Exclusive: Edtech unicorn Byju’s to raise $150mn, valuation to cross $5bn

Edtech unicorn Byju’s, run by Think and Learn Pvt. Ltd, is raising another $150 million (Rs 1,035 crore at current rate) as part of a fresh funding round from middle east and US-based investors, two sources directly aware of the matter told TechCircle.

Qatar’s sovereign wealth fund Qatar Investment Authority (QIA) is expected to lead the round, one of the two persons mentioned above said.

The other person, who is closely associated with the company, said the company is raising the funds at a valuation of $5.7 billion.

The company’s latest regulatory filings viewed by TechCircle showed that the company has already received $85.65 million(Rs 588.95 crore at current exchange rate) of the targeted sum.

The company had passed a resolution to raise this amount earlier this month, according to the company’s latest Registrar of Companies filings.

The $86 million infusion was led by Qatar-based INQ Holdings LLC, an entity which  is likely to be a subsidiary of Qatar Investment Authority (QIA). TechCircle could not independently ascertain and verify the credentials of this investing entity immediately.

INQ Holdings LLC put  in $52.64 million ( Rs 361.97 crore) while the rest came from San Francisco-based tech-focussed investment firm Owl Ventures and DIC Company Limited, whose credentials could also not be immediately ascertained by TechCircle.

The company raised the funds by issuing 5,188 compulsorily convertible preference shares, the filings showed. 

E-mail queries sent to Byju’s seeking more information on this funding round did not elicit a response at the time of filing this report.

The development comes less than a month after Business Standard, citing unnamed sources, reported that QIA is looking to invest around $200-$250 million for a less than 5% stake.

The company had last raised  $4.76 million (Rs 33.2 crore at current exchange rates) in March in a fresh round of funding from existing investor New York-headquartered private equity firm General Atlantic.

In December 2018, it had announced a  $540 million (Rs 3,855 crore then) funding in a round led by South African tech conglomerate Naspers. 

Byju’s

Founded in 2011, the venture runs learning apps for school students and produces all its content in-house. Byju's originally started off as a coaching platform for competitive entrance exams, and for students studying in classes 6-12.

Last year, it launched content for students from classes 4 to 5, helping them further accelerate their growth and then targeted an app for students in class 1-3.

The company is the best-funded and most valued Indian startup in the ed-tech segment.

The Chan Zuckerberg Initiative, the philanthropic foundation of Facebook founder Mark Zuckerberg and wife Priscilla Chan, Belgian family office Verlinvest, Canada Pension Plan Investment Board and the World Bank’s private sector arm, the International Finance Corporation, are among the firm's investors.

Byju’s sharply narrowed its loss for the year through March 2018, as a two-fold jump in operating revenue offset a rise in expenses.

The company reported net sales of Rs 471.18 crore for 2017-18, up from Rs 230.22 crore the previous year.

The company’s net loss reduced by almost half to Rs 37.15 crore from Rs 61.23 crore. This was despite an increase in total expenses to Rs 537.38 crore from Rs 309.38 crore.

Mrinal Mohit, chief operating officer of Byju's, had told TechCircle recently that the company was on track to triple its revenue for 2018-19 to Rs 1,400 crore.

Acquisitions

Byju’s has made a number of acquisitions in its quest for growth. It made its fifth acquisition in January 2019 by buying US-based digital learning platform Osmo for $120 million (Rs 840 crore then).

In July 2018, it had bought math learning platform Math Adventures for an undisclosed sum.

In July 2017, it bought Pearson-owned Tutorvista and Edurite as part of a single deal. Six months before that, it had acquired Bengaluru-based learning guidance tool and student profile-builder Vidyartha for an undisclosed amount.