Edtech startup BYJU’s is raising ₹1,750 crores ($250 million) from sovereign fund of Qatar called Qatar Investment Authority by selling less than 5 percent stake. Earlier this year in March, the startup raised ₹3,780 crores ($540 million) at a ₹37,800 crores ($5.4 billion) valuation.
This is the first investment for Qatar Investment Authority in the Indian tech-based startup segment. The fund had an earlier investment in corporate companies like ₹8,400 crores ($1.2 billion) in Bharti Airtel and ₹2,100 crores ($300 million) in office space developer RMZ Corp.
For this investment deal, the Qatari fund will be acquiring less than 5 percent stake. The term sheets for the contract have already been signed. This deal will mark the rising trend of investments from government funds in riskier Indian tech startup segment. BYJU’s is one of the few startups to receive money from such funds.
During its $540 million funding round, BYJU’s also attracted investment from Canadian pension fund CPPIB. While BYJU’s was the first to receive funds from CPPIB, the fund is now also investing ₹1,050 crores ($150 million) in exchange of 8 percent stake in Indian logistics startup Delhivery.
Founded by Byjy Raveendran in August 2015, the startup creates personalized courses and programs for individual students based on their proficiency levels and capabilities. The startups aim to help students learn at their own pace and style. The platform offers programs for competitive exams like NEET, JEE, GMAT, IAS, and CAT.
The startup turned profitable last year in June when it crossed ₹100 crores in monthly revenues. It acquired math-learning startup Math Adventures to enhance and strengthen its product offering for the lower grade students. BYJU’s counts Naspers, Aarin Capital, Sequoia Capital, Sofina, Chan Zuckerberg Initiative and several other prominent names as its key investors.
BYJU’s claims to have more than 3.5 crores registered users with 60 percent of its students hailing from tier II and III cities. The average renewal rate is 85 percent for the courses and programs. The number of paying students in the age group 9-17 had crossed the 15 lakh mark in March 2019 which is 50% more than the 10 lakh mark in the last financial year.
The edtech industry in India will touch ₹13,720 crores ($1.96 billion) mark by 2021. There are more than 3,500 edtech startups in India and around 182 of them raised total funding of ₹9,380 crores ($1.38 billion). However, more than 77 percent of this amount was raised only by four companies – BYJU’s, Toppr, Vedantu, and Unacademy.