Post the latest funding, the Mumbai-based company is expected to be valued at $575-675 million, people familiar with the development revealed.
Screwvala has so far invested around $25 million of his own capital in upGrad since it was launched.
Besides Screwvala, upGrad’s founding team includes Mayank Kumar and Phalgun Kompalli.
The online education segment, both K-12 and higher education, has seen a huge charge of risk capital following the Covid-19 pandemic.
Screwvala, who is also the company’s executive chairman said, “The proceeds will be used for mergers and acquisitions to complement our ecosystem in higher education and working professional bases.”
Apart from acquisitions, the fresh infusion of capital will be used for growing upGrad’s presence in the US, UK, Middle East, and the Asia-Pacific. In the last six months, the edtech firm has set up a ground presence in the Asia-Pacific region.
upGrad operates in the post K-12 education space, providing online courses from universities across the globe.
“We think the post K-12 segment is going to be much larger than the K-12 segment in coming years,” Screwvala said. “Online degrees, especially undergraduate degrees, are a highly scalable opportunity.”
Investments will be made towards that segment as well.
There are various categories within post-K-12 — college and degrees, test preparation, and lifelong learning. “In lifelong learning, there are longer, deeper courses, shorter courses, and top-up courses. An M&A in those areas is what we’re looking at,” Screwvala said.
upGrad entered the test preparation market last year when it took over The Gate Academy, a chain of coaching institutes headquartered in Bengaluru, for an undisclosed amount. It also acquired hiring and staffing solutions firm Rekrut India around the same time.
Screwvala maintained that 85% of those who signed up for upGrad’s courses completed those. “Our completion record is better than that of many similar companies in the US,” he stated.
In April, it declared crossing Rs 100 crore in monthly revenue, thereby attaining an annual revenue run rate of Rs 1,200 crore. “We see ourselves growing at 100% a year for many years,” he said.
In 2020, the Indian edtech industry witnessed strong financial and strategic investor activity. The year was marked by the highest ever volume of consolidation and M&A activity. “Backed by strong funding, large incumbent platforms chose the M&A route to accelerate their growth and expand into ancillary offerings,” it stated.
The edtech segment is booming post the COVID pandemic. The latest funding will help upGrad be the leader in this segment.Shishir Gupta, Founder and CEO, StartupLanes
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