Edtech startup Vedantu has become India’s latest unicorn after raising $100 million in a new funding round. The edtech startup attained unicorn status following an impressive year characterized by strong growth and increased operation.
Vedantu announced its unicorn status on Wednesday stating that the company’s valuation was up from $275 million from the beginning of last year. Vedantu is an online learning platform offering students in grade six through twelve live and interactive courses. Basically, its interactive platform works by providing courses to study and at the end of it, questions that students need to answer. The edtech partners with Airtel and Tata Sky to provide its wide range of courses for students at no cost.
Vedantu’s Series E funding round was led by ABC World Asia which is an equity firm located in Singapore. The round also saw participation from existing investors such as Tiger Global, WestBridge, Coatue Management and GGV Capital.
There were rumours about Vedantu being sold to Byju last month, but this rumour was debunked by the online learning startup. Vedantu is a startup on a mission. The startup aims to contribute to society by providing quality education to children in India. India holds the record for being the country with the highest population of school-age children and in contrast one of the countries that face huge educational challenges, especially children living in small cities. The startup is, therefore, contributing its quota of making quality education accessible to all.
According to the company, it has more than 35 million monthly active users and had 200,000 paying subscribers as of last year. It expects these figures to grow and hopes that the amount of paying subscribers at least doubles. As revealed by co-founder Vamsi Krishna, the startup’s revenue has grown more than four times in the past year and the company’s current annual rate is about $65 million.
Vedantu faces competition from Byju, which is India’s most valued Startup and was rumoured to be planning on buying the startup last month, and Unacademy. Unlike its competitors, Vedantu is not aggressive with raising funds and only does so when it is needed, Vamsi Krishna said. He added that with the recently raised funds, the company will attempt to become profitable in the next two years but its aim is imparting society. Speaking about the competition with other edtech startups, Vamsi Krishna said that “there is no right or wrong way to operate. You have to look at our genesis. We were already running a successful education venture. The reason why we started Vedantu was to solve the challenges teachers and students were facing. Having spent 16 years now in the education space, we know that creating a significant impact takes time. So our orientation has always been long-term”.
He went on to add that “as long as you are able to innovate for students and deliver value, nothing can prevent you from creating a long-term sustainable company. You can’t afford to keep getting distracted with what others are doing and how their revenue or valuation is growing. This is what we have been telling our team from the beginning”.
Chief Impact Officer of ABC World Asia, its lead investor for its Series E round commented that “Vedantu embodies our investment themes of providing better access to quality education and using digital technology to improve lives and livelihoods. In India, online education has the potential to extend the scope of ‘right to education’ to students in the underserved community and capture the ‘next half billion’ income group, representing over half of the country’s student population”.
He didn’t stop there, he added that “with edtech experiencing meteoric growth in India, Vedantu as the pioneer and category creator in LIVE online tutoring is driving the tectonic shift towards online learning. Vedantu’s innovative platform empowers teachers who have delivered excellent results to offer personalized education to many students at once, creating the potential for impact at scale. We are pleased to partner with Vamsi and the Vedantu team as they continue to scale and shape learning outcomes for students in India”.
The acquired funds will be used to increase offerings for students in grade one to five as well as explore expansion, merger and acquisition opportunities, Vedantu said.