EdTech RoundUp - August 2022
Over a few months, India's EdTech sector has undergone significant change and evolution. It is recalibrating its operations to remain relevant and thriving in the post-pandemic period, where schools and educational institutions have opened and resumed activities in full force.
Many EdTech businesses are returning to the fundamentals and taking the big picture into account. They are striving to innovate for students and create a long-term sustainable business model in response to the shifting requirements of their customer base. Thus, August saw acquisitions, fundraising efforts, investments, and new appointments.
Let's look at some of the main EdTech industry highlights from August:
1. Acquisitions, Funding, Stock Pool Increments, and a New CEO for EdTech Unicorn upGrad
Last month was quite boisterous for EdTech unicorn upGrad. It started with the acquisition of Exampur, a Noida-based test prep platform for government jobs, on August 2 for an undisclosed sum.
Most content of Exampur in over 200 test preparation courses made for government positions is distributed via its 27+ YouTube channels. Through its online presence, it has developed a hybrid learning paradigm.
In light of the rising number of educated but unemployed candidates in India, founders want students to go above and beyond to comprehend the secret to passing such complex tests. And for that, they hope to establish Exampur as a household brand.
Later that week, upGrad received $210 million in funding from renowned investors and Family Offices. Along with current investors Temasek, IFC, and IIFL, this round included participation from ETS Global, Bodhi Tree, Singapore's Kaizen Management Advisors Pvt. Ltd, and Family Offices of Bharti Airtel, Ambuja Cements, ACC, and Lakshmi Mittal. The money has helped the company's valuation double to $2.25 billion.
Further, in the last week of August, according to the company's regulatory filings with the Ministry of Corporate Affairs, upGrad increased the number of shares in its employee stock option plan (ESOP) pool by 3,000,000.
The ESOP pool size has increased from 22,25,810 shares to 25,25,810 shares. The estimated value of upGrad's new options is ₹244 crores ($30 million), while the estimated value of its employee stock is ₹2,058 crores ($260 million).
At the end of the month, the unicorn hired Myleeta Aga Williams as its CEO - International to drive expansion throughout the APAC, EMEA, and US areas. Williams will oversee end-to-end international operations across geographies and develop product pipelines tailored to each region to deliver high-impact revenue and profitability. She has over 20 years of experience in global digital enterprises.
2. EdTech Startup Sunstone Raises $35 Million in a Funding Round
Higher education-focused EdTech startup Sunstone raised $35 million, or roughly ₹280 crores, in a fundraising round headed by WestBridge Capital. Alteria Capital also took part in the fundraising round.
The startup will utilize this funding to grow its new programs, with a particular focus on undergraduate technology programs, according to Co-Founder and CEO Ashish Munjal. The company has a presence in over 35 cities and around 40 institutions. Over the next two years, it plans to grow into 100 locations nationwide.
3. EdTech Unicorn PhysicsWallah Sees FY23 Revenue to Top ₹1,200 Crores
According to its Co-Founder and CEO, Alakh Pandey, India's newest EdTech unicorn PhysicsWallah anticipates its FY23 (2022-23) revenue to exceed ₹1,200 crores as the company continues to experience high demand for its courses, mainly its core online offerings.
He also mentioned that the startup's online course subscriptions increased around 2.5 times this year, and PhysicsWallah branched offline to expand rather than transition.
Moreover, PhysicsWallah is also branching into one-on-one doubt clearing through its dedicated technological platform, "Saarthi."
4. EdTech Brightchamps Acquires Live-Learning Platform Schola
In a $15 million cash and equity deal, EdTech firm Brightchamps acquired Singapore-based live learning platform, Schola. The platform is for children to improve their communication and English skills. With the acquisition, the corporation wants to increase its position in the K–12 education market.
Brightchamps is presently valued at $650 million. Illustrious investors like Premji Invest and Beenext support it. The company has raised roughly $63 million so far.
5. Motion Education to Invest ₹100 Crores in the EdTech Space
Motion Education, a Kota-based company that helps students study for the competitive exams JEE-Main, JEE-Advanced, and NEET, is investing ₹100 crores in the EdTech sector. The company is growing its workforce to support its expansion and has upped its pace in FY '23. It now aims to create 50 new study centers across India.
The company also wants to increase its portfolio by marking its presence in Dubai and Saudi Arabia, where it hopes to triple its student intakes to 35,000 in FY '23. The expansion will increase the number of study centers to over 100 for the current fiscal year, focusing on the Hindi-speaking region of north India.
Journey Ahead
Businesses that continue to meet their customers' needs stay in operation. Therefore, it's critical for EdTech companies to remain competitive and continually meet customer expectations. Customer retention and acquisition are crucial for every EdTech organization. Investments will therefore be concentrated on achieving this particular objective, whether it be through M&As, new market acquisitions, or product innovations. It is likely advantageous to collaborate with other organizations to provide their students with top-notch and global upskilling.