business is online. And so those are just two quick examples of the kind of businesses that are built on Kajabi.

Benjamin Vedrenne-Cloquet And what are the quirkiest businesses that you've seen? Things you've seen, say, well, I would never have thought that it would work. I mean, I'm sure there are some, right?

Ahad Khan For sure. Quirkiest as in the coolest way, right? So we have, I think we have a knowledge creator or entrepreneur who teaches people how to play Scottish drums, right? And they do quite well on the platform. And I was like, this is very interesting, right? Like you don't think of Scottish Dumbs as being some huge business opportunity. And, like, not everything has to be a huge business opportunity, right? This is enough for people to make a very strong living. But I saw that, and I was like, this is actually a very cool, seemingly niche thing, but they're able to build a very nice business around it. And the cool thing about that you're also enabling their passion. Right? Like somebody's teaching Scottish drums because they love it, right? And that's a very cool journey to be a part of.

Benjamin Vedrenne-Cloquet And explain to me how do you further expand the opportunities for creators? I'm sure they all go into your platform because they have a strong interest, a desire to generate some income. But they might not think of it as a global business opportunity. And I'm interested in how you basically make them grow on this.

Ahad Khan Yeah, I mean, what we try to do is we want to arm them with all the knowledge and services and, frankly, products that can help them build their businesses. So you think about Kajabi's history. We really started in online courses, right? And that's kind of our bread and butter. We have a fantastic online course business, but we've over the last two years, we've released podcasting, we've released coaching, we have upgraded our live video capabilities, we've upgraded our membership sites. We have other knowledge products coming down the pipe. And when we think about helping our entrepreneurs kind of scale their businesses, we want them to be like, hey, you teach people how to bee keep. You should do a podcast, right? And you should do a paid podcast which provides you an ability to actually monetize that versus giving it away for free. Because again, we have a good commercial lens on the type of things that we do. We want to empower our creators and our entrepreneurs to make money. And a lot of them are in the business of building a business, right? And so the things that we do on their behalf, we're trying to give them more opportunities to provide value to their audiences. In exchange for that value, they're able to build and scale businesses that aren't just based off of what may have been historically courses, but they can add these other products around it that really help them scale.

Benjamin Vedrenne-Cloquet What is, for you, the future of the company? What is Kajabi 2030?

Ahad Khan I think, honestly, first, it kind of starts with what are our customers doing, feeling and needing, right? And so we think about our journey that we're growing along with them, right? So as they build and scale, they come to us like, hey, I would love to have X, I'd love to have Y, and I'd love to have Z. So that helps kind of guide the way we think about building the business. I think about in 2030, I think Kajabi continues to be the go to resource for knowledge entrepreneurs to build and scale their businesses, right? What that means is that environment could be drastically different, right? It could be right partnerships with the right platforms. It could be different knowledge products we're able to build on top of us. It could be how are we helping provide more analytics to our entrepreneurs that becomes like this really good feedback loop that helps them guide them more explicitly in terms of how to build the best business. So when I think about the 10-15 year kind of horizon of the business, I think at its core, it's listening to our customers and building on their behalf, but continue to be this kind of go-to resource for knowledge entrepreneurs. That's the way we think about the future.

Benjamin Vedrenne-Cloquet Ahad, I imagine you are a lifelong learner.?

Ahad Khan Yeah.

Benjamin Vedrenne-Cloquet What are you learning right now? Currently?

Ahad Khan Yeah. No, I mean, it's ironic because I think you're maybe originally French, but I take French lessons kind of multiple times a week on my own independently. And that's a function of my upbringing. I took in high school, they kind of make you take a foreign language and I was always interested in French. In college, I didn't get to really stretch that itch enough. So as I've gotten older, I spent a lot of time in languages. And the reason I love that is because it opens up new worlds and communities for you. Right? So I try and travel not just to France, but to places that are French speaking and work on my own linguistic skills, but also learn about those local cultures. So that's a big part of my life. And the other part is, you know what? A lot of books, and it's not always business books, a lot of history books or economic history, trying to understand why things are the way they are. So if I were to argue, those are the two places where I usually spend most of my time.

