Online education venture UpGrad is venturing into the higher education market with the acquisition of Acadview Software Pvt Ltd. We spoke to Mayank Kumar, Co-founder and MD, UpGrad and Himanshu Batra, Founder and CEO of Acadview to know more.
Online education startup UpGrad announced the acquisition of Acadview Software, and will now look to extend its core value proposition to college learners. So far, the company focusedon equipping professionals with employable skills.
UpGrad will now venture into the higher education market which has enrolments of over 35 million students across 50,000+ higher education institutes and 800+ universities.
How does this deal make sense for Upgrad and Acadview, and what will change post the acquisition? YourStory spoke to Mayank Kumar, Co-founder and MD, UpGrad and Himanshu Batra, Founder and CEO of Acadview to know more.
UpGrad was founded in early 2015 by Ronnie Screwvala, Mayank Kumar, Phalgun Kompalli and Ravijot Chugh. The company targets working professionals looking to get back to learning to progress in their careers without quitting their jobs. It offers working professionals and individuals university education online through structured and rigorous programmes and facilities.
Ronnie Screwvala invested Rs 100 crore in UpGrad and committed an additional Rs 200 crore. UpGrad’s only other acquisition before Acadview was in 2016, that of Pyoopil Education Technologies, a mobile-based SaaS (Software-as-a-service) product used by companies to deploy online training.
Founded in 2015 by ex-Googler Himanshu Batra, Acadview enables fresh graduates to find coveted jobs by upskilling them with in-demand technologies through online courses and industry projects. It also helps young IT professionals make extra income by teaching these courses and mentoring students.
Himanshu believes nothing great can be achieved without a good team. He says his co-founder Varun Jain played a pivotal role in the product and engineering side of business before he left for personal reasons. His other founder team member Jitesh Goel stepped up after Varun's exit and handled that side of the business.
The venture has got seasoned entrepreneurs and technology gurus like Gagan Saksena, Rohit Saboo and Barkha Gvalani (with years of experience at Google), Abhishek Prasad (from Amazon, Microsoft, and Groupon), and Shraddha Advani (from Yahoo) as mentors and technical advisors. Himanshu further believes that the role played by these advsiors and mentors was very critical in his journey.
The New Delhi-headquartered company has partnered with more than 80 private universities and colleges across five states in north India and claims to have onboarded more than 3,000 students in the last year alone. The company raised an undisclosed amount of funding from angel investors from India and Silicon Valley.
Talks between UpGrad and Acadview have been on for roughly six to seven months and Mayank says it was less about the deal, and more about ensuring the founders were comfortable working together. It’ll take around two months for complete integration of the product and team, he says.
“Acadview has a very strong presence among colleges, which is a much larger space with very different dynamics. So, now we have a strong product, understanding of customer ecosystem. That's the reason of coming together,” says Mayank.
At the macro level, UpGrad is looking to work on the quality of education in universities and colleges. Infosys and other IT giants recently said fresh graduates with niche coding skills start with higher annual compensations.
Ronnie Screwvala and Mayank Kumar in a joint statement, say, “College students in India are looking forward to picking up new age skills to make themselves more employable. UpGrad’s online learning solution and Acadview’s solid presence within the college space allow us to deploy learning solutions for college studentsat a massive scale.”
Acadview will continue to focus on the north India market, while UpGrad will expand its presence there. Acadview's model has been synchronous and offline and UpGrad will bring in the right online elements for scalability.
Mayank says, “In next 18 months. we expect college segment to contribute 15-20 percent of our total revenues. In case of working professionals, you have to build and create the market. In colleges, the market already exists and it's about who has a better product.”
He believes the quality of education in many institutes isn't up to the mark, and thus UpGrad wants to come up with an offering which is significantly better. It also plans to link the education to an output with the right kind of recruitment partners.
UpGrad is witnessing good growth in the working professional segment and Mayank believes that it'll continue to do well because of company’s understanding of that segment. In the college segment, there are three levels of change required from strategy, product and execution perspective:
"This way we put our skin in the game. Ultimately, I want to make money from their success. The money we take before their job roughly covers the cost of education with a minor loss."
UpGrad is also already talking of financing companies.
“Equipping students with engaging content, personalised coaching, hands-on experience with real world projects and guidance from subject matter experts in the industry can bring a step change in the quality of workforce available to employers.”
The year 2018 has been good for edtech startups so far. With almost 40 deals across the sector, more than $200 million has been invested this year. Platforms like Udacity, Coursera are direct competitors to UpGrad. Five-year-old bootstrapped Great Learning has a massive lead, though, and claims to have a turnover of Rs 100 crore.
The current gap in the quality of college education, and demand coupled with faster and cheaper data access paints a promising future for UpGrad and other online education platforms.