Byju's Enters the Prestigious Unicorn Club: From a Passionate Idea to a $1 Billion Business
The edtech startup Byju's is now a part of India's prestigious Unicorn club with $1 billion in estimated worth. The start-up had earlier raised funding from Verlinvest, a large Belgian family-owned, consumer-focused, diversification investment holding company and had also secured $50 million in a round co-led by Mark Zuckerberg's and Priscilla Chan's investment arm - The Chan Zuckerberg Initiative (CZI) -and Sequoia Capital, along with the other bunch of investors such as Sofina, Lightspeed Ventures, and Times Internet Ltd.
Unlike most entrepreneurs, who get the funding and then start their enterprise, Byju Raveendran started with what he loved the most, which is teaching, and then went on to create one of the most renowned name in the edtech space today. His love for teaching has today helped him garner 3.5 million students on his company's learning app, which was launched last year.
Byju started off taking coaching classes for candidates appearing for competitive examinations like GRE, CAT and others. Soon his classrooms got converted to auditoriums and then stadiums and then eventually ended up being conducted in different cities. "It's difficult to answer as to why I started this business, it started as a hobby and passion and due to its impact it became a business," Byju said.
Start Loving What You Learn
The company claims to have taken a fundamental approach to learning, especially for the new products that were launched in 2011. "The focus is also given on learning on your own by asking questions than just depending on spoonfeeding," he said.
Byju feels there are two types of learning that happens – one is because of fear of exams and the other is learning because you love to learn.
"In the second approach where once you started loving what you learn, the results will automatically come. Rather than training students to solve questions, it's very important to train them to find problems, bringing back the child like curiosity in them." Byju however, added that exams were a crucial part of assessment in the system to determine their eligibility in colleges and universities. He said that learning should be in form that exams are taken care of.
"We Never Went Looking for Investments"
The education-technology startup has scooped funding from noted firms like Sequoia Capital, Belgium-based Sofina Capital, T.V. Mohandas Pai and Dr. Ranjan Pai of Aarin Capital. In Byju's case, most part of the initial business was generated with the money generated from the initial leg of the business.
"Since we reached a "good" stage before investors came in, it was never really a challenge to raise investor money. Series A and Series B came in due to inbound interest from investors. The company never went looking for funds, there was no seed investment" he said. According to Byju when you get your business right and there is strong revenue, business plan and strong engagement from students and high percentage of retention are important parameters for investors to comprehend that there is a fundamentally strong business plan.
Have a Dynamic Business Plan
Stressing on the need of a strong idea and team in the initial stages, Byju also believes it's important to execute things at a faster pace. "Planning dynamic business plan in the beginning, will help you to avoid making big mistakes. It's important to be flexible to changes quickly midway through your plan rather than having a fixed long-term plan. It's best to try out multiple things and be sure about the core idea that you had started with," he said.
This article first appeared in the Indian edition of Entrepreneur magazine (June 2016 Issue).