Controversies, astounding sales figures and what not, the Byju’s edtech juggernaut is continuing to roll on. While already the world’s biggest edtech company by a large margin, Byju’s is in the news today, amid reports that it has signed a deal to acquire New Delhi-based Aakash Educational Services Ltd. for $1 billion, Bloomberg said on January 12.
Founded in 1988, Blackstone Group-backed Aakash Educational Services runs Aakash Institute, a well-known chain of coaching centers that train students to enter elite engineering and medical colleges. Its student count is over 250,000, according to its own website. Aakash, by all means, is the largest brick and mortar test preparation chain of its kind in India.
In this reported deal with Byju’s, Aakash’s founders — the Chaudhry family — will exit the company completely. On the other hand Blackstone, which last flushed in $500 million into Aakash in late 2019, will swap a portion of its 37.5% equity in the coaching center for the pricey Byju’s stake.
For Byju’s this means further stronghold on India’s education sector, wherein it already has a massively commanding league in the digital space. The deal is sure to raise eyebrows considering how a movement to control Byju’s dominance is already on the rise. This new acquisition will help Byju’s move further with its goal of adding graduate and undergraduate courses on its platform, thanks to Aakash’s experience in the industry.
Ever since the COVID 19 pandemic hit India, the ed-tech market of the country has seen a massive boom, with many companies seeking to raise huge capital to fuel this new growth. Byju’s, the world’s biggest ed tech startup, was one of them, and raised money from Silver Lake, DST Global, Bond, General Atlantic and Tiger Global, among others. Overall, the startup raised over $800 million in the past two years, and more than doubled its valuation to over $11 billion
The company also started offering free services on its app for students in early March, to cope with school closings. Moreover, it also acquired WhiteHat Jr, a platform that aims to teach coding to kids at an early age, for $300 million, to expand its offerings.
Thanks to all these efforts, Byju’s user base saw a huge rise, attracting tens of millions of students to its platform. Today, the app has over 70 million registered students and 4.5 million annual paid subscriptions. Of these, over 4.5 million are paid users.
On the other hand, offline tutoring has taken a huge hit from the pandemic, and thus, being acquired is probably the best route for Aakash.