While the coronavirus pandemic impacted several sectors and strained the economy, it helped
fast track the growth of online learning. With schools and colleges closed due to lockdown,
students turned to their mobile phones for their education. This gave a boost to companies
like Byju's, Unacademy, Upgrad, Vedantu and WhiteHat Jr. Even before the pandemic, they were growing steadily, but 2020 was the year where they finally hit the pot of gold.
Edtech in India
Take a look at the numbers and you'll be amazed. In 2020 alone, Byju's raised more than $1 billion in equity funding. It was valued at $6 billion at the end of 2019. After 2020, that
2020, they had 45 million users and 3.5 million paid subscribers. In just the next few months,
they reached 70 million users and 4.7 million paid subscribers.
As per a report by Indian Private Equity and Venture Capital Association and PGA Labs,
investments in the edtech sector saw a growth of 300% and the top firms raised close to $2.22
billion in 2020. These numbers might seem big, but sky is the limit for these firms as the
education market in India (including offline establishments) is worth close to $117 billion.
In order to attract more users, edtech firms have increased their marketing expenditure and
companies like Byju's Upgrad, WhiteHat Jr. have become household names. Their
aggressive marketing strategy means their ads are impossible to miss. Whether it is cricket
matches, TV shows or news channels, Byju’s is likely to find these ads everywhere.
How much money are they spending on marketing?
Till 2022, Byju's will be the main shirt sponsor for the Indian cricket team. To do this, they have taken over from mobile company Oppo at a staggering cost of Rs. 1,079 crore. Additionally,according to a report in Livemint, edtech firms spent close to Rs. 500 crore in 2020 alone on advertising with Byju's leading the pack. While these may seem intimidating numbers, it is not too much when you look at their revenues. In fact, in an interview with exchange4media, WhiteHat Jr’s founder Karan Bajaj said, "I see cost as a percentage of revenue and the marketing cost has actually gone down.
The increase in spending is disproportionate to the increase in revenue." The company which teaches coding for kids was acquired by Byju's in a $300 million deal last year.
In the coming years, these companies are poised to grow even more with online learning
becoming the norm and not just a trend.