Startup Street: BYJU’s Inches Closer To Profitability
This week on Startup Street, how more products and farther reach helped India’s first edtech unicorn to cut its loss by almost 75 percent. Microsoft’s accelerator initiative turned keen on South Asian startups during the year. And Facebook bought a startup that will help ramp up its shopping feature. Here’s what went on...
BYJU’s Loss Narrows In FY19
Think & Learn Pvt. Ltd., parent of online education startup BYJU’s, pared its losses in the financial year ended March, owing to greater penetration across India and increase in the number of paid subscribers.
The nation’s first educational technology unicorn reported a consolidated loss of Rs 8.82 crore 2018-19 compared with a loss of Rs 37.15 crore in the preceding year, regulatory documents filed with the Ministry of Corporate Affairs showed. On a standalone basis, the company, however, made a profit of Rs 20.16 crore during the period.
“We have exceeded our financial goals that we set at the beginning of the year,” Mrinal Mohit, chief operating officer at BYJU’s, said in a media statement. “Expanding our base across smaller towns and cities and introducing new products have been pivotal to our growth.”
The company’s revenue more than doubled year-on-year to Rs 1,306 crore in the fiscal ended March 2019. It’s spending, too, rose in line with the top line. Expenditure during the period stood at Rs 1,366 crore, a 173-percent growth from last year.
BYJU’s was also able to reduce its indebtedness by 28 percent to Rs 5.6 crore.
Mohit remains confident that the coming year will be even better for BYJU’s. The startup, founded by tutor Byju Raveendran in 2011, started offering courses for young learners from classes 1-3 this year. It now offers coaching for up to grade 12 students.
We will also be launching BYJU’S online tutoring which will further accelerate growth and profitability in the coming year.Mrinal Mohit, Chief Operating Officer, BYJU’s
The edtech platform also invested heavily towards promotional campaigns. In 2019, it hired Bollywood superstar Shahrukh Khan as its brand ambassador for a series of advertisements. The company replaced Chinese smartphone maker Oppo as the lead sponsor for the Indian cricket team.
BYJU’s has more than four crore registered users. Of these, almost 28 lakh subscribers pay for their service. It operates learning apps for school students and test preparation services for competitive exams such as JEE, NEET, IAS, CAT, among others, in English and Hindi. It also has plans to launch products in regional languages.
The startup, which raised over $900 million in 12 funding rounds from investors, including Chan Zuckerberg Initiative, Sequoia Capital India, Naspers and Tencent, is now poised to benefit as investors warm up to edtech in the country. The edtech sector attracted private equity and venture capital investments worth $742 million in 2018, a year-on-year rise of 733 percent, according to a new report by EY India.
“As we step into 2020, we will take a global leap, all driven by the mission to keep learning and encouraging the younger generations to do the same,” Mohit said.
Microsoft ScaleUp Extends Support To 18 Startups
Microsoft ScaleUp has extended support to 18 startups in South Asian region over the last 12 months.
A part of Microsoft for Startups initiative, Microsoft ScaleUp provides startups access to world-class technology, mentorship and other community benefits that further their expansion on a global scale, the company said in a statement.
The selected startups in the region are focused on areas of fintech, blockchain, health-tech and internet of things, among others, the statement said. The programme—spanning eight to 12 months—is designed to help selected startups explore emerging technologies, tap into newer markets, regularly engage with industry experts and leverage the Microsoft Partner Network for business growth, it said.
“All the participating startups are well on their product development journey and are gearing up for Microsoft’s co-sell programme,” it said.
Globally, the success story of the startup ecosystem in the region is drawing great attention, said Lathika Pai, country head, Microsoft for Startups in Middle-East, North Africa and South Asia. The programme has shaped several startups in their journey to being “enterprise-ready”, Pai said.
Facebook’s New Buy For A Live Shopping Feature
Facebook Inc. acquired a tiny startup earlier this year that will help build a live shopping feature inside the company’s Marketplace product, Bloomberg reported citing a person familiar with the matter.
The Mark Zuckerberg-led social media giant bought Packagd, founded by Eric Feng, former partner with Kleiner Perkins Caufeld & Byers. Most of the startup’s team joined Facebook in September, according to the report.
The five-member team is working on a project for Marketplace, which would let users make purchases while watching live video broadcasts. Facebook tested a similar product a year ago in Thailand, though that effort didn’t include a way to buy merchandise directly from the video and has been shut down, a person familiar with the matter told Bloomberg.
A Facebook spokeswoman confirmed the development. “As we’ve shared in the past, we’re exploring ways to let buyers easily ask questions and place orders within a live video broadcast,” she said in a statement.
(With inputs from PTI.)