Chegg, once hailed as a Silicon Valley disruptor democratizing access to education, has undergone a profound and troubling transformation since its founding in 2005. What began as a textbook rental company evolved into a billion-dollar homework help empire—an empire that, critics argue, has done more to undermine academic integrity than to foster genuine learning. Its business model capitalized on the structural weaknesses of American higher education and, in the process, normalized a shadow system of paid cheating.
Origins: Textbooks, Student Debt, and Disruption
Chegg was born at the intersection of inflated textbook costs and the neoliberal university. Founders Osman Rashid and Aayush Phumbhra sought to bring the efficiencies of the sharing economy to the campus bookstore. In its early years, Chegg attracted investor attention by promising cheaper textbook rentals—a modest but important service in an era of spiraling student debt.
But as textbook rentals became commodified, Chegg pivoted. By the early 2010s, it was building a suite of digital services: step-by-step solutions, tutoring, and subscription-based homework help under its Chegg Study brand. When Chegg went public in 2013, it promoted itself not just as a tech company, but as a partner in “student success.” In reality, it had found a way to turn student desperation into a profitable SaaS model.
Homework Help or Cheating-as-a-Service?
Chegg’s transformation into a homework help platform would eventually earn it a darker moniker: “Cheating-as-a-Service.”
Nowhere is this critique more powerfully detailed than in education journalist Derek Newton’s Cheat Sheet, a Substack project dedicated to exposing the industrial-scale cheating facilitated by platforms like Chegg, Course Hero, and Studypool. Newton, who has tracked the issue since 2019, documented case after case in which students used Chegg not to learn—but to submit answers for graded assignments and exams. Faculty across disciplines and institutions began reporting widespread cheating enabled by Chegg, especially during the remote learning surge triggered by COVID-19.
In one issue of Cheat Sheet, Newton wrote:
“Chegg isn’t an education company. It’s a cheating company. It monetizes academic dishonesty, obfuscates accountability, and deflects responsibility while raking in millions in subscription revenue.”
According to Newton, Chegg’s "ask an expert" function—where students submit specific questions and receive solutions within minutes—became a tool of choice for real-time cheating during online exams. Despite university honor codes, many students saw Chegg as a normalized part of academic life. Meanwhile, Chegg’s refusal to proactively block cheating or cooperate fully with universities left institutions scrambling.
Pandemic Profits and Ethical Collapse
During the COVID-19 pandemic, as universities shifted online, Chegg’s subscriber base soared. Students confined to Zoom classrooms flocked to digital platforms for support—or shortcuts. By 2021, Chegg had nearly 7 million subscribers and posted annual revenues of $776 million. Its stock price peaked above $100 in February 2021.
But that growth came with growing backlash. Professors and academic integrity officers called for investigations. Some universities demanded IP logs and timestamps from Chegg in academic misconduct cases. In response, Chegg adopted a policy of releasing user data only under subpoena—shifting the burden to faculty and administrators.
Chegg, for its part, insisted it was simply offering "study support" and denied facilitating cheating. But the evidence presented in Newton’s Cheat Sheet and other academic publications told a different story.
Collapse, AI Disruption, and Image Repair
In 2023, a new threat emerged: OpenAI’s ChatGPT. Free, flexible, and fast, ChatGPT began to supplant Chegg for the same user base. In a rare moment of corporate honesty, Chegg CEO Dan Rosensweig told investors that ChatGPT was impacting the company’s subscriber growth. Wall Street panicked. Chegg’s stock plummeted, its valuation shrank, and the company began rounds of layoffs—first 4% of its workforce, then 23% in 2024.
Desperate to stay relevant, Chegg pivoted again—this time toward “CheggMate,” its proprietary AI chatbot built in partnership with OpenAI. Yet the damage to its brand, and its future, was already apparent.
By 2025, Chegg was struggling to define its purpose in a rapidly changing education tech landscape. Its subscription model had been undermined by free AI. Its name remained tainted by years of academic dishonesty. And efforts to shift into AI tutoring raised further concerns about data privacy, surveillance, and automation in learning.
A Mirror of Higher Education’s Failures
Chegg’s rise and fall cannot be understood in isolation. It thrived in a system where students are overburdened, instructors are underpaid, and administrators look the other way as long as graduation rates and tuition dollars remain stable. Its gig-based backend—where underpaid "experts" supply answers for a global audience—mirrors the adjunctification of academic labor itself.
Derek Newton’s Cheat Sheet and other critical reporting have exposed how edtech platforms exploit the credibility crisis in higher education. The real scandal isn’t just that Chegg exists—it’s that the ecosystem made it necessary.
Conclusion
Chegg’s legacy may one day be viewed not as a revolution in learning, but as a symptom of higher education’s marketized decline. Like diploma mills and for-profit colleges before it, Chegg served the needs of students abandoned by the system—but did so at the cost of academic trust and intellectual growth.
As the AI era unfolds, and companies like Chegg scramble to reposition themselves, the Higher Education Inquirer will continue to ask: who profits, who pays, and who is left behind?
Sources
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Derek Newton, Cheat Sheet newsletter: https://cheatsheet.substack.com
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Chegg Inc. 10-K and Investor Calls (2015–2025)
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The Chronicle of Higher Education, “Is Chegg Helping or Hurting?”
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Inside Higher Ed, “Chegg, ChatGPT, and the New Arms Race in EdTech”
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Bloomberg, “Chegg Warns of ChatGPT Threat”
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Reddit threads: r/Professors, r/College, r/AcademicIntegrity
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The Markup, “Chegg’s Gig-Economy Model and Academic Labor”
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The Atlantic, “The Cheating Economy”
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Higher Education Inquirer Archives on EdTech and Academic Integrity
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