upGrad, an online platform for higher education, announced on Monday that it had raised $210 million (roughly Rs 1,670 crore) in a round that also included ETS Global, Bodhi Tree, Kaizen Management Advisors, and others. This comes as India’s edtech companies are currently laying off employees due to the ongoing financing winter.
The business said that Founder Group contributed $12.5 million to the investment round to keep a majority stake in upGrad.
According to the edtech business, it is on target to make $400–500 million in gross revenues annually in FY23, with roughly 45% of those sales coming from its online courses and programs.
Over the next four to five decades, higher education technology will increase. According to co-founders Ronnie Screwvala and Mayank Kumar of upGrad, the firm has changed over the past 12 months to become the most integrated one in this field with job options for both students and working people.
Along with current investors Temasek, IFC, and IIFL, the fresh fundraising round also includes the Family Office of Bharti Airtel, Narotam Sekhsaria Family Office (Ambuja Cements and ACC), and Artisan Investments (Family Office of Lakshmi Mittal – ArcelorMittal).
The co-founders of upGrad stated, “We have always been incredibly capital efficient as we increased 100% year over year and want to retain that discipline.
How did Ronnie Screwvala start upGrad?
Ronnie Screwvala is the owner of upGrad, an online education platform that offers courses in digital marketing, data science, and technology.
Ronnie Screwvala started his career as a television producer. He then moved into film distribution and production. In 2006, he founded UTV Software Communications, a media, and entertainment company. He sold his stake in UTV in 2012 for $1.5 billion.
In 2015, Ronnie Screwvala founded upGrad. upGrad is an online higher education platform that offers courses in digital marketing, data science, and technology. The company was founded to provide affordable and accessible education to everyone.
upGrad has been growing rapidly since its inception. The company has over 1 million registered users and has raised $173 million in funding. In 2019, upGrad generated revenue of $94 million. Ronnie Screwvala is a successful entrepreneur who has built upGrad into a successful online higher education platform.
Ronnie Screwvala’s upGrad devoted $400 million to a reskilling initiative
Peer-to-peer learning, mentorship, and coaching—what Screwvala refers to as largely soft skills—will be provided through the job-linked learning program to make the workforce job-ready.
“I will remark that many managers and leaders today are not yet qualified for their positions. After only two years, they received a promotion, and now they must learn how to act like managers and leaders. Although it’s a contentious viewpoint, here is where the significance lies.
He told ET that upGrad would put a lot of emphasis on the new job-linked skilling program in addition to the higher education courses that the business now offers in association with colleges and institutions throughout the world.
Over the next three months, upGrad expects its staff size to increase from 4,800 to 7,600, comprising more than 5,000 contract coaches and mentors and roughly 170 full-time teachers.
The Plan behind “Reskilling investment”
The job-linked learning initiative, on which we want to double down and invest roughly Rs 400 crore, is the next big thing that we are focusing on in education, Screwvala told ET.
“We anticipate disruptions in learning over the next five years… As long as education is defined by calendar events — you go to school, graduate from college, and throw your hat in the air — that frame will remain frozen forever. The real world begins after that. This has been scheduled by your parents, social influences, and centuries of tradition. Those aren’t the disruptions I mean, but rather the disruptions that will occur after.
According to Screwvala, such disruption will be greatly aided by coaching and mentoring on a global scale. “In my opinion, peer-to-peer learning will be the major factor disrupting the next phase of general education. I believe that people will become less and less interested in degrees and more and more concerned with being prepared for employment, he said.
Internal accruals will be used to make the investments. UpGrad recently received $225 million at a $2 billion pre-money valuation.
He continued by saying that the nation must prepare its 100 million-strong populace for the employment market. “We need 100 million people to be job-ready, not 1 million or 2 million. While skilling is a hot topic, for the majority of people it is a lesser parameter. Being prepared for a job, however, is a quite different procedure.
How has upGrad been successful so far?
Ronnie Screwvala’s upGrad is an online higher education platform that has seen immense success since its inception in 2015. The company offers a range of courses, including digital marketing, and has a strong presence in India. upGrad has been able to generate a significant amount of revenue, with its course fees being very competitive. In addition, the company has been able to raise a significant amount of capital from investors.
Screwvala’s commitment through upGrad training
According to Screwvala, “You can complete our online program, which will last an average of six to nine months while working at your current position. Nobody likes to take time off to return to a classroom, so it’s not like you have to take time off. Online doesn’t necessarily mean a zoom call and live lectures like it did under COVID. In a digital environment, this peer-to-peer learning process is very dynamic and high-touch.
He used the IT business as an example, which took it upon itself to train its workforce and establish centres in Mysore and other locations, but he claimed that this was only true for one industry.
“It was because they realized people weren’t job-ready even in the year 2000. There are numerous large industries nowadays, including BFSI, supply chain logistics, food delivery, and transportation. People are not job-ready as the world is changing quickly, according to Screwvala.
The cost of the course, which upGrad will provide under its name, would range from Rs. 1-2 lakh and be spread out over 6 to 9 months. It will be an online course that you can do while working.
The business will make investments in content, education, mentorship, grading, and training. As the program expands, it will also want to mobilize the greatest trainer base.
To reinvest more in results and job placements, the corporation wants this segment to be profitable by the end of the first year. The edtech platform, which was introduced in 2015, has more than three million users in more than 100 countries, more than 300 university partners, and 1,000 business clients.
UpGrad purchased online education provider Harappa Education last month for Rs 300 crore (about $38 million). For more such updates read here.