Unacademy doubles down on profitability
Edtech unicorn Unacademy is slashing “unnecessary expenses” to focus on turning profitable as soon as possible, especially as it plans to float an initial public offering (IPO) in the next two years, says Founder Gaurav Munjal.
The latest buzzword of the Indian startup ecosystem isn’t the latest technology or the most disruptive business model. It is “profitability”.
In the last couple of years, various stakeholders of the ecosystem have been discussing how more startups need to focus on spending less cash, get out of the “growth at all costs” mentality, and focus more on building sustainable businesses and a path to profitability.
The recent downturn in the economy has not only resulted in lower valuations for startups in India and abroad but also put the spotlight sharply on the need for profitability.
One of the sectors facing the biggest reality checks is edtech. It seems like the pandemic-led frenzy has died down—there’s no endless flow of funding anymore, startups in the sector are closing shop or laying off, and many are scrambling to take a bite of the offline education business.
In an email to employees, Unacademy—one of the largest players in the edtech market—said it is slashing “unnecessary expenses”, embracing “frugality as a core value” and focusing on turning “profitable asap”. This is the second time Founder Gaurav Munjal has written to his team, saying the company must change its ways.
Winter is coming and startups are clearly starting to feel the chill.
Edtech unicorn is slashing “unnecessary expenses” to focus on turning profitable as soon as possible, especially as it plans to float an initial public offering (IPO) in the next two years, says Founder Gaurav Munjal.
In an email to employees, he emphasised that although the Bengaluru-based startup has over Rs 2,800 crore in the bank, it is not efficient at all, and getting rid of unnecessary expenses is imperative for it to hit profitability.
Here’s what’s happening:
- Unacademy said meals and snacks will not be complimentary anymore across its offices.
- All its employees, including CXOs, founders, and educators, will not travel business class on the company dime and management and founders will take a salary cut.
- The edtech unicorn will also shut those businesses that have failed to find product-market fit, like the Global Test Prep vertical.
"We are well capitalised, but we still want our businesses to be profitable. And it will take Unacademy Group to a different league," the email, seen by YourStory, read.
After spending close to a decade studying and working in Europe, Prasanta Sarkar and Rochan Sinha returned to India to find the cities they’d grown up in dirtier, polluted, and more prone to sudden heavy flash rains than ever before.
The duo worked to develop new battery and electrolyser technology for companies—something cheap and readily available. However, they realised they were on to something big only after they produced the electrolyser for a much cheaper price than what was available in the market.
They decided to deploy it in the production of green hydrogen and set up in October 2021.
- Newtrace sells its proprietary, patent-pending electrolysers to companies looking to set up their own green hydrogen production plants.
- Its electrolysers are priced at $1,000 per kilowatt, the deployment of which can immediately result in a nearly 5X reduction in capital and operating expenditure for companies.
- Newtrace’s target markets are India, Europe, and the US, "especially the unsexy and polluting industries such as refineries, ammonia and methanol manufacturing" industries.
Kajal Malik, Vidyarthi Badireddy, and Utsav Bhattacharjee were running Gurugram-based campus placement startupwhen they realised the aspirations of young graduates from Tier II and III colleges were not met adequately by the limited employment opportunities.
This translated into an opportunity to present alternate and additional earning opportunities for ambitious, underemployed youth across India. The trio launched PickMyWork in 2019, which operates a network of gig workers to help digital companies distribute and sell their products at a very low customer acquisition cost (CAC).
What it does:
- uses technology to source, train, and manage agents, after which it presents tasks from internet companies as gig earning opportunities to underemployed youth.
- The startup promises 3X earnings per hour of effort as compared to other delivery gigs.
- Its clients include Meesho, Freecharge, IndusInd Bank, Jar, Fi Money, Amazon Pay, and Lendbox.