Startup CEO complains about having 2 million users but no money in bank account

Jeremy Walker, founder and CEO of Exercism , a free programming learning service, revealed on his official blog that Exercism does not have enough funds to continue operating, despite the fact that the service has reached 2 million users, with more than 1,200 new users signing up every day.

2M users but no money in the bank. Tough times 😔
https://exercism.org/blog/september-2024-restructure

According to Walker, Exercism sees more than 1,200 new users signing up every day and tens of thousands of people completing the challenges every day, but his bank account is so depleted that he can no longer afford to pay his employees' salaries.

Walker said he had negotiated with many funders and companies, but because Exercism serves a wide range of users rather than a specific narrow demographic, it did not meet the objectives of many funders and he was unable to obtain support.

At the time of writing, Exercism receives approximately $7,500 (approximately 1 million yen) in donations per month from approximately 800 monthly donors, which covers monthly server costs of $1,000 (approximately 145,000 yen) consisting of 12 ECS instances, monthly database costs of $2,000 (approximately 290,000 yen), file systems, cache servers, etc.

The only successful source of revenue has been from advertising on the site. Walker says that while advertising has potential, he doesn't see it as a sustainable strategy due to the effort of acquiring and managing advertisers, and his desire not to overload Exercism with ads. As a result, Walker believes that a non-profit business model doesn't work as a way to realize Exercism's potential.

In addition, due to the current circumstances, a key member has decided to resign due to salary payment issues. However, as he is a fan of Exercism, he plans to continue working as a volunteer senior maintainer.

Walker also revealed that he has restructured the repository management system and reorganized the repository and GitHub management team to continue running the project. In addition, he plans to launch a new educational product in 2025 and support Exercism with the revenue. Walker also said that he is considering earning additional revenue by releasing a basic version of Exercism Teams.

'The only real end-user model would be to make Exercism a paid, up-front service, which is clearly contrary to our mission and does not respect the commitments people have made,' Walker said on the social news site HackerNews . 'While Exercism has not been financially successful over the past 18 months, it has fulfilled a core part of its mission by helping hundreds of thousands of people. Our goal is to get people to learn a programming language and then get on with their lives. We're not actively trying to monetize people.'

'We're not actually part of the programming industry. For 10 years, people have been learning new programming languages on Exercism. We've deliberately never wanted to be a competitive or recruiting platform. We've always been focused on helping people learn based on their innate motivations,' Walker said.