In a transaction that could fetch Byju’s a post-money valuation of around $12 billion, a clutch of investors, including BlackRock and T Rowe Price, is believed to be infusing close to $200 million into the ed-tech player.
This will be the sixth fundraise by the company in 2020; in September, Byju’s had announced a fresh $500-million funding round with new investors like Silver Lake, Alkeon Capital and others at a valuation of just over $11 billion.
Byju’s did not respond to FE’s queries.
The Bengaluru-headquartered company, whose revenues have grown at a compounded 125% over the past three years to approximately $400 million, has mopped up some $2 billion so far.
The ed-tech sector has cornered the bulk of the start-up funding this year with students across the country signing up for ed-tech services to make up for lost school hours.
In an interview with FE in late September, founder & CEO Byju Raveendran mentioned the company added more than 25 million free users on the platform between April and August compared with just above 40 million in the first four-and-a-half years.
“Students who benefited by accessing the content signed up for subscription…We are at 4.5 million paid users on a 70 million free user base. Now, a lot of users will continue learning online on the other side of the crisis and we expect the conversion to actually increase,” Raveendran had said.
Experts point out ed-tech is growing on the back of changes in the approach to education and the rapid rise in the use of smartphones. Of the three broad categories – K-12 supplementary teaching for grades 1-12, test-preparation and higher education – analysts at HSBC reckon K12 offers the most potential. “K-12 is unsurprisingly the biggest opportunity and we think the market can grow up to $5 billion in five-seven years. Test-prep, which is higher education & government examinations, could be a $1.5-billion opportunity over a similar time frame,” Yogesh Aggarwal and AbhishekPathak wrote in a recent report.
Earlier this year, rival Unacademy turned a unicorn after it raised $150 million in a round led by SoftBank.