India’s Byju’s raises $250m, ramps up overseas
Indian education technology provider Byju’s has raised USD 250m from existing investors with plans to expand its international business. Funding raised this year alone now tops USD 1bn.
Qatar Investment Authority (QIA) is the only confirmed investor in the latest round. It follows a USD 800m round in March that featured BlackRock, Sumeru Ventures, and Vitruvian Partners, with Byju’s founder Byju Raveendran (pictured) providing USD 400m in his own capacity. That round valued the company at USD 22bn.
The new investment comes less than a week after the company confirmed it would cut 5% of its staff, or around 2,500 people, in an effort to tighten up unit economics and achieve profitability by March 2023.
Plans for an IPO have recently been deferred, with Raveendran citing macro uncertainty. The company is also seen as facing challenges around students' post-pandemic screen fatigue and negative optics related to allegations of a high-pressure sales culture.
“Byju’s is now at that sweet spot of its growth story when the unit economics and the economies of scale both are in its favour. This means the capital that we now invest in our business will result in profitable growth and create sustainable social impact,” Raveendran said in a statement.
“Regardless of the adverse macroeconomic conditions, 2022-23 is set to be our best year in terms of revenue, growth, and profitability. Continued support from our esteemed investors re-affirms the impact created by us so far and validates our path to profitability.”
Byju’s is doubling down on plans to become a more global brand. In the past two years, it has committed at least USD 1bn to a North American expansion, including the USD 500m acquisition of Epic, a reading platform targeting children aged 12 and younger.
Earlier this year, the company set up a Qatar-based subsidiary in partnership with QIA that will cover the Middle East and North Africa region. This coincided with the acquisition of Singapore-based Northwest Executive Education for an estimated USD 100m.
Byju’s offers K-12 education videos to more than 150m students globally, with a focus on exam candidates outside of metro areas. The number of paid subscribers was said to be as high as 7.5m as of last March, compared to 4.2m two years ago. The company has recently claimed an annual subscription renewal rate of 86%.
Previous investors include Silver Lake, Tiger Global Management, General Atlantic, Chan Zuckerberg Initiative, Edelweiss Private Equity, IIFL Alternate Asset Advisors, Oxshott Capital Partners, Time Capital, Verition Fund Management, Asmaan Ventures, Mirae Asset Global Investments, UBS, and US education specialist Owl Ventures.
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