While browsing through online tutoring platform Vedantu, 22-year-old Natasha came across a live class on 'How to write Marvel-style comic books'. There were quizzes and interactive games, including some 'fastest fingers first' questions that would give anyone an adrenaline rush. The class of 584 did not feel a bit overcrowded. Students could send in their comments on the 'public chat' forum option. The instructor addressed all queries, and even welcomed 'late joiners'. Natasha had fun posing as a 15- year-old, and the acknowledgement served as an incentive to finish the lesson.
India's ed-tech space is dominated by players such as Byju's, Vedantu, Toppr, Unacademy, White Hat Jr, Great Learning and Coursera, all of whom are seeing phenomenal growth. With schools and colleges shut during the lockdown and around 320 million students facing the heat, ed-tech platforms made their offerings free for students. The result: Prospects of fresh revenue streams emerging from new business models.
Vedantu saw a 220 per cent increase in the number of registered students - from 2.5 lakh to 8 lakh - in the last three months, compared to the regular growth rate of 25-30 per cent per quarter. Byjus' revenue doubled from what it was before the lockdown. Toppr saw a 150 per cent growth in new, paid users in April and May, and is still adding 1 million users every month even though exams are over. WhiteHat Jr, which teaches coding to kids between 6 and 14 years, was growing at 40 per cent month-on-month over the last one year, the lockdown boosted it to 100 per cent. Board Infinity, a career and ed-tech start-up, clocked a revenue growth of 400 per cent in FY2020 against the previous fiscal. In fact, it recorded its highest growth rate of 30 per cent in monthly revenue during the lockdown period (April and May), compared to March. Coursera added over 2.6 million learners in India in the last five months, against 1.4 million in all of 2019.
"While ed-tech has been there for over a decade, Covid has increased awareness about the category," says Vamsi Krishna, CEO and Co-founder, Vedantu. In fact, while earlier 85 per cent of its students were from tier 2 and tier 3 cities, post-Covid they are seeing traction from metros as well.
Byju's, India's second-most valuable start-up, which focuses on educational content in the K-12 segment, has made all its content free on the learning app. The result: It added 15 million new students in the last three months. It clocked Rs 375 crore in revenue in May and is looking at Rs 500 crore in June. "Our revenue is double of what it was before the lockdown. Given the positive response, we are looking at revising our yearly target on the higher side," says Co-founder Divya Gokulnath. Byju's has over 57 million registered students, of which 3.5 million are paid subscribers, with an annual renewal rate of 85 per cent.
Blume Ventures estimates by 2025, the ed-tech market in India should grow 5x to $4 billion, from the current $750 million. "The market is highly segmented, but the biggest opportunity lies in the unregulated space," says Sajith Pai, Director, Blume Ventures. According to Pai, the ed-tech market can be divided into two broad categories: firms that operate in the regulated space (where accreditation, curriculum, fees etc is regulated by the government), and those that are outside its purview such as online tuitions, test prep portals etc. While regulations in the formal sector make it difficult to start an online business, ancillary education offers the biggest opportunity. According to Pai, online tutoring and test prep is set to be a $1.5-billion opportunity in India by 2025.
Ed-tech firms are foraying into new verticals to address demand. For instance, in addition to the usual course-based classes, Vedantu has launched Vedantu Superkids, which conducts live classes for students on coding.
Byju's, too, is offering personalised online coaching and venturing deeper into vernaculars. "Since students were missing a schedule in their learning, we introduced LIVE classes to bring scheduled engagement to students everyday learning routine," says Byju's Gokulnath. These are scheduled classes for doubt solving, where students get one-on-one guidance. They have also started teaching new subjects such as history, civics and geography, and are working to launch lessons in other vernacular languages as well. Currently, the learning material is available in English and Hindi.
Ed-tech firm Great Learning, which focuses on professional learning has ventured into two spaces - SaaS service and core education. The seven-year-old Gurugram-based company will launch a three-year online undergraduate programme in the next two-three months in partnership with other universities. "The partnership will be with progressive and like-minded universities that are ready to take the leap," says Co-founder and CEO Mohan Lakhamraju. The firm is adding 10,000 students every two days.
These will be three-year programmes and will be offered online only or through the blended model (a combination of online lectures and classroom teaching). The percentage of online and offline will depend on the nature of the programme, says Lakhamraju. The firm first plans to launch courses in 'hard' disciplines such as business, finance, commerce, maths, economics and technology-related undergraduate degree programmes, and then follow it up with programmes in allied health science, law and humanities.
The Changing Scenario
"I don't expect things to go 100 per cent online or offline. With teachers now understanding the advantages of online learning tools, we will see tech-enabled learning gain importance even in a classroom setting. The 'Classrooms of Tomorrow' will have technology at its core, empowering students to cross over from passive to active learning -from the traditional one-to-many approach to blended one-on-one learning experiences," says Byju's Gokulnath.
This is where the next big opportunity is. Firms are now offering their digital platforms or online content to traditional universities. In March, Coursera granted free access (till July 31) to its 3,800 courses and 400 specialisations for all universities and colleges through its 'Coursera for Campus' offering. By January, 30 universities entered into paid partnerships with Coursera.
Since March 12, says Raghav Gupta, Managing Director, India and APAC, Coursera, "We have received over 10,900 requests and 3,765 programmes have been activated across campuses." Some of those include Symbiosis Institute of Technology, World University of Design, BML Munjal University, National Rail and Transportation Institute.
Great Learning, too, turned to a SaaS firm by opening up its technology platform, Olympus Digital Campus, to universities and institutions on a subscription basis. The platform is not just about delivering live lectures, but bringing the entire institution online. It supports live learning, proctored exams, smart timetables, assessments, grading, peer collaborations, content development, student progress tracking / engagement, and faculty feedback. It offers administration management - from course and batch planning to preparing marksheets and certificates, tracking attendance and recording student feedback. Through Olympus, Great Learning has already delivered 25 million hours of learning for 100,000-plus learners from 80 countries.
Schools, too, are looking for similar solutions where they can move seamlessly between physical and digital learning. Toppr CEO Zishaan Hayath says they have been getting frequent queries from schools on technology platforms for learning and will be offering the SaaS product soon.
According to Beas Dev Ralhan, Co-founder-CEO of Next Education, the company is focussing on its Next Learning Platform, so that schools can move seamlessly between offline and online learning. The platform will help digitise offline classes and live stream content for remote learners. Ralhan says while they had launched the platform last year, schools would buy only parts of the product. "We are now getting inquiries for the full platform as it has become a matter of continuity and existence for schools." The firm plans to onboard 1,000 schools by FY21 end.
No wonder then while most sectors are planning their revival strategies, ed-tech is raising venture capital investments. In June 2020 Byju's announced a new investment from Silicon Valley investor Mary Meeker's fund, Bond, at a valuation of $10.5 billion, making the online learning company India's second-most valuable start-up after Paytm. In February 2020, Unacademy, which focusses on preparing students for competitive exams online, raised $110 million from Facebook and private equity firm General Atlantic, at a valuation of $510 million.
The next move for these ed-tech firms would be to retain consumers and convert them into paying subscribers.