This Edtech Unicorn Chases Input Metric And Not Outcome
Eruditus recently turned a unicorn with a $650 million fundraise from Accel US and SoftBank Vision Fund II, which values the firm at $3.2 billion
Ashwin Damera, co-founder and CEO, Eruditus and Chaitanya Kalipatnapu, co-founder, Eruditus, were both beneficiaries of high-quality education that deeply impacted them both personally and professionally. However, they knew that for millions around the world, this was not the case. That question sparked the mission of Eruditus: to make education accessible and affordable to learners around the world.
“Once we identified the need, we went to work on how to deliver a model to make the most impact. We partner with the best universities globally and have created a personalized learning product that makes education affordable and accessible and delivers strong outcomes. When we started out we focused on launching a new business model, now we’re focusing on scaling this business across the globe,” Damera told Entrepreneur India.
Eruditus recently turned a unicorn with a $650 million fundraise from Accel US and SoftBank Vision Fund II, which values the firm at $3.2 billion. However, becoming a unicorn or valuations was never a goal for both Damera and Kalipatnapu. “It is always about what you are building. When we started in 2010, there were no unicorns in India. When in 2015 we tried to raise some money, around 20 funds rejected us. At that time, the only business milestone we had in mind was getting to $100 million in revenue. My fundamental belief is don’t chase the outcome, chase the input metric that is building a good product,” said Damera.
From Ideation To Unicorn
The founders’ decision to go online in 2015 was the pivotal decision that led to the startup’s success. By going online they could serve students in 80-plus countries, in five languages and 24*7. That dramatically improved its total addressable market.
“Growing up we didn’t have things like artificial intelligence and machine learning. Traditional business models used to work for generations before a new disruption came. But, in today’s fast-paced digital world, technological advancements have disrupted the ecosystem. Businesses re-shape in a matter of as short span as five years,” the co-founder added.
In India, 40 million people are enrolled in various courses in higher education (including undergraduate and postgraduate). This equates to a 27 per cent gross enrolment ratio (only 27 per cent enrolling in degree, of the total graduates). “Mathematically, around 20 million new seats need to be created to meet the demands. We realized that to bridge the gap, we need to have hybrid models of learning as the brick-and-mortar models cannot accommodate the ever-growing demands. With this goal, my co-founder and I met in 2010, rolled our sleeves up and one step at a time, our idea became a reality,” added Damera.
The startup pioneered Small Private Online Courses (SPOCs), creating industry-driven certification programs, professional certificates, and workforce leadership development initiatives in collaboration with its university partners around the world. The programs are defined by personal engagement between faculty and students, course customization, mentoring and coaching, and career counseling. From 4-5 partner universities in 2010, the company has today partnered with more than 54 universities.
Mumbai-based Eruditus added over 300 courses last year. In terms of revenue, it grew 2 times last year. In the last 12 months, the revenue was $175 million and the projection for the next 12 months is about $505 million. Additionally, it aims to have 75 university partners and 500-600 courses by next year. Last year, the startup also acquired iD Tech, a world leader in youth STEM education, based in California. Through the acquisition, it expanded into K-12.
“Even before the pandemic, the online education market had experienced explosive growth both at the K-12 and professional education levels. COVID-19 impacted our industry profoundly as the need for high quality, accessible and affordable online learning has never been greater. These changes have provided tailwinds for growth and now we are well-positioned to continue the momentum,” said Damera.
The startup claims that its competitive edge comes from the breadth of its global team and its partnerships with the best universities such as MIT, Harvard, Wharton, Cambridge, IIT-Bombay, IIT-Delhi, IIM-Calcutta, IIM-Kozhikode, XLRI, among others.
Its investor, Sumer Juneja, partner at SoftBank Investment Advisers agrees. “With the rapid rate of technological disruption, continuous upskilling is necessary in today’s job market. The company’s partnerships with elite universities, and use of technology and data to create and deliver high-quality courses positions Eruditus to lead in this space,” he said. The startup’s 35 per cent business comes from the US, 20 per cent from India, and the remainder from other markets.
Expansion And New Products
Further, the startup wants to look at ways wherein students can do one year of college from India and the remaining three from the US or do an entire degree course online. In terms of geographical expansion, it will continue to deepen its presence and investment in high-growth regions including Brazil, Australia, and the UK, and double down on new geographies.
“We are expanding across Europe, where the government provides a lot of benefits for skilling and so we have an edge across European countries. We currently offer courses in English, Spanish, Portuguese, Mandarin and Arabic and will continue to expand our language offerings. Just this past year our regional university partnerships expanded tremendously, particularly in LATAM and India, and also in China and Southeast Asia,” said Damera.
Additionally, the company is looking at bite-sized, micro-learning programs. It recently launched Emeritus Insights, an INR 7,000 subscription course, which was designed to create a five-minute daily learning experience. Users can learn from books and lectures from personalities such as Anand Mahindra, Ratan Tata and Narayana Murthy.
Overall, Eruditus aims to make high-quality education accessible and affordable. “We are inspired by the team that we work with, the partners we collaborate with, and the impact that we are making,” Damera said.
Shanthi specialises in writing sector-specific trends, interviews and startup profiles. She has worked as a feature writer for over a decade in several print and digital media companies. She is also a mom who looks forward to playing a game of cards with her tween daughter every evening after work.