Education technology start-up Unacademy is in talks to raise fresh round of funding from Japanese investment giant SoftBank. SoftBank, that owns stakes in many technology, energy, and financial companies, is planning to lead an investment of $150-200 million in Unacademy, valuing the company at $1.2 billion pre-money, according to a Moneycontrol report.
The Facebook-backed start-up is eyeing to enter the coveted unicorn club with the investment from SoftBank. Unacademy's rival Byju's, owned by Think and Learn Pvt Ltd, is the only other education tech start-up among India's unicorns with a valuation of over $1 billion.
"Investors are seeing Unacademy as the next big thing after Byju's, and it has the potential to build a large outcome. Test preparation for competitive exams is a large market and during this pandemic, ed-tech is one of the few sectors investors can bet on," the business news portal quoted a person close to the company as saying.
As per the report, Unacademy is expected to close the transaction in the next few weeks, and although other late-stage technology funds are interested and vying for a stake, SoftBank is the frontrunner to secure the deal. The existing investors may also participate in the round, it said.
The fresh funding bid comes less than five months after Unacademy raised $110 million in a financing round spearheaded by Facebook and New York-headquartered private equity firm General Atlantic, which are the existing investors in the online platform. Unacademy boasts of the likes of Blume Ventures, Nexus Venture Partners, Steadview Capital, Sequoia Capital, Flipkart CEO Kalyan Krishnamurthy, and co-founder of B2B e-commerce platform Udaan Sujeet Kumar among its list of investors.
In June 2019, it had raised $50 million in a Series D round of funding led by hedge fund Steadview Capital, along with some existing investors.
The five-year-old start-up, run by Sorting Hat Technologies Pvt. Ltd, was founded by Gaurav Munjal, Roman Saini and Hemesh Singh. It reportedly posted a net loss of Rs 90 crore against total revenue of Rs 11.6 crore in FY19.
By Chitranjan Kumar
Copyright©2022 Living Media India Limited. For reprint rights: Syndications Today