Unacademy eyes to invest in K12 Techno Services
Unacademy is in talks to buy a significant stake in Sequoia Capital-backed K12 Techno Services, which operates the Orchids International school chain, according to two people familiar with the situation.
If the deal goes through, it will be the first time an edtech startup in India has placed a bet on a physical school chain.
K12 is also backed by Sofina, which makes the Belgian investment fund and Sequoia Capital shareholders in both companies.
According to the people cited earlier, Sequoia is likely to exit Orchid through this transaction.
“The talks are on for an investment of around $25-30 million by Unacademy... it may become a larger transaction. The discussions are currently in final stages...,” said one of the persons cited earlier.
Unacademy's decision to back a school chain is part of the company's plan to begin offering K-12 education on its platform. Byju's dominates this market.
SoftBank-backed Unacademy announced on Monday that it is acquiring Rheo TV, a live streaming platform for gamers, the latest in the edtech industry's mergers and acquisitions.
“Unacademy wants to tie up its physical presence and a lot of back-end operations with the acquisition of a chain of schools,” said a person with knowledge of the development. “Besides Orchids, it is also actively looking to acquire a chain in north and west of India.”
According to three people familiar with the developments, Sofina will invest alongside Unacademy in K12, and the current management will retain a minority stake and run the business. “A full sale cannot be ruled out if the offer is compelling,” the person added.
Sofina invested approximately Rs 200 crore in K12 a year ago.
K12 Techno Services, which was founded in 2010, is a school management company that provides academic support, services, and technology solutions to 37 schools in six cities across India. According to a Care Ratings press release from March 202, the promoters exited the company in 2016 and it was acquired by Sequoia Capital India, which now owns 64 percent of the company, while Navneet Learning LLP owns the remaining 36 percent.
According to the Care rating report, Orchid plans to open six new schools in FY22 and 12 in FY23. According to the release, the company's total operating income increased by 19 percent year on year to Rs 106.24 crore in FY20, up from Rs 89.15 crore in FY19.
Gaurav Munjal, Hemesh Singh, and Roman Saini founded Unacademy in 2015.
Unacademy Group is made up of Unacademy, PrepLadder, CodeChef, Graphy, and Relevel. Tiger Global, Dragoneer Investment Group, SoftBank VF2, Facebook, General Atlantic, and Sequoia India are among the investors in the company.
The edtech firm has bolstered its growth engine through inorganic means, acquiring companies in the last three years to expand both vertically and horizontally. Starting with the $10 million acquisition of Wifistudy in 2018, it went on to acquire Kreatryx, CodeChef, Prepladder, Mastree, Coursavy, Neostencil, and Tapchief, among others.
If the deal goes through, it will be the first time an edtech startup in India has placed a bet on a physical school chain.
K12 is also backed by Sofina, which makes the Belgian investment fund and Sequoia Capital shareholders in both companies.
According to the people cited earlier, Sequoia is likely to exit Orchid through this transaction.
“The talks are on for an investment of around $25-30 million by Unacademy... it may become a larger transaction. The discussions are currently in final stages...,” said one of the persons cited earlier.
Unacademy's decision to back a school chain is part of the company's plan to begin offering K-12 education on its platform. Byju's dominates this market.
SoftBank-backed Unacademy announced on Monday that it is acquiring Rheo TV, a live streaming platform for gamers, the latest in the edtech industry's mergers and acquisitions.
“Unacademy wants to tie up its physical presence and a lot of back-end operations with the acquisition of a chain of schools,” said a person with knowledge of the development. “Besides Orchids, it is also actively looking to acquire a chain in north and west of India.”
According to three people familiar with the developments, Sofina will invest alongside Unacademy in K12, and the current management will retain a minority stake and run the business. “A full sale cannot be ruled out if the offer is compelling,” the person added.
Sofina invested approximately Rs 200 crore in K12 a year ago.
K12 Techno Services, which was founded in 2010, is a school management company that provides academic support, services, and technology solutions to 37 schools in six cities across India. According to a Care Ratings press release from March 202, the promoters exited the company in 2016 and it was acquired by Sequoia Capital India, which now owns 64 percent of the company, while Navneet Learning LLP owns the remaining 36 percent.
According to the Care rating report, Orchid plans to open six new schools in FY22 and 12 in FY23. According to the release, the company's total operating income increased by 19 percent year on year to Rs 106.24 crore in FY20, up from Rs 89.15 crore in FY19.
Gaurav Munjal, Hemesh Singh, and Roman Saini founded Unacademy in 2015.
Unacademy Group is made up of Unacademy, PrepLadder, CodeChef, Graphy, and Relevel. Tiger Global, Dragoneer Investment Group, SoftBank VF2, Facebook, General Atlantic, and Sequoia India are among the investors in the company.
The edtech firm has bolstered its growth engine through inorganic means, acquiring companies in the last three years to expand both vertically and horizontally. Starting with the $10 million acquisition of Wifistudy in 2018, it went on to acquire Kreatryx, CodeChef, Prepladder, Mastree, Coursavy, Neostencil, and Tapchief, among others.
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