Byju’s becomes India’s most valuable startup

The ed-tech giant Byju’s, founded by Byju Raveendran, became India’s most valuable startup after a whopping $340 million funding in a new tranche of investment from UBS Group and Zoom founder Eric Yuan, Blackstone and others. The investment valued the startup at $16.5 billion.

Byju’s becomes India’s most valuable startup

The new valuation helped Byju’s outstrip Paytm, which last stood at $16 billion, for reaching the pinnacle in the Indian startup ecosystem. It was reported on April 30, 2021 that the UBS Group was in talks with Byju’s to invest in the firm. According to CB Insights data, Byju's is the 11th most valuable startup in the world, as of June 2021.

Byju’s has been on a fundraising spree since last year, since the pandemic fuelled the growth for online education. This new slice of investment is a part of a larger tranche that originated earlier this year. According to it, Byju’s is eyeing to tap over $1.5 billion.

Apart from its recent massive investment, its latest investors also include Baron Funds, Facebook cofounder Eduardo Saverin’s B Capital Group, and US-based hedge fund XN Exponent Holding. Byju’s also revealed that investors including Abu Dhabi government fund ADQ and Phoenix Rising had together invested about $350 million in the Bengaluru-based firm. Last year, Byju’s raised about $1 billion. Furthermore, India’s ed-tech startups together raised $2.2 billion in 2020, in comparison with $553 million in 2019, according to Venture Intelligence data.

Byju’s said it had on-boarded over 80 million users since the start of this year, 5.5 million of whom are paying subscribers. Byju’s, which is lucrative, generated revenue of over $100 million in the U.S. in 2020.

What’s in store now?

Byju’s plans to use the fresh principal, in part, to acquire more startups. Byju’s, which was also on an acquisition spree in the last 6-7 months, acquired Indian physical coaching institute Aakash for a massive $1 billion which is described as the largest buyout in India’s online education sector. It is now piloting due diligence to acquire an online learning startup ‘Toppr’ and has also tied up with US-based Epic, TechCrunch, informed earlier this year. After having acquired WhiteHat Jr, Scholr, Osmo, it is also in talks to take up Gradeup and Great Learning, recent news reports said.

The startup executives said at an event at UBS in Feb 2020 that Byju’s current revenue rate is $800 million, a figure they believe will cross $1 billion in the coming 12-15 months. This latest investment led by UBS Group comes at a time when the startup is looking to hasten its international relations with the onset of the Byju’s Future School platform. It is eyeing an entry into the US, UK, Brazil, Indonesia and Mexico, by the end of June.

The Indian ed-tech sector is expected to become a $30 billion industry in 10 years, according to a recent report by transaction advisory firm RBSA Advisors.

Byju Raveendran believes, "The future of learning is hybrid and it will bring together the best of offline and online learning, as we combine our expertise to create impactful experiences for students.”