SUMMARY
Deeksha is one of the leading test preparation platforms in Karnataka for board and competitive exams that coaches students of class 11th and 12th
Through the acquisition, Vedantu is looking to leverage its technology and integrate it into offline centres to create a scalable hybrid model, especially in Tier 3, 4 towns
The edtech platform laid off over 700 employees earlier this year as part of its cost-cutting measures
Edtech unicorn vedantu
on Thursday (October 13) said it has acquired a majority stake in Karnataka-based test preparation platform Deeksha (Ace Creative Learning) for $40 Mn to further strengthen its offline presence.
Through this partnership, Vedantu is looking to leverage its technology and integrate it into offline centres to create a scalable hybrid model, especially in Tier 3, 4 towns.
On the other hand, the partnership would further support Deeksha’s learning model that specialises in competitive exam prep through collaboration with schools and colleges, Vedantu said in a statement.
“With this acquisition, our mission is to empower and scale Deeksha’s current learning model by deploying our disruptive in-house hybrid technology to reach the masses in remote areas and create impact at scale. This culmination of online and offline capabilities will help us expand our hybrid learning initiatives,” Vedantu CEO and cofounder Vamsi Krishna said.
With this strategic investment, Deeksha is expected to introduce about 13K of its students to Vedantu’s platform. The test prep platform will also leverage Vedantu’s already existing strong credentials in ‘LIVE’ Classes, educational technology, and strong pedagogical content.
Deeksha is one of the leading test preparation platforms in Karnataka for board and competitive exams that coaches students of class 11th and 12th. It claims to have over 65,000 success stories in the country since 1998, created through its 39 centres across 3 states.
“Vedantu’s hybrid learning model will also enable us to provide the same “Deeksha Experience” to millions of students in smaller towns and cities at an affordable cost,” said Dr Sridhar, cofounder of Deeksha.
Founded in 2014 by Krishna, Anand Prakash, and Pulkit Jain, Vedantu is an interactive online tutoring platform offering individual and group classes across K-12 and test preparation segments. The startup claims to have over 1 Mn students attending its LIVE classes every month on its platform.
Besides, Vedantu says that over 35 Mn users from more than 10,000 cities across over 50 countries access the free content, tests, and videos on its platform and channels on YouTube every month.
Vedantu’s multi-million dollar investment at Deeksha comes at a time when the startup has been aggressively laying off employees as part of its business restructuring process.
Inc42 exclusively reported that the Tiger Global-backed edtech startup laid off over 100 employees, across departments, in July. It was preceded by a mass layoff of 650 employees in 2022 itself. The startup has fired a total of 724 employees this year so far, as per Inc42’s layoff tracker.
The layoffs were largely deemed as a cost-cutting measure. After all, it happened at a time when the overall edtech ecosystem is in trouble. The reopening of schools and offline coaching centres post the Covid-19 lockdowns has led to a sharp decline in the number of students using edtech platforms. Besides, the ongoing funding winter has made it difficult for startups to raise fresh funding.
From BYJU’S to Unacademy to Toppr, several edtech majors have been on an employee firing spree. On Wednesday, BYJU’S said it would lay off 2,500 employees to attain profitability by the end of the ongoing financial year, while it was reported on the same day that celebrity-focused learning startup FrontRow has laid off 125-130 employees.
In total, Indian edtech startups have laid off over 6,800 employees in 2022 so far.
While Vedantu is yet to report its financial statements for FY22, the startup’s loss widened more than 4X to INR 601.2 Cr in FY21 with a total revenue increase of 276% to INR 134.9 Cr. Its total expenses also grew almost 4X to INR 736 Cr in the same fiscal year.
However, like several of its peers, Vedantu too is now looking to strengthen its fundamentals by expanding its offline presence, and the acquisition of Deeksha is another clear indication of the same.
Earlier today, Veranda Learning also announced acquiring coaching institute JK Shah Classes, while PhysicsWallah said it has acquired PrepOnline and Altis Vortex.
Despite the recent slump, the Indian edtech market is estimated to grow 3.7X to $10.4 Bn in 2025 from $2.8 Bn in 2020, as per an Inc42 analysis.
