Byju's, the largest funded ed-tech startup in India has cracked a consumer which no other tech startup had been able to in the past few years – the Indian primary school student.
Riding on the image and genius of just one man – Byju Raveendran, and his famous methods of teaching calculus, geometry and algebra, the company has raised close to USD 244 million from investors such as Tencent, IFC, Sequoia, Chan Zuckerberg Initiative, and InnoVen Capital.
The last funding by Tencent in July, this year has valued the company at about USD 800 million.
The founder of the next anticipated big unicorn of India, however, likes to downplay his massive fundraising spree.
The Byju’s mobile app has had more than eight million downloads since its launch in 2015, with over 4,50,000 paid users.
Raveendran calls himself an “entrepreneur by chance.” But soon admits that behind his easygoing personality is a calculative mind.
“I think in terms of maths,” Raveendran says. “Every decision, for any choice, I depend on maths.” It’s a childhood habit, he says, judging the speed of the train, or calculating the height of a building, “That’s just the way I am.”
Quite naturally then, logic and reason are the two most important pillars of Raveendran’s success.
He agrees and says that has helped him quickly evaluate a failure and rollback, well before it becomes an operational expense.
“We had once tried to build a franchise model. We realised in the first few franchisees that this will not work,” he says, making his case for ‘logic and reason’.
Raveendran hails from a tiny village in Kerala, which he says, has worked to his advantage. Often an absentee in class, because of his commitment to five different sports, he learned through observation.
“I picked up English by listening to cricket commentary on radio. For maths I had no reference, so I started associating equations with everyday things,” he says.
With no boundaries of school syllabus, Raveendran explored much beyond. No doubt, students in Class XI in his neighbourhood turned to Raveendran for help when he was barely in Class VIII. But he insists: “it’s not a genius.”
“I have won many competitive exams, Olympiads, got 100 percentile in CAT, all because I have strong fundamentals in Maths. But our education system encourages rote learning,” he rues.
It is this emphasis on problem-solving than on encouraging children to be curious and ask questions, that this sprightly teacher-cum-entrepreneur is out to change.
On the ‘upcoming unicorn status’…
“We have no interest in creating a billion dollar company. We are more interested in doing what we are doing; everything else is a bonus,” Raveendran says.
The company’s latest monthly revenue is pegged at Rs 50 crore and will be profitable for FY18.
“I will not raise funds just to be a unicorn. Our aspiration instead is to create the largest education company in the world,” Raveendran says.
Byju’s is currently exploring overseas markets to launch their product. The company already has several users in Dubai, but Raveendran insists that “it is more or less India market for us because users are mostly Indian.”
In other markets, Byju’s will have to compete with global companies such as Coursera, Udacity, Udemy, HotChalk, and iTutorGroup among others.
iTutorGroup is a China-based ed-tech company with over USD 300 million of funding to date.
Byju’s secured over USD 140 million last year in one of the biggest funding rounds in ed-tech sector in India.
Scoring 100 percentile in CAT to teaching in auditoriums...
Byju’s as a brand boomed after it launched the mobile app in 2015.
But its journey started much before when Raveendran coached a few friends for CAT, while on a six-month break from work to India in 2003. His friends did well, and Raveendran too scored a 100 percentile.
On his next vacation in 2005, he took his first formal batch. He made a secret pact with himself to explore coaching as his full-time job for six months, and if it’s a failure, go back to the job or accept one of the offers from IIM!
It took him barely six weeks to make a decision. The batches that started with 35 students grew to 1,200. He had no choice, but to book an auditorium to accommodate the number of students.
“I started enjoying teaching. Response from students was overwhelming. At one point of time, I was taking classes in nine different cities in a matter of one week,” Raveendran says.
“It was mostly because of the content that I delivered. It was relatable and easy to understand. So word of mouth worked wonders for us. I booked an auditorium without thinking if it will fill up or not, but it did,” he adds.
Byju’s initial offerings were all centred on test-preparation, sans the visualisation that the brand is known for today.
In 2005, when Raveendran cracked CAT for the second time, he called upon some of his students to join him in expanding his teaching methods.
By 2009, the batch sizes were too big to be contained in a stadium or an auditorium, which forced Raveendran to innovate. So he turned to the online medium, started recording and beaming classes through V-SAT.
“The same format of teaching as with CAT students could not have worked for K-12. We needed to make it more interesting and easy to understand. It needs experience and entertainment. So we set up the content team, media team – to make content engaging; and a tech team to personalise the content.
For instance, if a student is weak on one fundamental theorem, the content will start from a level below to clear out the confusion. That analysis largely happens with automation. Some user cases we manually analyse which we then feed in. The app also tracks the complete learning cycle of the child. If a kid answers a question wrong, a remedial video is pushed. We can see the level of understanding we are achieving because it is backed by technology,” Raveendran says.
Today, the offline session barely accounts for 10% of the company’s business. This fiscal, the share is set to go down further to 5 percent.
Raveendran and his team are now focusing on entering new markets, and go deeper in India, into small towns. To that end, the company is building vernacular plug-ins for the product.
Although a tricky business to convince parents to entrust their child’s education on a product, than on a personalised attention of a teacher, Raveendran insists the market is worth tapping. According to him, there are over 20 million school children who opt for private coaching classes, translating it into an addressable market opportunity of about USD 2.5 billion.
“We still have a long way to go. We have barely scratching just 1 percent of the student population. When we reach 5-10 percent scale we will think we are doing something. I didn’t build this venture to sell. Our aim is to instil a learning culture in kids, where they learn willingly. If learning is not fun, it’s not right,” he summarises his journey.
email@example.com(Disclaimer: This story has been updated.)