Online executive education firm Eruditus said on May 20 that it has acquired Silicon Valley based iD Tech for $200 million cash, the largest acquisition by an Indian edtech startup outside of Byju’s dealmaking spree.
iD Tech was founded in 2000 by Pete Ingram-Cauchi and provides short term courses in coding, game development, robotics and design for kids from ages 13-19. It started originally as an offline summer camp, but the company pivoted to an online model and now sees demand year round as more students learn from home during the Covid-19 pandemic. The deal marks Eruditus’ entry into a younger market- K12, while most of its current courses are geared towards experienced professionals or at least graduates.
“This is a very commoditized market, where product differentiation is lacking in many cases. The product is what made iD Tech special for us,” Ashwin Damera, co-founder and CEO of Eruditus told Moneycontrol.
The deal will help iD Tech expand beyond the US, which accounts for 90% of its revenue so far. iD Tech expects to have a revenue of about $45 million as of October 2021- when its fiscal year ends, said a person familiar with the matter. As the US opens up after the pandemic, offline revenue is expected to bounce back too, and the company expects a revenue of $100-120 million by end 2022.
Eruditus’ core business involves tie-ups with foreign universities such Columbia University, Massachusetts Institute of Technology and Harvard Business School for short and long term courses. The deal will also help iD Tech expand its offerings to some of these universities, and these colleges in turn can get access to quality talent at an early age.
“We can help expand iD Tech to India, China, Latin America- places where we have a footprint and can leverage our brand. A brand lends credibility,” Damera said.
“Universities want to leverage the high school market globally. While they have done this mainly in liberal arts so far, we want to add more skills of the future, which relates to science and technology,” he added
The current virtual camp has one-to-one classes, small groups and large groups collaborating on a single project.
Eruditus was last valued at $800 million when it raised $113 million from Prosus Ventures (Naspers), the Chan Zuckerberg Initiative and Sequoia, among others. Cash for the deal will partly be paid in the next week or so and partly over the next 6-12 months.
Eruditus had $185 million revenue in FY21, which it expects to more than double in the next year.
“More and more kids are experiencing STEM (Science Technology Engineering Math) touchpoints in their daily lives, whether it’s coding in their favorite video games or 3D printing mask extenders. The pandemic accelerated interest in STEM fields, and we have been ecstatic to see more interested learners exploring and mastering this space. Both iD Tech and Eruditus share the belief that such offerings will only continue to grow in interest, and we are confident that we can open access for people everywhere to our courses and instructor,” said iD CEO Ingram-Cauchi.
Smriti Chaudhary contributed to the story.