Benjamin Vedrenne-Cloquet Okay, I'll send you a book in French then. Ticking those two boxes. And I guess learning French is a lifelong commitment, but you're probably future proof after that. We're going to get into the one of the funniest sections, I think, of the interview, which is the rapid fire section. So I'll ask you a question you have to answer by A or B. Are you ready?

Ahad Khan Perfect. Let's go.

Benjamin Vedrenne-Cloquet Degree or skills?

Ahad Khan Skills.

Benjamin Vedrenne-Cloquet Tech or creativity?

Ahad Khan Creativity.

Benjamin Vedrenne-Cloquet Remote work or everyday in the office?

Ahad Khan Remote work, though I believe in a hybrid, but remote work.

Benjamin Vedrenne-Cloquet State school or private school?

Ahad Khan State school. I think it depends on the child. But state school.

Benjamin Vedrenne-Cloquet Okay. Profit or impact?

Ahad Khan I think impact because profit follows impact sometimes. So if I choose between two, I'd say impact.

Benjamin Vedrenne-Cloquet Creators or shareholders?

Ahad Khan I think creators, for sure.

Benjamin Vedrenne-Cloquet Okay. And teacher or technology?

Ahad Khan Teacher.

Benjamin Vedrenne-Cloquet Okay. Thank you. Now, if you had one prediction for the future of the creator economy or the knowledge economy, what would it be?

Ahad Khan I think it's going to be, honestly... We felt this a little bit in COVID where the world kind of came at us because everybody was kind of in there. I think of digital commerce and the creator economy, I think are just set up for profound growth over the coming 5.10, 20 years. Right? The digitalization of goods and services I think is a trend you're not going to stop. And so when I think about the prediction, it's not that bold, but I think it's true. It's growth and opportunity.

Benjamin Vedrenne-Cloquet Do you believe in the metaverse?

Ahad Khan In some circumstances, I do. I don't think it's going to be all encompassing. Frankly, I think it's going to be limited and scope to some degree. But I think there's so much you can accomplish if that goes right. And I think even educationally, we think about that quite a bit as well. By definition, it's a very immersive technology which enables you to connect with people from all over the world on a platform. That's very appealing. I don't think it's, again, all encompassing, but I believe in aspects of it for sure, particularly amongst education. Absolutely.

Benjamin Vedrenne-Cloquet Okay. Now a final question for you. If you were to nominate the next interviewee for EdTechX Stories, who would that be and why?

Ahad Khan I think of two people that I would do. First, there's an investor, the founder of Learn Capital, a person by the name of Rob Huddard. I think he's made amazing investments. More importantly, been around this sector for 15, 20 years and has a very good point of view in terms of where this market has been, where it is currently, and where it's going. And I think it's not just a US domestic point of view, but it's a very global point of view. You can tell by his portfolio of companies. They're kind of all over the place doing this in a different way, which I find fascinating. And the other person would be a person by the name of John Connelly, who leads EdTech investments at Spectrum Equity Investors, which is an investor in Kajabi. I think he'll give you a great insight into kind of the growth part of the world. So you think of Rob as more of the venture side. The growth equity side of it, I think John can give you great insights into because Kajabi teachers pay teachers. A lot of his portfolio companies are at the leading edge of what's happening in EdTech. And I think those two conversations would be fantastic.

Ahad Khan And if I were to add a third, I would add Sal Khan, who is a good friend of mine. He's the founder of Khan Academy. And I think hopefully everybody kind of knows what he does. But he's been doing this for... I knew him before he started it, so it's been amazing to see what he's built over time. And he obviously has a very strong opinion in terms of what's happening in education, period.

Benjamin Vedrenne-Cloquet We'll reach out to them. You have the same last name, so are you related? No.

Ahad Khan No, Khan is... The best way to describe Khan is like the Smith of South Asia.

Benjamin Vedrenne-Cloquet Or the Dupont of France.

Ahad Khan Yeah, exactly.

Benjamin Vedrenne-Cloquet Very good. Well, this was Ahad Khan for EdTechX Stories. Ahad, thank you very much. It was a pleasure. I really enjoyed that. Thank you.

Ahad Khan Thank you so much for having me. I really do appreciate it. Talk to you soon.