Venture Debt Has Been A Very Useful Tool To Grow The Business Without Additional Dilution, Says Toppr Cofounder Zishaan Hayath
Mumbai-based personalised elearning solutions provider and online test preparation platform, Toppr has raised a venture debt funding of $2.3 Mn (INR 15.5 Cr) from Alteria Capital – the new fund launched recently by Ajay Hattangdi and Vinod Murali.
Founded in 2013 by Zishaan Hayath and Hemanth Goteti, Toppr helps students prepare for competitive entrance exams like IIT JEE Mains and Advanced, BITSAT, NEET etc. The company caters to students between 5th and 12th Grades and its learning pieces include questions, solutions, concepts, practice tests and videos for the students signed up on the app.
“The Alteria team understands the needs of entrepreneurs and is sensitive to their requirements. Venture debt has been a very useful tool to grow our business without additional dilution and we are happy to have Alteria as our partner in this journey,” said Zishaan Hayath, cofounder and CEO of Toppr.
So far, Toppr has raised a total of $18.92 Mn in equity funding. It raised its last investment of $6.92 Mn (INR 45 Cr) in a Series B funding round, led by its existing investors SAIF Partners, Helion Ventures, and FIL Capital Management.
In February 2016, Toppr also acquired edtech startup Manch. The company is pursuing aggressive expansion plans, to reach out to students across the country.
As stated by Vinod Murali, the cofounder and managing partner at Alteria Capital,”The needs of Indian students cannot be met solely through classrooms and using technology well to improve personalisation and convenience for students while still providing high-quality content and monetising for it, has been the key to Toppr’s success.”
The deal represents the third investment from Alteria Capital’s maiden $148.5 Mn (INR 1,000 Cr) fund, which includes a $118.8 Mn (INR 800 Cr) corpus and a greenshoe option of $29.7 Mn (INR 200 Cr). It had its first close in February 2018 at $52.86 Mn (INR 356 Cr) of commitments which includes anchor investments from IndusInd Bank and a large Indian Family Office Foundation.
Alteria has also received a sanction of $14.8 Mn (INR 100 Cr) from SIDBI subsequent to the first close. Alteria will provide venture debt to high growth, innovative Indian startups with a cheque size range of $297K – $14.8 Mn (INR 2 Cr – INR 100 Cr). Earlier in March, the venture debt firm invested in Fingerlix and Universal Sport.
In an earlier media statement, Toppr has projected 20x growth in its junior grades and 15x growth in its senior grades subscription by 2021, making it a startup with over $500 Mn in revenue in the next four years.
In India, elearning will see approximately 8x growth in the next five years, says a recent report by Google, KPMG. This will have a significant impact on the edtech market that has a potential to touch $1.96 Bn by 2021 from where it stands now i.e. $247 Mn.
Other startups in the online test preparation space include Embibe, Examify, TestBook among others. Last year, Amazon India also announced launch of Exam Central bookstore, to provide exams related information, preparation books and other study material to students and job aspirants on its portal.
