Notes from Kota | Teachers have last laugh, get fat hikes as poaching intensifies at India’s coaching capital

Aakash Gandhi (name changed), a physics teacher, decided to switch to Unacademy from his previous job as a Physics faculty at Bansal Classes in 2020, when the government announced a nationwide lockdown to curb the spread of the contagious COVID-19.

“The online and digital facilities weren’t very great here (at Bansal Classes), or at any other existing classes. Most of us used to have lectures over Zoom. I thought it would be better to join a class that has actually done well in this space and the best bet for me was Unacademy,” Gandhi said.

“Unacademy also offered me a hefty hike on my existing salary, and they had robust online infrastructure. But a few months down the line, I started missing the feel of physical tuitions. We are teachers at heart, and we love to interact with students physically. So, I decided to join a traditional class as soon as the situation normalised,” Gandhi added.

Gandhi said he was even willing to work at a lower package at some of Kota’s traditional renowned coaching classes.

“I knew the package that Unacademy had offered could not be matched by any classes here. But I was fine with it. I just wanted to be back on the ground,” said Gandhi.

But to Gandhi’s surprise, he got an offer from Allen Career Institute, one of Kota’s biggest offline coaching centres, in December last year, which was a 35 percent hike on his existing package of Rs 1.3 crore.

“I was shocked, to be honest. I knew students would return to Kota after the pandemic, but I wasn’t expecting this,” said Gandhi.

“These classes saw more students coming in. So, they were expanding and offering huge packages to educators. Student influx was so high that these new companies have also come in, and that has made the competition for educators more intense,” Gandhi added.

Mega bucks

Gandhi is not alone. The salaries of teachers in Kota have gone up by about 40 percent on an average across subjects since classes have reopened in the town after two years of lockdown, according to multiple educators and class-owners Moneycontrol spoke with.

The influx of students is also stronger than expected in Kota this year. The total number of IIT aspirants in 2021 had more than doubled to as many as 22 lakh candidates. This year the number is expected to top 22 lakh candidates. However, only 16,000 seats are available across India’s 23 IITs, making competition for every seat intense. And since Kota churns out a large number of successful IIT aspirants every year, demand for the town’s classes and teachers has jumped post the pandemic.

The rise in demand for Kota’s ecosystem has even lured well-funded new-age online edtech companies like Unacademy and PhysicsWallah to foray into the town and open offline tuition centres. This has further intensified the competition for star teachers.

“What Unacademy has done is it has promoted educators more than anything and has done it extensively,” said Mohit Bhargava, head of physics department at Unacademy, who recently moved to the SoftBank-backed edtech company from Allen.

“Other classes also used to do it, but Unacademy has done it more and the student demand we are seeing here is majorly because of that. All the buzz over our salaries is because of that essentially,” Bhargava added.

Millionaire educators

Bhargava was one among the 40 educators Unacademy had poached from Allen a couple of months back. According to sources aware of the matter, Unacademy offered 30-40 percent hike on an average to all the 40 educators it poached from Allen in June.

Some were even offered 100 percent hike. To be sure, this hike was on a high base. Sources said that the educators were earning around Rs 1.15 to Rs 1.2 crore on average. To put the number in perspective, an average professor at an IIT earns about Rs 20 lakhs a year, which is about a fifth of what Kota’s educators earn.

“Most of the professors at IITs are researchers. Their main aim is to do research and they are passionate about teaching. So, you will see them earning much lesser. If they opt for a corporate job, they will be earning millions, but they choose not to as they wish to invest in research. You cannot do that (research) as a teacher at these institutes,” said an assistant professor at IIT Bombay, requesting anonymity.

Moneycontrol had reported earlier this month on how Unacademy had spent as much as Rs 100 crore on hiring 30 educators in Kota.

“Unacademy has also kept most of these employees on contractual basis. If you are at Allen, you are an employee of Allen, but at Unacademy, you’re not an employee of Unacademy. You’re just a contractual teacher,” said a person closely associated with the top management of Allen.

“This made their (educators’) packages even more attractive as they save a lot on taxes. Considering that these educators earn in crores, they are technically eligible for high taxes, but because they are not permanent employees, they save taxes, get some money as allowances also. This has forced companies like Allen to increase their packages throughout,” the person added.

Questions sent to Unacademy and Allen on Wednesday evening remained unanswered. The copy will be updated with the companies' responses, if any.

Living it big

The steep hike is however, unlikely to reflect on their lifestyle, observers say.

“If you live in a city like Kota, your expenses are not much, and these educators have always been getting huge sums,” said the person.

“So, with the salaries going up now, I don’t think their lifestyle will change as such, it has always been luxurious. They might buy a bigger car, but that’s it. I think their other investments might go up. Ask any educator here, he will know how the (stock) market performed today. They believe a lot in traditional investing, like in shares and real estate, and many have quite a few investments. Crypto and all is yet to come here,” the person added.

According to another person in the know, most of these millionaire educators have independent bungalows in the town. Some also stay in large houses in gated communities in Kota.

Most of Kota’s educators are themselves IIT alumni and are qualified subject experts, said a person closely tracking the space.

“The so-called IIT-culture is imbibed in all the students here (Kota). That is mainly because most of the teachers are themselves former IITians and they know what that side looks like,” the person said.

“Even if they aren’t from IITs, they have spent enough time with people from IITs, and so they teach you the right way, and so you see such high demand for all these teachers,” the person added.

A war of sorts

The aggressive poaching by new-age edtech companies had resulted in a full-blown war between these companies and incumbents like Allen Career Institute.

“There is competition here for teachers and it is unprecedented,” said Nitin Vijay, Founder and Chief Executive Officer of Motion Classes, one of Kota’s most famous coaching institutes.

“In my opinion, this competition is healthy. You need to have such competition for the ecosystem to grow as a whole, and I think it (the rising competition for educators) sits well with this concept,” Vijay added.

Earlier this month, Allen sued 20 of its former educators, who had moved on from the company, over an alleged breach of contract. The case is listed in the Jaipur Commercial Court and the next hearing is scheduled on August 8, according to sources.

“Something like this (aggressive poaching) has always been happening in Kota. The only difference is Allen is at the receiving end of it this time. Otherwise, they are infamous for doing it for ages. Plenty of classes have shut shop because of their aggressive poaching,” said one of Kota’s famous educators.

“Now since they are at the receiving end of it for the first time, they are frightened and that’s why you saw that video addressed to educators. They know these companies are better employers in general and so they are fearing the competition,” the educator added.