A learning app created by a former Indian math teacher has led its inventor to become a new Indian billionaire.
Byju Raveendran, 37, founded the Think and Learn company in 2011, which is dedicated to online tutoring. The company recently raised $ 150 million from the Qatar Investment Authority, bringing the valuation of Raveendran’s company to $ 5.7 billion.
Raveendran grew up in a village in southern India and at school he was not a very good student; he even used to skip classes to go to play soccer, although later he would study at home. He later became an engineer and began helping his friends prepare for college entrance exams. In 2011 he created Think and Learn, in which he offered math lessons online and then included paid online courses, until in 2015 he launched the BYJU’S app.
Digital learning is booming in India, where internet use has exploded due to the ubiquity of cheap ‘smartphones’ and low-priced mobile phone plans. In recent years, the fortune of the company founded by Raveendran has grown hand in hand with the market and its revenue is expected to double to more than Rs 30 billion (about $ 435 million) in the year ending March 2020. That pace of growth has caught the attention of some of the tech industry’s biggest investors, including Facebook founder Mark Zuckerberg.
The app has 35 million registered users, of which approximately 2.4 million pay an annual fee of between Rs 10,000-12,000 ($ 145-175), helping the company reach profitability at the end of last March. ; that’s when Raveendran began courting long-term investors such as pension funds and sovereign wealth funds.
Byju owns more than 21% of the shares of the company, but in the last round of financing his wife and brother also bought some titles, bringing together a total stake of around 35% in the company.
Edtech giant Byju’s has become the most valuable startup in India after raising about $350 million in a new tranche of investment from UBS Group and Zoom founder Eric Yuan, Blackstone and others that valued the Bangalore-based firm at $16.5 billion (post-money).
In a new filing, Byju’s revealed that scores of investors including Abu Dhabi government fund ADQ and Phoenix Rising had together invested about $350 million in the startup. The new valuation helps Byju’s surpass Paytm, which was last valued at $16 billion, for the crown position in the Indian startup ecosystem. (Paytm is currently working on exploring the public markets and eyeing to raise as much as $3 billion and eyeing a valuation of up to $30 billion.)
The new tranche of investment is part of a larger round that Byju’s kickstarted earlier this year and is looking to secure over $1.5 billion. Some of its recent investors also include B Capital Group and hedge fund XN. The startup was valued at $11 billion late last year, and $5.75 billion in July 2019.
The startup plans to use the fresh capital, in part, to acquire more startups. Byju’s, which acquired Indian physical coaching institute Aakash for nearly $1 billion earlier this year, is conducting due diligence to buy and online learning startup Toppr and has also engaged with U.S.-based Epic, TechCrunch reported earlier this year.
Byju’s prepares students pursuing undergraduate and graduate-level courses, and in recent years it has also expanded its catalog to serve all school-going students. Tutors on the Byju’s app tackle complex subjects using real-life objects such as pizza and cake.
The pandemic, which prompted New Delhi to enforce a months-long nationwide lockdown and close schools, accelerated its growth, and those of several other online learning startups including Unacademy and Vedantu.
As of early this year, Byju’s said it had amassed over 80 million users, 5.5 million of whom are paying subscribers. Byju’s, which is profitable, generated revenue of over $100 million in the U.S. last year, Deborah Quazzo, managing partner of GSV Ventures (which has backed the Indian startup), said at a session in March held by Indian venture fund Blume Ventures.
The startup executives said at a UBS event earlier this year that Byju’s current revenue run rate is $800 million, a figure they expect will reach $1 billion in the next 12-15 months. It has also accelerated its international expansion plans in recent months.
