PC: Moneycontrol
It is given that the edtech space is changing at a very high rate, and Bengaluru-based unicorn Vedantu has thus raised the debt and equity capital in a funding round worth Rs 19.25 crore, which is almost $2.3 million, from Stride Ventures. This is the latest development for Vedantu, which had earlier raised $100 million in funding that took its valuation to around $1.1 billion.
According to regulatory filings obtained from the Registrar of Companies, Vedantu has raised Rs 19.25 crore from Stride Ventures Debt Fund II, issued 1,750 non-convertible debentures with a value of Rs 17.5 crore and Rs 1.75 crore in equity. Although the funding amount may not be too large, it helps the company build its financial runway in challenging the circumstances presented by the edtech sector. Therefore, Vedantu is well-positioned to observe consistent growth and buoyancy in a challenging market environment.
As of March 2023, the company’s net current asset stood at Rs 299 crore, which included cash balance of Rs 39 crore as per TheKredible. This financial strength coupled with recent funding infusion sets an example as to how Vedantu has been prudent with strategic foresight and flawless operational competence in today’s dynamic edtech landscape.
In a challenging funding climate for edtech players, Vedantu’s latest fund raise stands apart as a testimony to its investor appeal and growth prospects. Industry peers such as Unacademy, Cuemath, and Classplus have faced challenges in accessing capital over the last few years, which underlines the competitive yet dynamic nature of the space.
In a strategic move towards expanding its offerings and market presence, Vedantu has proposed to acquire complete control of Ahmedabad-based pedagogy by buying the remaining 9.32% in the company through a share swap deal. Their vision at Vedantu is to increase its knowledge resources and strengthen its positioning within the ed-tech ecosystem, catering to varying needs and preferences for learning.
It is known for bringing popular books and digital courses from renowned publishers and coaching centers that can be taken by students to prepare for different entrance exams named JEE, NEET, NET, and CTET. It will go well with the existing portfolio of Vedantu and spread its reach in a segment that covers competitive exams.
In a strategic diversification play, Vedantu has made an offline foray by partnering with Vignan Institute and creating six learning centers for high schools in Andhra Pradesh and Telangana. The expansion drive fits into Vedantu’s omnichannel model of reaching out to different learning needs and enhancing educational accessibility in all regions.
Vedantu has still not declared its FY24 financial numbers. But during FY23, the operating revenue at the company had declined by 7.8% to Rs 153 crore. On the other hand, cost management was one of the areas where the company was seen taking massive strides for fiscal, bringing down its losses by 46.4% to Rs 373 crore, according to a TheKredible-an intelligence platform for data startups- analysis.
Concluding, recent funding infusion, strategic acquisitions, and diversification initiatives by Vedantu speak to the company’s resilience, innovation, and strategic vision in this extremely competitive edtech landscape. Vedantu would, thus, be well-positioned to leverage both the opportunity and challenge to drive business growth and re-engineer educational experiences across various segments for learners.
