Less than two months after it raised $500 million in a financing round, edtech decacorn Byju’s is learnt to have raised $200 million in a fresh round of funding. This has lifted the Bengaluru-based firm’s valuation to $12 billion, about $1 billion more since the previous round.
Sources close to the development said private equity players BlackRock and T Rowe Price also participated in the new round. While BlackRock is an existing investor in Byju’s, T Rowe has joined as a new investor. A Byju’s spokesperson declined to comment on the development while BlackRock and T Rowe Price could not be reached immediately.
With this investment, Byju’s has raised over $2.3 billion from investors in 18 funding rounds so far.
During the ongoing pandemic, the Byju Raveendran-founded company has seen a significant rise in its valuation, as education has largely moved online with schools and colleges being shut down to prevent the spread of the virus. After achieving the decacorn status in July, when it had received a funding from Mary Meeker’s Bond Capital at a valuation of around $10.5 billion, the edtech firm had seen its valuation rising further to $11.1 billion in September at the time of another round of funding led by Silver Lake. BlackRock, Sands Capital and Alkeon Capital had also participated in that round.
In a recent interview with Business Standard, Raveendran had said while the company was generating enough cash now, funding by investors would help it when the company went for acquisitions. “There are always investors’ conversations going on. We have not necessarily raised money because we need it for an immediate purpose. We are not burning cash in India. Having cash or money in the bank sometimes helps you to take (acquisition) decisions faster,” he had said.
With the latest round of funding, Byju’s has further narrowed its valuation gap with financial services platform Paytm, which at present has a valuation of $16 billion, according to the Hurun India Unicorn Index 2020.
The Bengaluru-based firm has also seen a stellar growth since a lockdown was imposed in March. It has added over 25 million new students on its platform since then. Today, the app has over 70 million registered students and 4.5 million annual paid subscriptions. The firm, which almost doubled its revenue from Rs 1,430 crore to Rs 2,800 crore in FY20, is inching towards the $1-billion-revenue milestone.
Looking beyond the home turf, Byju’s is looking to spread its wings in international markets, including in the US. It has also been playing strongly in the acquisition space and has so far made over six acquisitions, including that of Mumbai-based edtech start-up WhiteHat Jr, its biggest bet so far at $300 million. The coding platform had to recently withdraw certain ads after they were found to be violating guidelines issued by the Advertising Standards Council of India, for making unsubstantiated claims.
“If there are companies, people or teams where we can build conviction about the complementary nature of what they are coming out with, you could see us doing a few more acquisitions in the next two-three quarters,” Raveendran had said in the interview.
The edtech segment has seen a funding boom in the wake of the coronavirus pandemic, as more and more people are realising the potential of online education. Gaurav Munjal’s edtech startup Unacademy also became a Unicorn in September after it raised $150 million in a round led by Japanese conglomerate SoftBank, valuing the company at $1.45 billion. Another edtech company Eruditus raised over $100 million from marquee investors like Chan Zuckerberg Initiative and is on track to becoming a Unicorn by next year.
According to Venture Intelligence data, the amount of capital invested in edtech startups in the country has increased nearly four times to $1.5 billion in the first nine months this year, compared with $409 million in 2019.