Edtech start-up Eruditus looks for acquisitions to broaden its portfolio

By: |
August 23, 2021 5:15 AM

Besides, the Mumbai-based start-up will also look at acquisitions that have the potential to give the firm a foothold in the undergraduate segment.

Eruditus recently bagged a fresh $650 million in funding led by Accel and SoftBank Vision Fund 2 at a post-money valuation of $3.2 billion.Eruditus recently bagged a fresh $650 million in funding led by Accel and SoftBank Vision Fund 2 at a post-money valuation of $3.2 billion.

Edtech start-up Eruditus wants to broaden its play in the higher education segment and is open to acquiring firms that will help build on its portfolio of courses.

In an interview with FE, Eruditus co-founder & CEO Ashwin Damera said: “There are companies which may focus only on areas like data science or healthcare or financial certification programmes. If we can establish our presence in more branches of study through acquisitions, we will consider them.”

Besides, the Mumbai-based start-up will also look at acquisitions that have the potential to give the firm a foothold in the undergraduate segment.

Eruditus currently primarily operates in the professional upskilling space. It has restricted presence in the K-12 segment through iD Tech, a US-based provider of STEM programmes for learners in the 7-19 age bracket it bought in a $200-million deal. “Most of our learners today are working professionals or because of iD Tech, they are young adults. But we do not cater to people who are freshers, going into their bachelor programmes. That is an audience we know is large,” Damera said.

Eruditus recently bagged a fresh $650 million in funding led by Accel and SoftBank Vision Fund 2 at a post-money valuation of $3.2 billion. The start-up turned unicorn with the investment that saw its valuation increase by nearly four times. Investors infused about $430 million in primary capital while the secondary component amounted to $220 million as part of which existing investor Bertelsmann sold part of its shares.

The firm whose courses are priced at a minimum of Rs 30,000 and which could go up to as much as Rs 20 lakh for availing a programme from premium institutes like MIT or The Wharton School nearly doubled its base of paying students to about 100,000 within a year. The students pay about Rs 1 lakh in fees on an average. The firm has a target of reaching 200,000 paid learners in the next 12 months. “We work with very elite universities. So, there has never been a problem on the demand side for us. Our biggest challenge has been to convince the IITs and IIMs to partner with us. With the pandemic, every school realised that they need to have a digital strategy,” said Damera, who claims that Eruditus signed up nearly 25 universities in the last 12 months alone. It took the start-up eight years to get the first batch of 25 universities, Damera added.

The edtech company is looking to make $505 million in total booking revenues in FY22. The start-up that is present across 80 countries, including the US and China, follows a July-June financial calendar. Booking revenues increased to $175 million in FY21 from about $93 million in FY20. India and the US jointly drive the bulk of the revenues at present.

At a time when a slew of start-ups are hopping onto the IPO bandwagon, Eruditus is in no hurry to do so. “It is not at all on the table,” Damera said.

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