[What The Financials] Unacademy Revenue Surge 4x In FY20 But Losses Persist

Edtech giant Unacademy has grown immensely in 2020 along with the rest of the online learning and test prep market, and along the way also became the leading M&A player in the country with six acquisitions in the year. But while 2020 brought it plenty of growth, the company would need to improve its spending considerably to pull back the losses seen in fiscal year 2020, the year ending March 31, 2020.

For FY20, the startup recorded a 4x increase in revenue from INR 21.8 Cr in FY2019 to INR 86 Cr in FY2020. But it also reported a 3.4x increase in its expenses to INR 386.7 Cr, leading to a net loss of INR 300 Cr. In comparison, the company reported INR 112 Cr in expenses and INR 90 Cr net loss in FY2019.

Breaking down the revenue, income from operations grew significantly at nearly 6x from INR 11.6 Cr to INR 64.8 Cr in the year. Other income doubled from FY2019 to INR 21.1 Cr in FY2020. In early 2020, Unacademy founder and CEO Gaurav Munjal had said that the company has more than 90K active subscribers and the Plus subscription for the company has recorded $30 Mn ARR.

In terms of expenses, Unacademy spent the most (23.7%) on employee benefits costs at or INR 91.7 Cr. Besides this, an additional 75% was spent on other expenses. The Bengaluru-based edtech giant spent about 38% or INR 42.8 Cr on employee benefits and 60.7% or INR 68 Cr on other expenses in FY2019.

Founded in 2015 by Gaurav Munjal, Hemesh Singh, Roman Saini and Sachin Gupta, Unacademy focuses on the K12 segment and also offers lessons for competitive exams preparation. In recent times, it has also begun offering lessons on skill development and chess. The company claims to have more than 3,50,000 paying subscribers, and 40 Mn users.

In December 2020, the startup acquired Delhi NCR-based NeoStencil to offer test prep courses for entrance examinations, government jobs, law exams and more.  Unacademy Group CEO and founder Munjal said, “NeoStencil offers 500+ courses to millions of students. And we believe together we can create a huge impact and build products that help our Learners crack their goals.”

Besides this, the company also acquired postgraduate medical entrance exam preparation platform PrepLadder for $50 Mn, K12 learning platform Mastree for $5 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 has raised about $248.5 Mn till date. It last raised more than $150 Mn from SoftBank, Tiger Global Management, Dragoneer Investment Group and others reaching $2 Bn valuation. It had last raised $110 Mn in a Series E round from Facebook and others. .

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