Why we invested in Geekster
“Why we invested in Geekster”
After spending upwards of 10 Lakhs in college, students willingly take up 3 Lakh annual package upon the fear of remaining jobless. Barring the top few percentage, struggle to land one’s first job is real for the majority.
And the possible reason for low package and demand for the freshers? They need to be trained! The company needs to pay learning and development cost out of it’s payroll for a period of x months before the fresher becomes a deployable resource.
And why is that so? Even after toiling years in a college for studying, why the student still don’t know enough and needs to be taught once again? Because the curriculum hardly teaches them what’s happening in the real world.
And the world is moving so quickly, with newer technologies being embraced on a regular basis, which further widens the gap between knowledge acquired from the rarely updated educational curriculum and the actual practical insights to be gained.
Now, on the other side of the coin, we have companies who are always on a hunt for recruits who can turn productive with least amount of training in the minimum possible time. But how to pick such talent out of the pool of CVs floating around?
Brilliantly combining both the problems, Geekster has crafted an ecosystem that provides a solution for both by having an Ed Tech arm and an HR Tech arm.
Ed Tech@Geekster (Focusing on Tech education)
College students are chosen for a 4-6 month training program where they are trained by three categories of instructors;?Educators (Core skill development), Mentors (Mentorship) and Industry Experts (Industry Exposure).
The student receives training in industry-relevant fundamental skills and exposure, making him 70 to 85% job-ready on day one of employment.
During the training phase, Geekster bears the full cost of training the students, and reimbursement only occurs after the student is hired.?????
?HR Tech@Geekster
300+ Hiring Partners sourcing recruits from Geekster’s?rigorously trained talent pool of freshers
What distinguishes Geekster from the competition
USP – Student
USP – Recruiter
USP – Investor
Sector Analysis
Continued Learning
Investment in companies leveraging technology to provide continued learning, across the past 5 years stands at USD 20B on a global level with 55% of the same happening in YTD 2022.
45% of the fund flow went to the US, 23% to China with India standing at third position by grabbing 13% of the funding.
15% of the companies in the sector have raised funding, out of which 13% are in Series A stage, 6% in Series B, 3% in Series C and 1% in Series D.
Average number of years from first funding to Series A stands at 2.4 Yrs, to Series B at 3.4 Yrs, Series C at 4.8 Yrs and Series D at 5.8 Yrs.
Maximum investments at the Seed stage was made by Y Combinator, 500 Global and Startup Chile whereas Sprintup, Sequoia Capital and GGV Capital are the top investors at the late stage.
Seed stage companies have bagged a Median Cheque size of $774k, Series A stands at USD 5M, Series B at USD 18M and Late stage USD 64M.
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HR Tech
Investment in companies leveraging technology for human resource solutions, across the past 5 years stands at USD 50B on a global level with 80% of the same happening in 2021 and YTD 2022.
65% of the fund flow went to the US, 7% to UK with India standing at Sixth position by grabbing 3% of the funding.
18% of the companies in the sector have raised funding, out of which 20% are in Series A stage, 10% in Series B, 6% in Series C and 3% in Series D.
Average number of years from first funding to Series A stands at 2.5 years, to Series B at 3.4 Yrs, Series C at 4.5 Yrs and Series D at 5.9 Yrs.
Maximum investments at the Seed stage was made by Y Combinator, 500 Global and Techstars whereas Index Ventures, Sequoia Capital and Y combinator are the top investors at the late stage.
Seed stage companies have bagged a Median Cheque size of $938k, Series A stands at USD 6.7M, Series B at USD 19.6M and Late stage USD 50M.
Why we invested in Geekster
-High Ticket Size Product
In India brands play the price game by valuing their product as low as possible to capture maximum market share. This practice comes at the cost of cutting down the business profit margin. In consequence, there is pressure to seize maximum number of customers since the profitability of the business is directly depended upon the volume of transactions.
Geekster has successfully ended this competitive play by setting the success price at Rs 200,000 per student. Furthermore, a whopping 65 percent gross margin gives the business enough leeway to produce a solid net profit and hence nice money for the stakeholders to take home.
No dissatisfied customer
Customer dissatisfaction stems out of paying for a service which they believe ?is not worthy of the penny paid for. The business model of the startup is cleverly designed in such a way that, only the customer achieving desired result needs to pay for the service. Those who gets placement will happily pay for the service while those who couldn’t convert don’t pay a dime. That is, those who couldn’t convert gets Industry level training for free, which will act as a boon for them further down the lane.
In effect the business model positively caters to both classes of the student pool successfully eliminating the chances of having dissatisfied customer.
Minimum Marketing spent ( Effectively bringing down Customer Acquisition Cost to zero!)
One of the major hurdle faced by an early stage business is to let others know of their existence. And for the same reason marketing spent creates a huge hole in the pockets of a new age startup.
Word of mouth publicity given by those who convert along with the absence of negative remarks from those who couldn’t convert, gives Geekster the benefits of marketing without spending for the same.
An year and half into the business, major challenge faced by Geekster is the heavy influx of student applications, of around 12000 to 15000, out of which the business caters only to 175-200 students per batch. The venture is already receiving 70x demand with minimum marketing cost.
Rapidly growing Industry with great market opportunity
High requirement of Upskilling due to ineffectiveness of traditional education creates a Total Available Market of USD 10B for Tech Education in India. Huge market with upwards of 1.5 Mn annual enrolments in tech courses creates a Serviceable Available Market of 4 Bn. Driven by a low penetration rate of less than 3% for e-learning solutions give rise to a Serviceable Obtainable Market?of 600 Mn.
Core Team
However brilliant the idea is, ultimately it all comes down to the execution. And hence, a promising core team is a no brainer investment strategy.
Ankit Maggu, Co-founder of Geekster, is an MBA graduate with a decade long stint in Corporate and Investment Banking. Extensive expertise in business deal execution coupled with Engineering back ground makes an him ideal candidate to lead a Tech based company.
Sahil Miglani, Co-founder of Geekster, Engineering graduate from Georgia Institute of Technology, brings to the table a decade long expertise in Software/Technology development from San Francisco Bay Area, the capital of Global Tech Industry. His employment experience at Yahoo and Pinterest helps Geekster to get a more global perspective.
Along with deep domain knowledge, the founders bring great passion and entrepreneurial spirit which when combined with their commitment to execution, give rise to a winning team.
We’re excited to hold hands with Geekster and be part of their success story!