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Byju Raveendran: Start-up superhero breaks the bank again

  • After $75 million raised in March, Byju's is once again in the market to raise a whopping $50 million (around ₹325 crore)
  • Byju's learning app, launched in August 2015, has been a game-changer and is now contributing 90% to its earnings
Byjus Start up superhero breaks the bank again
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Bengaluru, First Published Aug 27, 2016, 11:41 AM IST

While the Indian start-up landscape is currently engulfed in chaos as companies are scuttling to get their house in order, educational technology firm Byju's stands out as a rare beacon of hope primarily because it claims that it is profitable - a tall feat that almost none of its other fancier and older contemporaries has managed till now. 

Most of its brethren like Flipkart, Ola, Snapdeal, Zomato, Housing.com are all feeling the heat as investors that had earlier pumped in big monies are demanding returns. As a result these companies are scaling-back operations and indulging in massive retrenchments as 'finally' they all want to be profitable and behave like sensible business ventures.    

 

Byju on the other hand said in a recent statement, the company said its learning app is already profitable in India with a month-on-month growth of 15%. The revenues for June 2016 stood at ₹30 crore. The app has crossed five million downloads, has over two lakh paid subscribers, with 30,000 added in June, 2016. 

 

“We are seeing strong inbound interest from multiple investors over the last few months, thanks to our explosive growth. On the other hand, we are humbled by the rising popularity of our product with 90% annual renewal rates from the students. We are constantly innovating the way in which we make learning accessible, effective, engaging and personalised,” said founder Byju Raveendran in a statement. 

 

Darling of investors: 

 

In February this year, Aarin Capital, the investment vehicle of former Infosys finance chief Mohandas Pai and Manipal Group scion Ranjan Pai, made a more than a 10-fold return on its early investment in Byju's, according to a report in The Economic Times. 

 

The firm sold a 6-7% stake in Byju's to Silicon Valley venture capital firm Lightspeed Venture Partners in February, in a transaction pegged close to ₹150 crore, making it one of the most attractive returns in the venture capital industry this year. 

 

Then in March, Byju's raised $75 million (approximately ₹500 crore) from venture capital firm Sequoia Capital and Belgian investment firm Sofina, making it one of the largest fund-raises in the start-up education segment in India. 

 

Now, Byju's is again in the market to raise a whopping $50 million (around ₹325 crore). One of the new investors lining up is World Bank's International Finance Corporation, which is expected to put in ₹100 crore. 

 

How it works: 

 

According to start-up tracker Tracxn, as many as 271 online education start-ups were founded in 2014, which increased marginally to 293 in 2015. 

 

In 2014, about $28 million was invested in the sector across 32 deals. 

 

In 2015, 47 deals worth $74.7 million were struck. The key education technology players in the Indian market include Simplilearn, Embibe, Toppr and EduKart. 

 

Rising in this crowded field, Byju's was founded with an initial investment of ₹2 lakh by Byju Raveendran. Byju's initially specialised in classroom teaching and then evolved into an educational technology company, with a focus on online operations. 

 

 

Byju's learning app, launched in August 2015, has been a game-changer and is now contributing 90% to its earnings. The app offers original content, watch¬and-learn videos, animations and interactive simulations that help students grasp things easily and in a fun way. 

 

The start-up follows a freemium model - some of the content is offered for free, while students have to pay a fee for advanced levels. The app is now being used by 40 lakh students and, of these, 1.6 lakh are paid subscribers. 

 

Some 25,000 paid users are getting on board every month. The start-up, whose average annual subscription ticket size is ₹10,000, generated a revenue of ₹4 crore in its first year of operation (2011-12). 

 

In just five years, it has witnessed phenomenal growth with revenues rising to ₹120 crore in 2015¬16. Its staff strength has also grown from 10 to 900.  


The man himself: 

 

According to a Hindustan Times report, Raveendran hails from a small village called Azhikode in Kerala’s Kannur District. He studied at a Malayalam-medium school where both his parents were teachers. He plays six different sports, including football, cricket and badminton, at the university level.

 

After school, Raveendran became an engineer and got an IT job. Eventually, he realised that he was a born teacher after helping some friends score well in the CAT exam. 

 

Finally, he launched Byju's and then caught Mohandas Pai's attention and garnered his first investment, thanks to his partner Ranjan Pai, who discovered Raveendran when he gave a lecture at Manipal University.

 

He is passionate about making education accessible and fun for students, especially complex subjects like maths and science. 

 


Following is a collection of things he said in various media interviews that give an insight into his passion and vision. 

 

•    "Online learning is not merely digitising a textbook."

•    "Learning can be made a lot more effective if the technology is used right." 

•    "Our USP is that we make every student fall in love with learning and not focus on just the motivated ones and the toppers." 

•    “We are making an impact where it matters, and how students learn in those crucial years where they start failing (in a) subject, in the 6th or 7th grades. We know we are making a much bigger impact because we are changing the way India is learning today.”

Asianet Newsable sent an email query to the company which remained unanswered.

Images courtesy Guruprasath R 

 

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