Ronnie Screwvala, Temasek Pump INR 300 Cr In upGrad

Edtech major upGrad has raised INR 300 Cr via a rights issue, seven months after it raised $210 Mn (around INR 1,728 Cr) in a funding round in August 2022.

In a press statement, upGrad said existing investor Temasek invested INR 81 Cr and upGrad’s cofounder and chairperson Ronnie Screwvala contributed INR 212 Cr. The rest of the rights issue was mopped up by other minority stakeholders.

Commenting on this development, a spokesperson from upGrad said, “Yes, we confirm the internal round. The company is focused on its organic and in-organic growth across multiple verticals of formal education via degree, diploma and doctorate courses in partnership with the best universities in India and globally.”

The rights issue follows as upGrad’s consolidated net loss reached INR 626.6 Cr in FY22 as against INR 211.1 Cr in FY21, a jump of nearly 3X. The upskilling giant’s bottom line took a hit despite a 2X jump in operating revenue to INR 679.2 Cr from INR 327.1 Cr reported in FY21.

The development also comes more than two months after the upGrad’s CEO Arjun Mohan bid farewell to the edtech unicorn.

Founded in 2015 by Screwvala, Mayank Kumar, Phalgun Kompalli and Ravijot Chugh, upGrad is an edtech platform that provides higher education courses in collaboration with various universities. It is backed by the likes of Temasek, Murdoch’s Lupa Systems, International Finance Corporation, and IIFL, among others.

Excluding the latest funding, upGrad has raised $555 Mn across multiple funding rounds since 2021, with the latest round of $210 Mn last year.

Last year, the edtech giant was on an acquisition spree, picking up Work Better, Exampur, International School of Engineering (INSOFE), and Harappa Education, among others, during the year. 

However, this was followed by layoffs across upGrad’s group companies. Harappa Education, for one, fired 40% of its workforce in January, or around 73 employees. Later on, upGrad Campus followed, firing 30% of its headcount, or about 120 people.

Edtech in India has suffered the most since normalcy returned after the subsiding of the COVID-19 pandemic. According to Inc42 data, edtech funding went from $4.73 Bn in 2021 to $2.64 Bn in 2022, a fall of more than 44% in a year.

A prolonged funding winter has seen tens of edtech companies firing thousands of employees. Per Inc42’s ‘Indian Startup Layoff Tracker’, edtech companies have fired more than 8,400 employees since the start of 2022.