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In the beginning of the year, Bengaluru headquartered an EdTech platform BYJU’S acquired a Mumbai-based online coding platform WhiteHatJr for $300 Mn. This deal marked the biggest acquisition and merger in the EdTech sector of India till date.
Founded in 2011 by Byju Raveendran and Divya Gokulnath, BYJU’S is the world’s highest-valued EdTech company with a valuation worth of $10 Bn. In January, it raised an amount of $200 Mn from General Atlantic, Tiger Global and Bond Capital and this was considered as the biggest funding round or by an EDTeach in India in 2020’s first half. It was in the last month when company beat its own record by raising an amount of $500 Mn from Silver Lake an US based equity investor and for that exchanged a 2.09% stake in itself.
Therefore, BYJU’S is has now also become the biggest acquirer platform in the Indian EdTech sector as per an Inc42 Plus report. Since 2017, the company has been utilizing all its acquisitions to capture the EdTech sector of the country.
In the last year, it acquired Osmo; a US based learning platform for an amount of $120 Mn under its international expansion plans. Previous to that, in the year 2018 it acquired Math Adventures; a math learning startup. In 2017, the company also acquired US-based online tutoring app TutorVista and Edurite from Pearson along with a student assessment platform Vidyartha.
Analysing all the acquisitions of BYJU’S it could be summarized that the company is focusing on start-ups that are young with would reveal that the focus seems to be on assimilating younger startups with slot offerings. The most recent acquisition by BYJUs of WhiteHatJr stated that the former’s focus was on the latest demand of students i.e. coding.
As for TutorVista, the platform gets around 70% of its users from the US, making it a viable acquisition for BYJU’S as it tries to further its global presence. Similarly, a Math Adventures’ model involves a facilitator who takes one class out of weekly allocated mathematics classes in various schools that helps students to understand concepts by means of activities they learnt in their conventional classes.
Discussing about the various mergers and acquisitions’ philosophies, Raveendran said that they are focusing on critically analysing the synergies between both the companies so as to increase scalabilities in the future.
A similar amount of mergers and acquisitions can be seen done in another EdTech unicorn or start-up called Unacademy. In July, it acquired PrepLadder, a postgraduate medical entrance exam preparation platform for an amount of $50 Mn. The acquisition is expected to strengthen Unacademy’s presence in the medical entrance examinations categories such as the National Eligibility cum Entrance Test (NEET) for medical postgraduate courses and apart from that it also has acquired a majority stake of $5Mn in K12 learning platform Mastree.
Earlier this year, Unacademy also acquired another EdTech startup called Kreatryx to strengthen its presence in the test prep market. Apart from that it also acquired a Mumbai-based competitive programming platform named CodeChef.
With the absorption of a wide range of offerings being made in the Indian EdTech space, apps like BYJU’S and Unacademy are moving closer to become ‘Super Apps’. Super Apps are those apps that has multitude of offerings which gives students a variety of choices and a complete learning experience.
Such large and continuous merger and acquisitions in the EdTeach sector of India may witness a duopolistic market in the country.
Amazon and Flipkart are now giving a platform to the small sellers and owners of kirana stores to sell their products and expand their business by increasing customer base. BYJU’s can rope in any neighbourhood tutor and the tutions can be subsumed under the online learning platforms. As per Inc42 Plus report, Indian EdTech Sector has a $10 Bn Opportunity as the market size is of $2.8 Bn in 2020. It is expected to grow at a CAGR of 39% in order to reach a market size of $10.4 Bn within 5 years. The major factors that are leading to the adoption of EdTech apps in India are and will be:
- Convenience
- Cost-efficiency
- Surge in out-of-pocket expenditure on education
- Rise in course fees.
