2022 has been a rollercoaster ride for the edtech sector. With schools reopening and edtech taking a back seat, Tracxn reports that general funding plummeted 35 per cent to $24.7 billion in the January-November period of 2022, compared to $37.2 billion in the same period in 2021. In fact, ‘Tracxn’s Geo Annual Report: India Tech 2022‘ reports that Indian EdTech funding was worst affected, along with the fintech and retail sectors.
Funding Drop
“The significant drop in funding is attributed to a decline in late-stage investments, which fell by 45% from $29.3 billion in Jan-Nov 2021 to $16.1 billion for the same period in 2022. Seed stage rounds are also experiencing a contraction and have dropped by 38% compared to the previous year,” the report added.
It seems the growth in the edtech sector was pandemically induced, and with schools reopening, as the time students spent online and the reliance of schools and colleges on online platforms for daily teaching & learning went down, the industry witnessed a significant drop. Indian EdTech witnessed a significant ~70% drop in fundraising in the second half of 2022 compared to the first 5-6 months of the year.
While 2021 saw immoderate investments, expansion and hiring to tap the edtech market faster and beat the competition, 2022, especially the second half, saw many shutdowns (SuperLearn, Qin1, Lido Learning, Udayy, and Crejo.Fun, etc.).
Current Market Focus
Also, the current edtech funding winter manifests how the investor-founder conversation has now moved to “unit economics, profitability, and sustainable cash outflow” compared to the “TAM ” (total addressable market) earlier. Given this shift, we saw countless instances of workforce thinning, business model pivots, funding withdraws, shutdowns, and more.
Number of Deals
As per our data on “Indian EdTechs funded in H1’22“, the edtech sector had 62 funding deals across the country until June 2022. As for the H2’22, our data tracks 40 deals with gross investment amounting to less than $700 million.
Top Deals by Value H2‘22
Based on funds raised, the top three Indian edtech fundings in H2’2022 are
- BYJU’s with $250 million
- upGrad with $210 million
- Sunstone Eduversity & Adda247 at $35 million each (sharing the 3rd place)
Geo Breakdown
If we look at the geo breakdown for the second half of 202
- Karnataka saw the highest number of deals (14), with the popular BYJU’s & Masai School deals
- Maharashtra saw the second-highest number of deals (13), and upGrad – one of the country’s most valuable EdTech companies – tops the leaderboard for the state
- Haryana (Gurugram) secured the third highest number of deals (06) with Sunstone Eduversity in the lead.
Most Funded EdTechs in 2022
Looking at the year, a significant portion of edtech funding was dumped into BYJU’s, Allen Career, upGrad, and LEAD School. More than 50 per cent of the total funding received in the entire edtech sector was raised by BYJU’s.
The 5 top funding edtech deals among 108 for the year 2022 are:
- BYJU’s – $1.05 billion
- Allen Career – $600 million
- upGrad – $435 million
- Eruditus – $350 million
- PhysicsWallah & LEAD School – $100 million each.
To help you better visualise the Indian EdTech funding scene, we have compiled a list of Indian EdTechs funded in H2 2022. The list is further segregated based on various segments in the EdTech sector, like eLearning, K12 solutions, HigherEd, upskilling, professional development, and more.
You may want to check out Indian EdTech Funding – H1 2022 Review.
