Byju’s, India’s most valued online firm, continues its acquisition frenzy with the $600 million purchase of Great Learning.
Byju’s, India’s most valuable private internet business, said on July 26 that it had paid $600 million for upskilling platform Great Learning and that it would invest $400 million more in this area as part of its plan to extend its education services internationally across categories.
Byju Raveendran, the company’s wealthy founder, and CEO has taken another step toward bringing Byju public in the next 12-18 months. In an interview with Moneycontrol, Raveendran stated that Byju’s is open to listing in India, the United States, or both.
Byju’s fourth acquisition this year, the cash and stock deal, with some future payout planned, will help it expand its offerings beyond K12 (kindergarten to 12th grade) and test prep segments into the professional upskilling space, where firms like Eruditus and UpGrad are also building sizable businesses.
“This will allow us to access a new market with a lot of promise in terms of opportunities. It’s a very competitive market, yet they’ve managed to come up with a solution that’s both effective and efficient “Raveendran expressed his thoughts.
Great Learning has partnered with Stanford University, MIT, National University of Singapore, IIT Bombay, and Great Lakes Institute of Management to provide programs in Business Analytics, Data Science, Machine Learning, Cyber Security, and Digital Marketing. It claims to have influenced over 1.5 million professionals and students from 170 countries through its classroom and online programs, with a completion rate of over 90%.
Great Learning was founded in 2013 by Mohan Lakhamraju, the former India head of hedge fund Tiger Global, Hari Krishnan Nair, and Arjun Nair. The company is self-funded and expects to generate $100 million in sales in FY21. It will continue to function as a separate entity inside the Byju Group, with its founding staff remaining in place.
Eruditus, Simplilearn, and Upgrade are three more Indian ed-tech startups that are targeting this market. Sequoia and other investors are common to both Eruditus and Byju.
Byju’s has undertaken a flurry of acquisitions in the previous year as it tries to cement its leadership in the online and offline learning market across categories and locations.
It comes only a week after Byju’s announced the acquisition of Epic, a US-based reading platform, for $500 million, along with a $1 billion investment in North America, ostensibly one of its major markets. Osmo, a creator of instructional games, and WhiteHat Jr, a coding company, are among its other US-focused purchases. Future School, an online one-on-one live learning platform for math and coding, was recently launched in the United States, the United Kingdom, Brazil, Mexico, and Indonesia.
Byju’s lengthy buying binge has elicited astonishment, awe, and even memes in response to the extent to which the company would go to maintain its dominance. Users on social media joked that Byju’s will soon start purchasing government-run national boards of education and that it was India’s equivalent to Thrasio, with its powerful brand portfolio.
“I’m not required to have a reaction because it’s a meme. The education sector continues to be underfunded “, he declared
Byju’s acquisitions are also in sync with a $1.25 billion financing round that is currently underway. As part of this, it recently received $350 million at a valuation of $16.5 billion from UBS, Blackstone, ADQ, Phoenix Rising, and Zoom creator Eric Yuan, making it India’s most valuable unicorn. Byju’s is currently the world’s 11th most valued company, according to CB Insights statistics. Its income more than quadrupled over the previous year as more students opted for online lessons, totaling Rs 5,600 crore for the fiscal year ending March 2021.
The interest in Byju comes at a time when the Indian startup ecosystem is experiencing a financing boom and a flurry of Internet IPOs. While Zomato’s public listing was well-received, Paytm, PolicyBazaar, Nykaa, and Delhivery are among the startups planning to IPO in India this year.
“It’s encouraging to see investors prioritizing expansion. Our timelines, on the other hand, are not reliant on the timetables of others. We are considering listing in India or the United States, and will make a decision in 12-18 months “he stated
Given the crackdown by Chinese regulators on their local tech businesses, Raveendran sees more potential for Indian edtech entrepreneurs. According to the Chinese government, these venture-funded education companies should be regarded as non-profits, and private companies will be unable to list. The listed technologies saw their stock values plummet by more than 70%, signaling the end of a vibrant sector.
“I still feel these corporations are responsible for China’s rise to power. This may be beneficial to India since it would attract more investors,” Raveendran added.