Eruditus Secures $150 Million to Fuel Growth and Shift Focus to India
October 18, 2024, 9:31 pm
In a bold move, Eruditus has raised $150 million in its Series F funding round, led by TPG’s The Rise Fund. This funding marks a significant milestone for the Mumbai-based edtech unicorn, which has seen a rollercoaster of growth and challenges in recent years. The investment comes at a time when the online education sector is navigating a landscape of declining interest and funding, making this round a beacon of hope.
Eruditus, founded in 2010, has established itself as a key player in the global edtech arena. The company partners with over 80 universities worldwide, offering a diverse range of programs from short courses to professional certificates. With a footprint in more than 80 countries, it has educated over a million individuals. The firm’s global reach is complemented by its robust workforce of over 1,750 employees, spread across major cities like New York, London, and Singapore.
The latest funding round is particularly noteworthy as it comes after a three-year hiatus in equity fundraising. The company had previously raised $350 million in debt in March 2022 and a staggering $650 million in equity in August 2021, which catapulted it into the unicorn club. However, the edtech sector has faced a significant downturn since the pandemic, with investment levels plummeting. In 2024, edtech startups have raised only $310 million across 30 deals, a stark contrast to the $5.8 billion raised in 2021.
The fresh capital will be pivotal for Eruditus as it aims to enhance its technological capabilities, particularly in artificial intelligence. The company plans to invest in AI to improve the learner experience and expand its enterprise solutions. This focus on technology is not just a trend; it’s a necessity in a rapidly evolving educational landscape. The demand for upskilling remains robust, and Eruditus is positioning itself to meet this need head-on.
In a strategic shift, Eruditus is relocating its domicile from Singapore to India. This move aligns with a growing trend among Indian startups seeking to list on local stock exchanges. The decision reflects a broader confidence in India’s economic landscape and the potential for growth in the edtech sector. The company plans to file for this “reverse flip” early next year, signaling its commitment to the Indian market.
India is currently the fastest-growing segment for Eruditus, contributing significantly to its revenue. The Asia-Pacific region accounts for about 27-28% of its consolidated revenue, while the US remains its largest market, contributing nearly 40%. The company aims to increase India’s contribution to 40-45% in the coming years. This focus on India is not just about numbers; it’s about tapping into a vast pool of learners eager for quality education.
Financially, Eruditus has shown resilience. In FY23, its revenue from operations surged by 70.39% to Rs 3,343 crore, while losses were reduced by 66.1%. The company achieved EBITDA profitability, a significant milestone that underscores its operational efficiency. For FY24, Eruditus is targeting a 30% revenue growth, aiming for Rs 5,000 crore. This ambitious goal reflects the company’s confidence in its strategic direction and market potential.
The funding round also saw participation from existing investors, including SoftBank Vision Fund 2, Accel, and the Chan Zuckerberg Initiative. TPG’s investment of $100 million came at a slightly lower valuation of $3.1 billion, down from the previous $3.2 billion. This adjustment in valuation is indicative of the broader market conditions affecting the edtech sector.
Eruditus has historically relied on acquisitions to fuel its growth. The company is eyeing opportunities in enterprise solutions and study abroad programs, as well as expanding its offerings in undergraduate and postgraduate degree programs. This strategy of growth through acquisition has proven effective in the past and is likely to continue shaping the company’s trajectory.
As the edtech landscape evolves, Eruditus is not without competition. Rivals like upGrad are also vying for market share, with their own restructuring efforts in response to market pressures. However, Eruditus’s established partnerships and diverse program offerings give it a competitive edge.
In conclusion, Eruditus’s recent funding round is a testament to its resilience and strategic vision. The company is not just weathering the storm; it is positioning itself for future growth. With a focus on technology, a commitment to the Indian market, and a clear path to profitability, Eruditus is set to navigate the complexities of the edtech landscape. The journey ahead may be challenging, but with $150 million in its arsenal, Eruditus is ready to soar.
Eruditus, founded in 2010, has established itself as a key player in the global edtech arena. The company partners with over 80 universities worldwide, offering a diverse range of programs from short courses to professional certificates. With a footprint in more than 80 countries, it has educated over a million individuals. The firm’s global reach is complemented by its robust workforce of over 1,750 employees, spread across major cities like New York, London, and Singapore.
The latest funding round is particularly noteworthy as it comes after a three-year hiatus in equity fundraising. The company had previously raised $350 million in debt in March 2022 and a staggering $650 million in equity in August 2021, which catapulted it into the unicorn club. However, the edtech sector has faced a significant downturn since the pandemic, with investment levels plummeting. In 2024, edtech startups have raised only $310 million across 30 deals, a stark contrast to the $5.8 billion raised in 2021.
The fresh capital will be pivotal for Eruditus as it aims to enhance its technological capabilities, particularly in artificial intelligence. The company plans to invest in AI to improve the learner experience and expand its enterprise solutions. This focus on technology is not just a trend; it’s a necessity in a rapidly evolving educational landscape. The demand for upskilling remains robust, and Eruditus is positioning itself to meet this need head-on.
In a strategic shift, Eruditus is relocating its domicile from Singapore to India. This move aligns with a growing trend among Indian startups seeking to list on local stock exchanges. The decision reflects a broader confidence in India’s economic landscape and the potential for growth in the edtech sector. The company plans to file for this “reverse flip” early next year, signaling its commitment to the Indian market.
India is currently the fastest-growing segment for Eruditus, contributing significantly to its revenue. The Asia-Pacific region accounts for about 27-28% of its consolidated revenue, while the US remains its largest market, contributing nearly 40%. The company aims to increase India’s contribution to 40-45% in the coming years. This focus on India is not just about numbers; it’s about tapping into a vast pool of learners eager for quality education.
Financially, Eruditus has shown resilience. In FY23, its revenue from operations surged by 70.39% to Rs 3,343 crore, while losses were reduced by 66.1%. The company achieved EBITDA profitability, a significant milestone that underscores its operational efficiency. For FY24, Eruditus is targeting a 30% revenue growth, aiming for Rs 5,000 crore. This ambitious goal reflects the company’s confidence in its strategic direction and market potential.
The funding round also saw participation from existing investors, including SoftBank Vision Fund 2, Accel, and the Chan Zuckerberg Initiative. TPG’s investment of $100 million came at a slightly lower valuation of $3.1 billion, down from the previous $3.2 billion. This adjustment in valuation is indicative of the broader market conditions affecting the edtech sector.
Eruditus has historically relied on acquisitions to fuel its growth. The company is eyeing opportunities in enterprise solutions and study abroad programs, as well as expanding its offerings in undergraduate and postgraduate degree programs. This strategy of growth through acquisition has proven effective in the past and is likely to continue shaping the company’s trajectory.
As the edtech landscape evolves, Eruditus is not without competition. Rivals like upGrad are also vying for market share, with their own restructuring efforts in response to market pressures. However, Eruditus’s established partnerships and diverse program offerings give it a competitive edge.
In conclusion, Eruditus’s recent funding round is a testament to its resilience and strategic vision. The company is not just weathering the storm; it is positioning itself for future growth. With a focus on technology, a commitment to the Indian market, and a clear path to profitability, Eruditus is set to navigate the complexities of the edtech landscape. The journey ahead may be challenging, but with $150 million in its arsenal, Eruditus is ready to soar.