Friday, August 29, 2008

Lumina leaps into online college test prep space

By Christopher Calnan

The tutoring and standardized test-preparation market is still dominated by the established chalk-and-talk businesses. But local entrepreneurs are increasingly chipping away at the market with web-based applications taking advantage of the stiffer competition for colleges.

In December, twin brothers Edward and Mark Alfano are scheduled to publicly launch one of the newest entries into the space, Cambridge-based Lumina Prep LLC, converting what they learned through a conventional college prep-test tutoring service into an online business.

Lumina Prep started in November 2007 after the Alfano brothers decided to develop software designed to re-create and automate the tutoring service that Mark had been providing for up to $300 an hour. Using their own capital, the two hired a programmer who developed the application that was tested by 10 users in May and is now being licensed to Ivy Bound Test Prep, a New Britain, Conn.-based company.

Edward Alfano, who is also an associate at Cambridge-based Extera Partners, said accessibility to the web coupled with the greater competition for colleges is fueling the demand for online test preparation products.
“The time is really ripe for a service like this,” he said. “We’re riding that wave.”

The newest crop of college applicants are baby boomer offspring, also called “echo boomers,” who were born between 1980 and 1995. The sudden demand they’ve created has increased competition for colleges and expanded the market for test preparation courses.

But Lumina Prep is just the newest player in the market. In June, North Andover-based Omnisharp Inc. completed an eight-month beta test of its Socrato.com test-prep website with 2,500 students. In February, Cambridge-based uProdigy Inc., which provides tutors in South Asia to students via chat and voice-over-Internet-protocol, won its track in MIT’s $100K Executive Summary Contest. It also provided its product to students at Boston Latin Academy in Dorchester for the school year.

Lingro Inc., an Internet-based language training company, was launched in Worcester last year. Stoughton-based GlobaLinguist Inc., which was founded in 2003, and Cambridge-based My Happy Planet Inc., which launched in January, also provide language-learning products via the Internet.

In 2005, Boston online learning company Acadient Inc. launched Boston Test Prep, which developed a digital-audio SAT prep course. That year, the test-prep business generated more than $4 billion. Spending on private online tutoring totaled $115 million during the 2005-2006 school year, according to Eduventures Inc., a Boston-based market research firm.

Test preparation stalwarts The Princeton Review Inc. and Kaplan Inc. still own about 50 percent of the market, said Karan Goel, CEO of Chicago-based PrepMe Inc., which launched in 2005. But online tests are more affordable and more frequently being used by mainstream students rather than just those seeking elite colleges, he said.

At OmniSharp, CEO Raju Gupta said today’s students are readily adopting online test-prep tools — which may be an indicator of its future market. “Students are figuring it out on their own and telling teachers how to use it,” he said.