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May 27, 2021

An army of Indian edtech vendors are getting stronger

By GlobalData Thematic Research

India’s edtech market received a significant boost, when the second-most populous country in the world, with more than 650 million people below the age of 25, went into lockdown in March 2020 due to Covid-19.

Millions of students were forced to learn from home, making online education a priority. The Indian government took steps to support this shift, emphasizing online and digital education in the 2020 National Education Policy.

India’s edtech companies stand tall

India has the world’s second-largest edtech market, behind the US. According to the India Brand Equity Foundation (IBEF), the Indian edtech market will be worth $3.5bn in 2022. Start-ups dominate the industry. The IBEF revealed that Indian edtech start-ups received $2.2bn in investment during 2020, up from $0.5bn in 2019.

Byju’s, the biggest Indian edtech vendor, is also the biggest edtech start-up globally. It has a valuation of $16.5bn and total funding of $2.3bn. It has benefitted from the pandemic-induced lockdown, adding more than 25 million new students to its platform between March 2020 and September 2020. As of April 2021, it had 80 million registered users and 5.5 million subscribers.

The next big player in India is Unacademy, which became a unicorn in 2020 with a $2bn valuation. The pandemic also benefited other start-ups, including Upgrad, Flintobox, Splashlearn, Toppr, Cuemath, and Vedantu.

India’s start-ups are diversifying and expanding into new markets

India’s edtech start-ups are using the influx of funding to support inorganic growth. There has been increased M&A activity in 2020 and 2021. Since August 2020, Byju’s has acquired Aakash Educational Services (which operated physical coaching centers), WhiteHat Jr (a developer of coding platforms for children), Toppr (an online platform for the preparation of competitive exams), and Scholr (a provider of AI-based personal learning assistance). Byju’s is also actively expanding in other geographies. It already offers its products in the US and is set to launch in Brazil, Indonesia, and Mexico later this year.

Between January 2020 and the end of May 2021, Unacademy bought CodeChef (a provider of online coding platform), TapChief (an online platform for freelance work), and Mastree (an online public speaking platform for children). It has also purchased PrepLadder, NeoStencil, Coursavy, and Kreatryx, which all offer online platforms to prepare competitive exams. Upgrad, another start-up, has also been on a spending spree, acquiring Impartus (an online video learning platform), Rekrut (online staffing solutions), and Gate Academy (which operates physical coaching centers).

We expect further consolidation in the market. The big players will continue to acquire smaller rivals to fill gaps in their portfolios or add scale amid a surge in demand for remote learning. These acquisitions in the edtech space should improve India’s education ecosystem and benefit both end-users and edtech players.