Byju’s Is India’s First EdTech Unicorn

According to IBEF, the education market in India is estimated at $91.7 billion and is expected to cross $100 billion by 2019. India has more than 1.5 million schools with over 260 million enrolled students. It also has a vibrant tutoring industry. The e-learning sector is expected to reach US$ 1.96 billion by 2021 with around 9.5 million users. Indian Byju’s learning app from Think and Learn Pvt Ltd has recently entered the Billion Dollar Unicorn Club.

Byju’s’ Journey

Think and Learn Pvt Ltd or better known as Byju’s was founded in 2011 by Byju Raveendran in Bangalore. Around 2007, Byju helped some of his friends prepare for the Common Admission Test (CAT), which is the entrance test for India’s best management institutes. He then started conducting CAT preparation workshops on weekends. From a classroom of 40 students, he was soon booking auditoriums for 1,200 students. Soon, Byju replicated this successful model to eight other cities including Chennai, Mumbai, and Pune.

By 2009, some of his best students joined him to scale up the content and the business. In 2011, Byju’s was founded and it started offering the sessions through the video format. In 2014, it launched a tablet learning program for competitive exams and grades 8-12.

In 2015, it launched the Byju’s learning app and within three months, over 2 million children were using it. Byju’s creates personalized learning programs for students based on their proficiency levels and capabilities. It generates slick, high quality videos for the K 12 segment that are developed by over 500 people in the Research and Development team.

Today, Byju’s offers learning programs for class 4-12 and test preparation for competitive exams like JEE, AIPMT, CAT, IAS, GRE, and GMAT. It has over 15 million users, 900,000 annual paying subscribers, and a 90% renewal rate.

Byju’s’ Financials

Byju’s follows a freemium model. The price for the program for each class starts from Rs 23,000 ($360). The price for competitive exams can vary from Rs 15,000 ($235) to Rs 70,000 ($1,000). The K 12 vertical accounts for about 90% of the total revenue.

Byju’s recorded revenue of about Rs 247 crore ($36 million) in 2017, up 125% from Rs 110 crore ($16 million). Its team size has grown to 2,300. Net loss grew by 19% to $8.7 million (INR 59 Crore) from $7.2 million (INR 50 crore) a year ago.

It expects to achieve annual profitability by 2020 and claims to have been profitable in the April quarter. It expects revenue to grow 100% to INR 520 crore ($72 million) in 2018 and close to INR 1200 -1300 crore ($180 million) in 2019.

Byju’s has raised over $244 million in funding so far from investors including Sequoia Capital, Chan Zuckerberg Initiative, Sofina, Tencent Holdings, IFC Venture Capital Group, Aarin Capital, Lightspeed Venture Partners, Times Internet, and Verlinvest. Its last funding was in August 2017 when it had raised about $40 million at a valuation of an estimated $1.2 billion. It is in talks to raise another round for $300 million at a valuation of over $2 billion.

The company says about 15% of its students already come from outside India and it plans to use the funds to expand its footprint internationally. Byju’s is now looking to expand to the Middle East, the US, the UK, South Africa, and other African and Commonwealth markets. Along with English, it plans to develop its products in regional languages as well. It plans to acquire US-based gaming and learning startups targeting lower grades.

In July 2017, Byju’s acquired TutorVista and Edurite from Pearson to expand its international reach and create a diverse product portfolio. It acquired career guidance and academic profile builder Vidyartha in January 2017.  In July this year, Byju’s acquired Bengaluru-based math learning startup Math Adventures for an undisclosed amount.

Competition is stiff for BYJU’s. Private coaching institutes are numerous in every Indian city apart from local, home tutors. Some of the leading private coaching institutes are Delhi-based Aakash Tutorials and Kota-based Bansal Classes. Apart from these, its EdTech competitors include iEmbibe, Toppr, Avagmah, iProf, Meritnation, Simplilearn, and California-based Khan Academy.

It will be interesting to know from the users as to what is Byju’s edge over its competitors. What is attractive about Byju’s? What can it do to attract more users and expand?

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Photo credit: cherian_in/Flickr.com.