At a time when large cheque sizes has taken a backseat, Byju Raveendran’s company BYJU’s has managed to grab eyeballs of investors twice this year. The company, which secured $75 million in funding from marquee investors in March, is currently in talks to raise another $50 million in new rounds of funds.
The funds in Byju’s company is expected to fuel international expansion for the company, which started out as coaching classes for students taking up competitive exams like GRE and CAT.
Teacher and entrepreneur Byju Raveendran was present at Entrepreneur India Summit 2016 last month, where he spoke about the company’s international route.
Talking about the much talked about expansion plans of the company Byju said, “There will be huge focus on continuing to grow inside India itself but from the product development point of view, the capabilities that were built over the years in terms of content, media and tech capabilities, we think it’s also important to be in products that can be big in international markets. So the initial markets which we have indentified are the US, UK and other Common Wealth countries. We have just started marking products in the same segment for those countries where we are bringing in some of the topmost celebrity teachers from those countries, where they will come and does the delivery part for our modes.”
Raising money in tough times
Spilling the beans on what startups need to do to secure funds during a dry phase, Byju said that it’s a function of a solid revenue and profitable model. “Business in India is already profitable and it is 100% our revenue. Product is completely made in-house and the fact that we have been able to acquire students who come on to the annual subscription model and the first sale itself is making it profitable, very high-renewable rate makes it even more attractive. Our business is built on a solid foundation and before launching the product it’s important to have enough products so that you can have good amount of marketing strength.”
“It’s like if you have ten different products which can be taken to the market, it brings down your cost of acquisition by one-tenth. Having enough products in your portfolio, starting from grade four up to grade 12 across multiple subjects is helping us to keep that acquisition cost very low. The fact that we are creating a new segment, I’ve been able to have very high conversion rates on our downloads have excited our investors,” he added.
Has edtech arrived, at last?
Byju said that even though edtech is not a new segment as education is a core segment, tech and internet data is yet to make its real intervention in the education space. “Students are slowly warming up to the idea of learning online. But again, the focus I believe has to be on education first and tech as an enabler then you will be able to make a big impact in terms of how students are adopting tech-enabled learning,” he said.
Byju said that there still exists a challenge in terms of infrastructure around how students can consume content. “Online as such is still at its early stage if you go out of the metros. You got to have a hybrid model where students can consume most of the data offline with online being just for data as well as reports and assessments,” he said.
(With inputs from Sandeep Soni)