After closing the financial year 2020 with INR 30 Cr in revenue, Delhi NCR-headquartered edtech startup Gradeup has announced its entry into the K12 segment with the launch of the Goprep app and portal. The Goprep platform will primarily cater to students from class 8 to 12, and also offer courses for students preparing for JEE and NEET.
Gradeup said that Goprep will be a standalone entity and will run parallel to Gradeup, which focuses on test prep and competitive examinations like JEE, NEET, IBPS, SSC, TET, GATE, UPSC among others.
Gradeup already offers live classes, interactive quizzes, mock tests, 24×7 mentorship and more to learners. The Goprep platform will leverage Gradeup technology to offer live classes, interactive sessions and doubt clearing processes to the students from class 8 to 12.
Founded in 2015 by Shobhit Bhatnagar, Sanjeev Kumar, and Vibhu Bhushan, Gradeup offers its test prep courses across sectors to students across India, with banking and SSC prep being the most popular segments. Gradeup claims to have more than 2.5 lakh paid subscribers and over 2 Cr registrations in total. In the financial year 2020, ending March, the company recorded a 5x growth in revenue, amounting to INR 30 Cr, however, it has not yet filed its financials for the year officially. The company also claims to be operationally profitable, with most of its investments going into Goprep.
In an interaction with Inc42, Bhatnagar highlighted that the company noted a surge of 25-40% in live class engagement across various exam categories during the national lockdown. JEE and NEET had emerged as the most popular courses due to exams being postponed.
With the global lockdown due to Covid-19, edtech has been receiving much greater traction. The current challenge in the edtech sector is to turn the short-term interest of students and parents into long term trust. It also presents an immense opportunity for those who are able to win the trust of students and parents by providing quality education will thrive in this space.
“The current situation is certainly an opportunity for edtech, it is somewhat similar to what demonetisation was for digital payments. We are witnessing an increase in the digital consumption of educational services. A change is occurring in the student’s behaviour; there is a willingness to try and learn online,” Bhatnagar added.
Entering The Crowded K12 Segment
Gradeup cofounder Vibhu Bhushan, who has founded the Goprep platform, believes the K12 and test prep segment is a huge addressable base with more than 60 Mn students and has been witnessing a year-on-year (YOY) growth. “Even if you consider just CBSE or few premium state boards like Telangana, Kerala or Maharashtra, it would be a good 30-35 Mn students combined,” he added.
According to Datalabs by Inc42, there are around 4450 edtech startups in India. The Future Of India’s $2 Bn Edtech Opportunity Report 2020 highlighted the K12 segment, the most dominant edtech sub-sector, is expected to reach a market size of $773 Mn by 2021, growing at a compound annual growth rate (CAGR) of 60% between 2016 and 2021. Among other prominent startups catering to students in K12 and online test prep segment are Lido Learning, Toppr, Vedantu, BYJU’S, Unacademy, Testbook, Doubtnut, Cuemath and others.
BYJU’S is the biggest player in the edtech domain. It has more than 47 Mn registered users and 3.5 Mn paid subscribers, coming from over 1,700 rural and urban areas in India. The company claims that users were spending 71 minutes per day on its educational app, and has reached an annual renewal rate of 85%. During the lockdown, the platform noted a 150% hike to add over 6 Mn new students from metro and non-metro cities.
Lido Learning has over 2K paying customers, and over 1000 employees, including 400 teachers. The company claims to have witnessed an average growth rate of 50% month-on-month (MoM). Edtech startup upGrad which provides higher education courses claims to have more than doubled its course capacity, and each class now has a peak capacity of 1000 learners. In a recent statement, upGrad cofounder and executive chairman Ronnie Screwvala said, “The larger the class in online, the more active the peer-to-peer learning and so it’s the inverse of offline learning.”
“Last month we reached 5,00,000 learners for our online programs, which is no mean feat in itself. Now take into consideration that our average ARPU is INR 2.5 lakhs. Yet, we are only at the very start of addressing a market of over 100 million working professionals and graduates,” he added.
The startup claims that in the current quarter, its revenue will cross an annual run rate of INR 500 Cr with the launch of the live learning platform. It said it recorded 10,000 enrollments for its free courses in the quarter so far till May 4, 2020.
Bhushan specified that the K12 segment is more homogenous than test prep, which has a different syllabus or a different set for each test. But it’s also the most competitive. Bhushan said Gradeup’s extensive experience in the edtech sector would come in handy to scale up Goprep, particularly the expertise in content creation.
Goprep is looking to replicate the experience of a neighbourhood tuition centre, but with assured quality education, data recording and other digital tools. The platform is currently onboarding teachers and plans to hire around 50 to 55 educators to educate 10K school students by the end of the year.
Bhushan also elaborated that both the students and the teachers will have the autonomy to choose what they want to study. Test prep and skill enhancement segments have always earned good traction, but for K-12 the adoption has been slow and steady, which is about to change to rapid adoption in the post-Covid-19 world.