The Bengaluru-based startup has now received over $150 million in funding as it prepares to launch its mobile app-based learning platform in overseas markets.
“Byju’s is in talks with several other investors, including World Bank arm IFC and Google Capital and could raise more capital as a part of this round,” said one of the people quoted above. This current investment round is co-led by existing backer Sequoia Capital, along with Sofina, Lightspeed Ventures as well as Times Internet, which is the digital arm of Times Group which publishes this newspaper.
Chan Zuckerberg Initiative is an entity designed to deploy 99% of the wealth of its benefactors -estimated at over $50 billion -across private companies and non-profits. The fund recently lead a $24million round in Andela, a Nigeriabased company that trains and deploys software developers. Byju’s is its first investment in Asia.
“Education can give young people and their families a path to a better future, and families in India work hard to give their children that chance. Byju’s represents an opportunity to help even more students develop a love for learning and unlock their potential,” said Vivian Wu of Chan Zuckerberg Initiative in a statement. She will join the board of Byju’s.
The immediate focus for Byju’s is to expand its user base in India, even as it plans for an international expansion which will take 18 months. The company’s founder Byju Raveendran estimates his company spent nearly three-and-ahalf years and some $45-50 million to build its product for India. The application, which claims an average engagement time of 40 minutes, is used in some 1,400 towns across India.
“But our international plans will be accelerated because we have much bigger bandwidth, and if there are some special companies which can help us accelerate that process we would be looking at acquisitions,” he said. The company , which already has presence in the Indian and Middle East markets, is looking to expand to the USA, the UK, South Africa and other African and Commonwealth markets. Byju’s, last year, transitioned from a classroom model to a smartphone-based education company , after raising money from Sequoia Capital India. The company claims that revenue has grown from `45 crore to `120 crore in fiscal 2016.
The app called Byju’s Learning App is growing at 15% month-onmonth and has crossed 5.5-million downloads. The application has 2,50,000 annual-paid subscribers, having added 30,000 paid students last month. It is some of these metrics that would have helped Byju’s garner its current valuation, as experts feel that none of the business to consumer (B2C) startups in education technology space have been able to prove a business model. Byju’s, which works on a freemium model, has a conversion rate of 5-6% right now and 90% subscription renewal rate.
“If that is true then this is a business which has got a valuation which is beyond revenues and EBITDA (a measure of operating profit), but based on the scarcity of consumer-oriented businesses in the space and potential that this can be a winner takes all situation,” said Sandeep Aneja, who runs an education-focused private equity fund Kaizen.
Byju’s makes use of original content, graphics and other video tools to explain concepts and theories that makes learning contextual and visual, not just theoretical. It leverages technology and data science to make learning personalized so that the students will know what to learn, when to learn, how to learn, how much to learn, and how fast to learn.
“We are really excited to welcome an investment from Chan-Zuckerberg Initiative into Byju’s, as the company continues on its mission of empowering everyone who aspires to learn. Together, the platforms will enable greater reach for a high quality pro duct developed by a great team,” said Satyan Gaj wani, Vice Chairman, Times Internet.
Source : The Economic Times (Delhi)