Ronnie Screwvala-led edtech unicorn upGrad has initiated a merger of its entities, to create one main company in India, to drive its vision for an integrated strategy. Upon the consolidation of the subsidiaries, upGrad will become an integrated higher edtech global player, offering short-form courses, campus programmes and government test preparation courses.
“We’re here to build a long-lasting company and we want to be an integrated firm. Our main focus is to look at the knowledge workers around the world, which is about 1.3 billion. That’s our real market,” said Ronnie Screwvala, chairperson and co-founder, upGrad, in an interview. “When we started, we wanted to solidify our approach in India, which is about 250 million target group, and then look at the rest of Asia, emerging markets like Latin America, and Africa and then the US. Our positioning compared to anyone else in this sector is that we (want) to be an integrated lifelong learning company.”
To achieve this ambition, upGrad is merging its subsidiaries. upGrad Campus (originally Impartus) is expecting to be a Rs 100 crore revenue entity by March, 2022. The firm is aiming at doubling it in FY 23.
upGrad Jeet (originally Gate Academy) has launched a very different offering in the government test prep segment. Also, upGrad KnowledgeHut (originally KnowledgeHut) on short courses has been an instant hit, and will cross Rs 200 crore ARR (annual revenue run rate) in March, 2022 and then double a year later. Here 70 per cent of the revenue and learners are global.
As the global integrated higher edtech player, upGrad will offer courses for college learners such as undergraduate degrees and study abroad programmes. For working professionals, it would offer executive and masters programmes.
“When we say integrated, it means we want to be in the full value chain of the 18- 50 years (including) college learners and working professionals,” said Screwvala, who co-founded upGrad in 2015 along with Mayank Kumar and Phalgun Kompalli. “We can make them job-ready, (help them) complete their undergraduate degree or take them to the next level in terms of employment.”
upGrad offers over 100 courses in collaboration with top-notch global universities. These include Deakin Business School (Australia), Duke CE (US), Michigan State University (US), University of Arizona (US), Liverpool Business School (UK), IIT Madras and IIM Kozhikode. The firm has impacted over 2 million total registered learners in about 100 countries across the world.
upGrad competes with players such as Simplilearn, Udemy, Coursera, Edureka, Byju’s, Vedantu and Unacademy, which are also eyeing to tap different segments in the education sector. This is because the country’s $180-billion education sector has gone online to adapt to the new reality, leading to opportunities for edtech firms. India is positioned to become a $313 billion online education market soon, as the pandemic has precipitated an unprecedented jump in online education and job upskilling uptake in the country, according to the experts.
To tap such opportunities, upGrad’s M&A strategy is helping it in its vision of becoming an integrated edtech firm. In August this year, upGrad acquired edtech firm KnowledgeHut, which is aimed at equipping the global workforce with the skills of the future through outcome-based immersive learning. With this acquisition, upGrad has ventured into the short duration upskilling and reskilling segment which has a market potential of over $ 58 billion.
Early this year, the firm acquired Impartus (now upGrad Campus) – a leading video-enabled learning solutions provider. In its new avatar, upGrad Campus is targeting higher education institutions and college students, with its learning tools and content. The acquisition is also bolstering upGrad’s presence in the university education space. The aim is to help the youth of Bharat (rural India) learn the necessary skill set to become more employable.
Last year, upGrad acquired Rekrut India (now upGrad Rekrut) – a leading recruitment and staffing solutions company. This is enabling the firm to have complete involvement in the lifecycle of a learner – from education to employment.
Last year upGrad also acquired The Gate Academy or TGA (now upGrad Jeet) – one of India’s premier coaching institutes. The Gate Academy offers the GATE and other entrance tests for various public and government sector jobs. With the acquisition, upGrad made its entry into the test preparation market. This is aligned with the brand’s ambition of rural India penetration strategy in making Bharat employable.
Screwvala, pioneered cable television in India in the 1980s and then built a unicorn that was acquired by Walt Disney Co. His entertainment conglomerate UTV was acquired by Disney at an enterprise valuation of $1.4 billion in 2013.
In August this year, upGrad said it has raised a total of $185 million at a value of $1.2 billion, making it the member of the coveted unicorn club. The firm crossed $210 million annual revenue run rate (ARR) in September this year. It is on track to achieve a $500 million ARR in March 2022.
According to the World Economic Forum (WEF), by 2025, around 85 million people will lose their jobs. However, over the same period, 97 million new jobs will be created, these will require very different skills. Without the ability to reskill people quickly, and at scale, millions will potentially be displaced from work.
“Our job as an edtech company is to anticipate the careers of tomorrow, and then get people job ready,” said Screwvala.
upGrad said its programme completion rate stands over 80 per cent which otherwise is 3-6 per cent for other MOOCs (massive open online courses).
upGrad said it has four pillars of 360-degree learning which sets it apart from other players. In terms of content, there is an in-house original content and pedagogy for over 100 courses across data, tech, management and humanities. 70 per cent of the learning experience is designed and delivered through industry experts.
There is a deep personalisation element as well. upGrad’s team of counsellors’ handhold (virtually) each learner for the entire duration of course thus smooth on-boarding, mentorship and continuous motivation. Rich interactivity with faculty, coaches and peers takes away the loneliness of online. The students are provided with personalised job recommendations based on experience, aptitude and personal ambition.
Students get full flexibility to study at a time of their choosing. This includes a blend of live class experience and recorded lectures. There is also community learning, where a specific community is created with a blank discussion forum for each cohort to encourage learners to ask questions, post more queries, and not hesitate.
Regarding the career outcome, upGrad said 79 per cent students attained meaningful career benefits, out of all who were looking for professional growth, job transitions, promotion, or other career outcomes last year (Learner Study 2020). During the pandemic year of 2020, over 450 companies including ZS Associates, Paytm, Gartner, Flipkart, Accenture and E&Y, have hired over 1200 learners from upGrad talent pool.