New York-based Tiger Global Management has invested $200 million in education app Byju’s, valuing the Bengaluru-headquartered company at about $8 billion.
The investment, in the edtech major Think and Learn, which owns and operates the K-12 learning app, was confirmed by the company, which declined comment on specific details of the transaction.
Tiger Global, one of the most influential investors in the Indian startup ecosystem, has been negotiating an investment in Byju’s for the past few months, said two people aware of the developments. The sources indicated that secondary transactions, estimated at $100-$200 million, may also take place, providing exits to some of the early backers of the eight-year-old company.
“We are happy to partner with a strong investor like Tiger Global Management. They share our sense of purpose and this partnership will advance our long-term vision of creating an impact by changing the way students learn,” founder Byju Raveendran said in a statement.
Byju’s had raised about $971 million before the latest round of funding according to data collated by industry tracker Tracxn.
The company — the only profitable consumer internet unicorn to have emerged from India — is likely to raise further funding of $1 billion through the course of this year and is in talks with multiple investors, including certain US-based endowment funds, the sources said. Startups deemed to be worth over $1 billion are commonly termed as unicorns.
Byju’s was valued at $5.5-$5.7 billion after its last funding round in July 2019 led by sovereign wealth fund Qatar Investment Authority and San Francisco-based Owl Ventures. The company also counts private equity major General Atlantic, Naspers, Verlinvest, Chan-Zuckerberg Initiative, Sequoia Capital, and Lightspeed Venture Partners as investors.
Times Internet, the digital arm of Bennett Coleman and Co, the publisher of The Economic Times, is also an investor in the company.
Founded by engineer and mathematics prodigy Byju Raveendran, the eponymous company is one of the rare Indian consumer internet companies where the founders, which also include Riju Raveendran and Divya Gokulnath, hold close to 35% stake. Mostly, founders of startup unicorns have had their stakes diluted to single- to mid-teen percentage points, after raising substantial rounds of capital, often at rich valuations.
Byju’s, which also provides test prep solutions for CAT, UPSC, JEE and banking exams, posted net income of Rs 20.16 crore for the financial year ended March 31, 2019.
The company managed to turn in a profit as the number of paid users — which currently stands at about 2.8 million — increased. Byju’s claims it has 40 million registered users on its platform.
Total expenses for fiscal year 2019, however, rose to Rs 1,321.65 crore from Rs 518.52 crore in the year-ago period, as employee benefit expenses, marketing, and promotional costs increased significantly.
Revenue in FY2019 jumped to Rs 1,341 crore, up from Rs 490 crore in the year-ago fiscal year. The company has forecast revenue of Rs 3,000 crore in the 2019-20 financial year.