A report by Google and KPMG pegs the Indian edtech space to grow from $ 0.25 Bn to $1.96 Bn and online education to witness 8x growth over the next five years.
Investor interest in ed-tech peaked in 2016, with startups securing a total deal value of $269 million for the year, data by VCCEdge, the research platform of News Corp VCCircle, show. This marked a significant increase from 2015, which saw $178 million worth investment flowing into the sector. However, the deal value witnessed a drop in 2017, with investors putting in a total of $162 million in ed-tech firms.
With a focus on segments like skill training, research and increased focus towards a digital economy, Finance Minister Arun Jaitley’s Union Budget 2018 has come up with loads of hopes and opportunities for the edtech startups community in India.
As per Inc42 Datalabs, the low funding in edtech domain is mainly due to lack of reach in the semi-urban, rural and remote areas. Unlike the Tier I folks, who are well acquainted with modern technologies like e-learning, etc. the rest of India is still largely reliant on tuitions and private educations.
There are several ed-tech companies which have taught us a good funding lesson.
Byju’s (USD 30 million)
Education technology start-up, Byju’s (Think and Learn Pvt. Ltd) has raised about $30 million from Brussels-based family office Verlinvest, in a move that will give the company significant firepower to expand business. To be sure, Byju’s has been one of the few growth stage start-ups to have raised multiple rounds of funds in 2016.
Byju’s business model has undergone a significant change in the last one year, from a classroom-based model to an app-based one. Ravindran claimed in the interview that Byju’s app had more than 5.5 million downloads in the 12 months to September 2016, of which 250,000 consumers were paid annual subscribers.
As per data platform Tofler.in, Byju’s clocked revenue of Rs110 crore in the year ended 31 March, 2016, with a net loss of Rs50 crore.
Cuemath (USD 15 million)
Math learning startup Cuemath has raised USD 15 million in its Series B round of funding from CapitalG and Sequoia India. CapitalG (formerly known as Google Capital), the growth equity investment fund of Alphabet (Google's parent company), led this round of funding.
Cuemath is an after-school math excellence program for children in KG to grade 8 and is offered through home-based centres which are managed and run by trained and certified Cuemath Teachers. Founded in 2013, Cuemath now has over 2,000 centres educating more than 10,000 students across the country. Stating that by March 2018, it aims to establish 5,000 centres and enrol 40,000 children in the program, Cuemath said the funds raised will be utilised towards making the learning system more powerful and expanding to more cities across the country.
Cuemath had earlier raised USD 4.1 million in its Series A round of funding from Sequoia India in February 2015.
Unacademy (USD 4.5 million)
Online learning platform Unacademy today said it has raised USD 11.5 million (about Rs 73.61 crore) in a funding round led by Sequoia India and SAIF Partners. Existing investors and angels, including Nexus Venture Partners and Blume Ventures, also participated in the Series B round, Unacademy said in a statement.
Unacademy was founded in 2010 by ex-Flatchat senior executive Gaurav Munjal and former IAS officer Roman Saini who resigned from the government service to start a business.
“Our vision is to build the world’s largest online knowledge repository. The company will also significantly invest in producing its own knowledge-based content with its top educators on the platform.
Toppr (USD 7 million)
Mumbai-based online test preparation service Toppr has raised Rs 45 crore in its second round of Series B funding, led by its existing investors SAIF Partners, Helion Ventures and FIL Capital Management.
The company will use the capital to expand the geographical footprint and accelerate user acquisition. The company expects this capital to take the company to full profitability. The company is also looking to reach out to students across the country, aiming USD 500 million in revenue by 2021.
The online learning platform has already equipped its 2 million users with the efficacy of personalised learning. In the K–12 space, Toppr has radically transformed how students prepare for all board and competitive examinations.
The government is still the largest player in the ed-tech sector, and entrepreneurs have a plethora of opportunities such as addressing the skill gap between education and industry, developing language, quantitative, and programming skills, and offering niche platforms to help teachers or lawyers.