PhysicsWallah, the Indian edtech unicorn, has gobbled up $210 million in a Series B funding round. The funding, led by Hornbill Capital and Lightspeed Venture Partners, also saw the participation of existing investors like GSV Ventures and WestBridge Capital.
With this fresh infusion of capital, PhysicsWallah’s valuation has surged to $2.8 billion, marking a significant leap from its previous $1.1 billion valuation achieved just two years ago. This successful funding round arrives at a time when the edtech landscape in India faces considerable uncertainty, primarily driven by the decline of major players such as Byju’s, which has seen a sharp drop in investor confidence and financial struggles, staring at bankruptcy.
One of the primary goals for PhysicsWallah in utilizing this capital is to expand its offline presence across India. Initially known for its digital platforms, the company has increasingly invested in offline and hybrid learning centers, a strategic move that has proven to be a key revenue driver. To date, the company has invested close to ₹400 crore in the development of these centers, including its flagship ventures Vidyapeeth and Pathshala.
The company plans to allocate an additional ₹70 to ₹100 crore over the next year to further its offline expansion. By opening 50 new centers across key cities like Pune, Dehradun, Chennai, and Coimbatore, PhysicsWallah aims to make quality education more accessible to students in second-tier cities and rural areas, where access to high-quality test preparation services is often limited.
In addition to expanding its offline footprint, PhysicsWallah is also keen on growing through acquisitions. Co-founder Prateek Maheshwari emphasized the importance of having a financial reserve to capitalize on any potential inorganic growth opportunities that may arise. This is part of the company’s broader plan to strengthen its position in the highly competitive K-12 and test preparation markets by acquiring smaller, specialized educational platforms. PhysicsWallah has already made several notable acquisitions, including FreeCo, iNeuron, Only IAS, and Utkarsh Classes. The new funding will allow the company to further explore opportunities, particularly in regions where their market presence is still nascent.
Currently, PhysicsWallah is able to balance both online and offline education. While the company initially gained traction through its popular YouTube channels and digital courses, it now generates 45% of its revenue through offline centers. This hybrid model has proven to be especially effective in addressing the diverse needs of students across India. In FY23, PhysicsWallah reported a threefold increase in its operating revenue, which reached ₹772 crore. This growth was largely attributed to the rapid expansion of its offline centers – a decision that paid off and allowed the company to cater to a wider demographic of students who prefer the structure and accountability of in-person classes. Maheshwari stated that the company’s revenue in FY24 has already grown 2.5 times compared to the previous year, and they expect FY25 to be their most profitable year yet in terms of EBITDA.
