EdTech unicorn upGrad, announced that it had secured $210 million (around INR 1,638 Crore) in a fresh round of funding from a clutch of investors, including ETS Global, Bodhi Tree (a JV of James Murdoch and Uday Shankar), and Singapore's Kaizen Management Advisors Pvt. Ltd.
The round also witnessed participation from Bharti Airtel’s family office, Narotam Sekhsaria Family Office (Ambuja Cements and ACC), and Artisan Investments (Family Office of Lakshmi Mittal - ArcelorMittal), with existing investors Temasek, IFC, and IIFL.
With this investment, upGrad plans to increase its team strength to 7,600 from the present 4,800. The statement added that it also aims to include about 170 full-time faculty, 1,600 teachers, and over 5,000 on-contract coaches and mentors.
According to the official statement, upGrad’s founder group also invested $12.5 million in this round to maintain theirs over 50% ownership in the company.
Commenting on the fundraise, Co-founders of upGrad, Ronnie Screwvala, and Mayank Kumar, said in a joint statement:
"Higher edtech will be on the rise for the next 4 to 5 decades. upGrad, in the last 12 months, has re-shaped itself to be the most integrated company in this space with career opportunities for the college learners and working professionals from the age of 18 to 58 and will be a lifelong learning partner for millions in the coming years. We have always been very capital efficient while growing 100% year-on-year, and hope to retain that discipline,"
Screwvala founded upGrad in 2015 with Mayank Kumar and Phalgun Kompalli to offer short entrepreneurship and data science courses. The platform spans several segments, from test prep to study abroad, and undergrad degrees to campus courses in 250 universities. Its offerings include finance, law, business, and software for the 18-60 age group. It has a learner base of over 3 million across 100+ countries and more than 300 University partners, and a robust enterprise business with a client base of 1000 companies worldwide.
upGrad has made five acquisitions this year so far, including Exampur, taking its total tally to ten deals to date. The startup last raised $185 million in August 2021 at a unicorn valuation.
The Mumbai-based firm claimed that it has a program completion rate of more than 80 percent and said that 40 percent of the company's total revenue is realized from repeats and referrals year-on-year. The company further said it is on track to record annual gross revenue of $400-500 million during FY23 (2022-23), of which about 45 percent of total revenue will be realized from its own-branded online courses and programs.
upGrad's multi-million dollar investment and aggressive hiring plans come when EdTech companies in India, including some of the highest-valued unicorns like Unacademy, Byju's, and Vedantu, are firing hundreds of employees amid a blip in demand for their services. The slowdown in demand has hit revenue projections of these EdTech startups, forcing investors to go cool on the sector, especially at late stages. EdTech companies in India have fired close to 6,000 employees in 2022 alone.