Edtech gold rush goes on: Unacademy raises $440 mn

Education technology company Unacademy on Monday said that it has raised $440 million in a Series H funding round led by Singapore’s state-owned investment company Temasek. General Atlantic, Tiger Global, Softbank Vision Fund, and Mirae Asset also participated in the latest funding round that valued the Bengaluru-based edtech major at $3.44 billion.

Aroa Ventures, the family office of Ritesh Agarwal, founder, OYO and Deepinder Goyal, co-founder and CEO, Zomato have also participated in the funding round, the company said in a statement, adding that the valuation of the edtech firm has jumped nearly 10x in the last 18 months.

Last year in September, when Unacademy raised $150 million in a funding round led by Japan’s SoftBank, the investment valued Unacademy at $1.45 billion, making it the second edtech company after Byju’s to be part of India’s unicorn club—which are basically privately-held companies that have reached a valuation of $1 billion, or more.

Unacademy plans to utilise the funds in ramping up its new lines of business and existing services. In a Twitter post on Monday morning, Gaurav Munjal, co-founder and CEO, Unacademy said, “There are three major products that we will build and scale (or continue scaling): Unacademy: helping people crack life-changing exams, Relevel: giving people a path to get their dream job irrespective of their educational background and Graphy: empowering creators to build their online businesses to sell digital goods including NFTs.”

Despite the Covid-19 pandemic disrupting businesses across sectors, edtech companies in India have been ruling the roost in raising funds from global investors since early last year. Edtech was the most funded space in 2020. According to the EY-IVCA India Trend Book 2021 report, last year, India’s edtech companies raised over $2.2 billion in funding with Bengaluru-based Byju’s alone accounting for $1.4 billion in funds raised. The pandemic has accelerated the growth of the edtech sector in India and the market size is estimated to grow 3.7x in the next five years, from $2.8 billion in 2020 to $10.4 billion by 2025, the report notes.

The company points out that the latest funding round follows one in January this year when Tiger Global, Dragoneer Investment Group, Steadview Capital, and General Atlantic doubled down on their earlier investments through a secondary transaction.

Talking about the funding, Munjal posted on Twitter that “With funding comes responsibility: to build and scale iconic products of the future…to constantly innovate and experiment…create value for our shareholders…to not mis-sell in an industry which is known for its bad sales tactics.”

Unacademy was launched as a YouTube channel in 2010 when Munjal, then an engineering student, started uploading tutorials. Soon, he asked his friend Roman Saini, an MBBS from AIIMS who had cracked the civil services, to upload tutorials for IAS aspirants. Hemesh Singh joined some days later as the CTO of the online education platform, which brings together educators and students.

Today, the online learning platform has a network of over 50,000 registered educators and more than 62 million students. It provides services in 14 Indian languages to students across 5,000 cities.

Last month, Unacademy acquired Rheo TV, a live game streaming platform that aims to make professional game streaming a mainstream career for an undisclosed amount. Rheo TV helps professional game streamers livestream their gameplays and monetise those feeds. The platform claims to have more than 5 million users and over 10,000 live streamers.

Armed with tailored strategies, along with deep pockets, companies such as Byju’s and Unacademy are fighting to occupy a larger chunk of the edtech space. And now with funding available across various stages of growth, only time will tell if this momentum can be sustained.