The country’s biggest ed-tech firm, Byju’s is in sophisticated stages of talks to obtain rival, Toppr, market sources stated, indicating the transaction could be about $150 million. Byju’s most recent acquisition target underlines its aggressive expansion at a time when on line understanding is catching on.
Byju’s and Toppr did not respond to FE’s queries with regards to the proposed transaction till the time of going to press.
If the deal goes by way of, Byju’s will get access to Toppr’s base of subscribers and associated user information. “In the digital space, it is largely about economies of scale. A lot of the business model will depend on the analytics which comes from the data they have,” stated Anindya Mallick, companion at Deloitte.
Byju’s can use the information to launch more relevant merchandise and tailor the current ones to cater to the marketplace greater. “The organisation which has access to data, can predict where the market will be going in the future and have products and services around that will be the ones that will be the clear winner,” Mallick stated.
Mumbai-based Toppr services the K-12 and test preparation marketplace. It claims to have 35 million month-to-month active customers. Byju’s might also have a want to leverage what Toppr is attempting to do with schools, stated an market specialist on situation of anonymity. The corporation, for instance, has created the Toppr School OS app that aggregates all college content on one platform, equipping authorities to bring their schools on line.
Consolidation in the ed-tech space is most likely to continue, stated Ankur Pahwa, companion at EY. Companies will look at acquisitions to either add more courses so that they can make on their portfolio of offerings or to incorporate an omni-channel strategy. Geographical expansion is a different location that firms take into consideration though generating acquisitions, stated Pahwa.
Flush with funds, Byju’s is also reportedly inking a deal to obtain brick and mortar test preparation corporation Aakash Educational Services in a whopping $1-billion deal. Last year, the Bengaluru-based corporation had acquired WhiteHat Jr in a $300-million transaction.
Last year, investors infused more than $1 billion in Byju’s valuing the firm at more than $11 billion. In all, the firm has raised close to $2 billion. The company’s revenues have grown at a compounded 125% more than the previous 3 years to roughly $400 million.
“It is not about the content or curriculum. The opportunity is in terms of innovating on how we personalise this content in the way it is delivered to students. We can also innovate on the format…It has to be content first and technology as an enabler approach,” founder & CEO Byju Raveendran told FE in an interview final year.
Experts point out edtech is increasing on the back of adjustments in the strategy to education and the fast rise in the use of smartphones. Of the 3 broad categories — K-12 supplementary teaching for grades 1-12, test-preparation and larger education — analysts at HSBC reckon K12 presents the most possible.