Education technology start-up Unacademy is finalising a deal to raise around $150 million led by Japanese investment giant SoftBank.
This will further boost the startup's pre-money valuation to $1.3 billion, second only to Byju's, which recently raised capital from Mary Meeker's Bond Capital at a valuation of $10.5 billion, the Economic Times reported.
The ed-tech startup's funding comes on the back of its strong growth caused by a spike in the number of online learners in the country due to the coronavirus pandemic. Unacademy claims to have garnered more than 2 lakh subscribers, compared to 90,000 in February, which resulted in an 80 per cent growth in revenues in April.
The fundraising will also be significant as it will mark the first fresh investment by SoftBank in a domestic firm since it backed Lenskart in December last year. Unacademy last raised $110 million from tech-giant Facebook and PE firm General Atlantic in February this year, at a valuation of $510 million.
The company's existing investors will participate in Unacademy's latest funding round but didn't share exact details, sources told the publication. Sequoia Capital, Blume Venture, Steadview Capital and Nexus Venture Partners have been early backers of the firm.
Unacademy will also pip rival Vedantu, whose valuation had risen to $600 million after it raised $100 million led by Coatue Management. Ed-tech is one of the few Internet sectors that have benefitted from the coronavirus pandemic, with major players like - Byju's, Unacademy, Vedantu, WhiteHat Jr. in the fray. Even after the passing of the pandemic, these ed-tech firms are hopeful of higher retention of online learners.
SoftBank Vision Fund CEO Rajeev Misra, in April 2020, said that the firm was looking to make around 15-20 investments over the next three months and was actively scouting for investments in India. The potential funding from SoftBank is likely to come after Unacademy saw a spike in online learners amid the Covid-19 outbreak.