Indian Economy News

Edtech giant Byju's is raising US$ 300 million, valuation may touch US$ 18 billion

  • IBEF
  • October 5, 2021

Byju’s to raise ~Rs. 2,200 crore (US$ 300 million) as part of a greater round of new investment as the world’s most valuable edtech company concentrates on expanding its business in global markets and delve into more acquisitions.

According to industry sources, the latest funding may value Bengaluru-based Byju’s at US$ 18 billion, up from a valuation of US$ 16.5 billion in June this year. In June, Byju’s became India’s most valuable unicorn with a valuation of US$ 16.5 billion, exceeding fintech company Paytm’s US$ 16 billion valuation.

The company is planning to allot 77,174 Series F compulsorily convertible cumulative preference shares of the face value of Rs. 10 (US$ 0.13) each and at a securities premium of Rs. 2,85,062 (US$ 3,839.81) to the investors, according to regulatory documents obtained by business intelligence platform Tofler. The declaration for this funding was passed on September 27, 2021.

It is raising Rs. 2,200 crore (US$ 296.22 million) funding under private placement from Oxshott Venture Fund, together with the participation of Edelweiss Private Investments Trust, Verition Multi-Strategy Master Fund, IIFL Private Equity Fund, XN Exponent Holdings, and MarketX Ventures, among others.

Out of Rs. 2,200 crore (US$ 296.22) funding, majority of the capital which is about Rs. 1,200 (US$ 161.56 million) is going to come from Oxshott Venture Fund.

“The firm proposes to complete the allotment of the shares in 30 days from the date of the receipt of the application money for such shares,” said the firm in the document. “The firm needs funds to attain the working capital and business expansion plans.”

Byju’s is on an acquisition spree in India and globally as the pandemic has speeded up the adoption of online education. Students and professionals are considering upgrading their skills, while schools and offices remain closed.

The startup has now acquired about 8 companies in India and the US this year and spent >U$ 2 billion in the past six months on these acquisitions, according to sources. The inorganic route is anticipated to facilitate Bengaluru-based Byju’s to lead the edtech market.

In September, it acquired US-based Tynker, a leading K-12 creative coding platform for ~ US$ 200 million. The acquisition would further propel Byju’s US market expansion.

Some of the other deals include the US$ 1 billion buy of New Delhi-based Aakash Educational Services (AESL) in April and the US$ 600 million acquisition of Singapore-headquartered Great Learning, a leading global player in professional and higher education. In September it also acquired Gradeup, one of India’s largest online exam preparation platforms. In July 2021, Byju’s acquired US-based digital reading platform Epic for US$ 500 million.

Byju’s provides learning programs for students in LKG, UKG, classes 1 -12 (K-12) and competitive exams like JEE, NEET and IAS. Its app has >100 million registered students and 6.5 million annual paid subscriptions. With an average time of 71 minutes being spent by a student on the app every day from ~ 1700 cities, the app is making a whole new way of learning through visual lessons. Growing comprehensively, the firm has also launched Byju’s Future School lately. Powered by 11,000 qualified women teachers, this is available in the USA, UK, Australia, Brazil, Indonesia and Mexico and will progressively expand to more geographies in the near future. Furthermore, Byju’s Learning App featuring Disney was launched in the USA in July 2021, to help children ages 4–8 explore, practice, and understand math, language and reading concepts through interactive learning.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

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