Unacademy is looking to boost its position in the test prep market through Graphy, its visual learning platform
The company reported a 4x increase in revenue in FY2020 to INR 86 Cr, with a net loss of INR 112 Cr
CEO Gaurav Munjal said the company has close to $300 Mn in the bank but will look to improve its revenue rate in the coming months
After adding six companies to its bucket in 2020, Bengaluru-based edtech unicorn Unacademy is looking to acquire two-three more companies in 2021 in order to expand its product offerings. It is also looking to particularly focus on the test prep vertical and become cash-flow positive this year.
Unacademy is looking to boost its position in the test prep market through ‘Graphy’ and its acquisition of K-12 learning platform Mastree. Unacademy acquired Mastree in June 2020, and introduced Graphy a month later in July. It allows students to explore stories, ideas and original content through multimedia.
Unacademy has acquired six companies in India till date. This includes postgraduate medical entrance exam preparation platform PrepLadder for $50 Mn, test prep platform Kreatryx for GATE and ESE segments, Union Public Service Commission (UPSC) test preparation platform Coursavy, and Mumbai-based competitive programming platform CodeChef.
Unacademy’s founder Gaurav Munjal, in an interview with the Mint, said, “In 90% of the cases, I am looking for a team or a particularly unique selling proposition that they have, but we don’t.”
He also cited an example of WiFiStudy, a Jaipur-based YouTube channel which gave test prep tips and material. Unacademy acquired WiFiStudy since the startup knew how to scale up on YouTube. “So we got them and learnt the insights and using that, we launched many more YouTube channels. We have built a strategy where we now do more than 200 million video views a month on YouTube on core education content.”, he added.
Unacademy’s Roadmap To IPO
Founded in 2015 by Munjal, Hemesh Singh, Roman Saini and Sachin Gupta, Unacademy claims to have 40 Mn registered users and around 3,50,000 paying subscribers. The startup claims that its user base is very high in Tier II and Tier III for both Unacademy and Mastree. He noted that 70% of their user base comes from small towns.
Munjal also spoke about the company’s plans to go public in the long-run. However, he emphasised that the company will be focusing on turning cash flow positive in 2021 and will continue to invest to gain a larger market share.
It is important to note that the company reported a 4x increase in its revenue in FY2020 to INR 86 Cr. Besides this, it also recorded a 3.4x increase in expenses to INR 386.7 Cr, leading to a net loss of INR 112 Cr.
The company now wants to focus on building a sustainably profitable business and look at a successful IPO over the next 5-6 years. Unacademy claims that it is not burning a lot of money and has seen encouraging revenue rate so there’s no need to bring in more external funding, the CEO said, but added that if the right investor comes along, then it’s a different matter.
“We have close to $300 million in the bank right now. We are not burning a lot of money, we have a huge run rate but at some point, if we have to add the right investor to the cap table, then we would surely do that. For example, the last fundraise that Tiger Global led, we had the option to raise 2X the amount we ended up raising, but we didn’t take more money. We wanted them because they are good investors to have on the cap table,” Munjal added.
