Vedantu enters unicorn club after $100 million funding from Temasek-backed ABC World, others
Edtech startup Vedantu has secured $100 million in a new funding round led by Temasek-backed impact investing fund ABC World Asia. The funding also saw participation of presented investors like Coatue, Tiger Global, GGV Capital and WestBridge Capital.
With this, Vedantu’s valuation has crossed to $1 billion compared to around $600 million last year when it raised $100 million from Coatue. This makes Vedantu the 28th Indian unicorn so far this year, joining the likes of Byju's, Unacademy, Eruditus and upGrad in the coveted club. Temasek lately led funding rounds in both Unacademy as well as upGrad.
Vedantu said the round hasn’t closed yet and more investors are likely to join in subsequent tranches. As per sources aware of the matter, there could be another $10-$20 million added to the current round at the same valuation.
The Bengaluru-based online tutoring platform provides individual and group classes across K-12 and test preparation segments. It offers classes for CBSE, ICSE as well as for state board students.
The new capital is expected to be used by Vedantu to double down on its core business and expand overseas and add vernacular languages in its coaching here. It also plans to add tutoring solutions for Grade 1-5, going forward, CEO Vamsi Krishna said.
“Vernacular languages are going to be a big focus for us in the next two years. We are also going to look seriously at international expansion over the next 15 months. We are looking at geographies like Gulf Cooperation Council (GCC) countries as well as the Southeast Asian markets, Europe and others,” Krishna stated.
It has over 35 million students accessing its platform and it expects around half a million students to be paid users this academic year. In the previous academic year, it had around 200,000 paid users which too was a growth of three times, he said.
“We have grown two-three times across metrics. Currently we are at a $65 million annualised revenue run-rate which is three times higher than last year,” Krishna further said.
Acquisitions & Consolidation
Vedantu, for its planned expansion, will depend on both organic and inorganic routes. It will also use the new capital to reinforce functions like product engineering and others.
Led by Byju’s, the segment has seen large-scale consolidation with multiple M&As over the past six months. As per a report Byju’s has spent over $2 billion for major acquisitions like Aakash Institute, Great Learning and others. Unacademy too has been on the prowl for deals.
In July, Vedantu proclaimed that it has acquired a majority stake in AI-enabled personalised learning platform Pedagogy but did not disclose the financial terms of the investment.
Vedantu also bought doubt-solving app Instasolv in what was its first acquisition. The deal added close to one million potential learners of Instasolv to Vedantu’s platform.
“Vedantu's innovative platform empowers teachers who have delivered excellent results to offer personalised education to many students at once, creating the potential for impact at scale. We are pleased to partner with Vamsi and the Vedantu team as they continue to scale and shape learning outcomes for students in India,” stated Sugandhi Matta, chief impact officer, ABC World Asia.