The rise and rise of Byjus: What’s next for the ed-tech giant?
Startup
Byju’s needs no introduction, thanks to its super aggressive sales and marketing army! It’s been an eventful last two years for the Indian ed-tech behemoth. The pandemic-caused school shutdowns being the wind beneath its wings, Byju’s is now growing at a lightning speed with soaring top line, fat cheques from marquee investors, and ballooning user base - all ingredients to an unprecedented success story.
Highest valued Indian startup
Highest valued global ed-tech company
An impending IPO at $21 bn valuation
The gold rush
Byju’s is now sitting on a cash war chest - the who’s who of the VC community continue to line up at its doorsteps with fat cheques.
With the money flowing in, Byju’s doubled down on its marketing and acquisition strategies.
Raised $1.65 billion in 2021
8 acquisitions for $2 billion in 2021
100+ million users 6.5 million paid users
Ahead of competition
Byju’s stands tall in the ed-tech space, having raced ahead of its competition by miles. Its nearest Indian competitor, Unacademy, commands a valuation of $3.4 billion - just about one-fifth of Byju’s market value.
Valuation of top Indian ed-tech companies:
What’s next?
The flagship segment of Byju's - the K12 (kindergarten to class XII learning) segment - is at the risk of a high churn rate if and when schools open up. With the vaccination drive picking up pace and pandemic effects slowly paring down, schools are bound to open up soon. Hence it becomes imperative for Byju’s to look for other alternatives to ensure growth and customer acquisition do not stagnate.
Exam prep, tuitions and upskilling
Exam prep and after-school tuitions are evergreen sources of income in India - the growth is guaranteed beyond pandemic surge.
Upskilling courses are in vogue in the market - with working professionals opting for online courses to better their chances in the job market.
Byju's foray into new segments with acquisitions:
Professional upskilling: Great Learning
Exam prep + tuitions: Toppr, Aakash and Gradeup
Offline presence: Akash Educational Services
Global domination
Whitehat Jr. rebranded as "Byju's Future School" was launched in international markets in April 2021.
"Byju's Early Learning" - a partnership product with Disney that targets the western audience did not yield expected growth rates due to the poor content on the app and cultural differences in the partnership.
The company also acquired "Osmo" - a well-known ed-tech player in the US markets.
The contribution margin of non-Indian markets stands at 25% as of FY20. The company targets to make it 50% by FY24.
A hardware company?
The recently filed FY20 financial report of Byju's turned a lot of heads. According to the report, 70% of revenue in FY20 is recorded from the sales of tablets and SD cards preloaded with educational content.
With no measure of learning outcomes, the question that arises - is Byju's an ed-tech company that sells content or a mere hardware company that sells SD cards?
A chink in its armour
Despite making a lot of right noises, the company is heavily criticized for its over-the-top sales and marketing strategies.
Due to the pressure of aggressive sales targets, the sales agents fool gullible parents into buying their products - parents who walk on the thin line of affordability.
Its subsidiary, Whitehat Jr. is notoriously known for silencing critics by wielding its power on platforms such as Linkedin and Youtube.
With an impending IPO, Byju's must mend its ways and ensure to come clean on all the accusations!
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