Online education startup Byju’s raised $500 million from a group of investors, including private equity firm Silver Lake Partners, sending the valuation of the company founded by a star math teacher from Kerala to nearly $11 billion.
Existing investors Tiger Global, General Atlantic and Owl Ventures also participated in the investment round, Byju’s said in a note on Tuesday.
The company, named after its founder Byju Raveendran, has raised around $1 billion since January, reflecting the surge in investor interest in Indian edtech startups as remote learning replaced classrooms amid the lockdown.
Companies such as Byju’s are benefiting from the readiness of Indian middle-class families to spend a big chunk of their income on education and tutoring to give their children an edge amid rampant unemployment.
The surge in investor interest has catapulted Byju’s into India’s second-most valuable startup, also earning it the decacorn status—the handful of startups that are valued at more than $10 billion.
It’s not just Byju’s. The pandemic has also helped rival edtech startups sign up thousands of paying customers. Last week, Unacademy raised $150 million in a funding round led by SoftBank Vision Fund 2, tripling its valuation to $1.45 billion in just six months.
The edtech segment is poised to get more attention from investors in the near future, according to Sanchit Vir Gogia, chief analyst and founder, Greyhound Research.
“A large part of the customer base that Byju’s and Unacademy is targeting are still learners who don’t have access to smartphones, tablets and other gadgets. Edtech will turn into a larger market opportunity when it disrupts the core curriculum of schools and colleges,” Gogia said.
In a May 19 interview, Raveendran, 39, said, “Covid has been an inflection point for education where screens have become the primary mode of content consumption for students. The ‘classrooms of tomorrow’ will have technology at its core.”
On Tuesday, he said the crisis has brought online learning to the forefront. “Our classrooms are changing possibly for the first time in 100 years, and I’m excited about the opportunities we have to redefine the future of learning,” Raveendran said in a note.
The new round values Byju’s at $10.8 billion, up from its last valuation at $10.5 billion from its earlier Series F round that closed in August.
“This is a separate corporate round different from the earlier Series F round and there are more new international investors who are expected to fund Byju’s,” said a person familiar with the development.