Peak XV may halve its stake in K12 Techno ahead of new fund: Sources

Leading venture capital firm Peak XV Partners (formerly Sequoia Capital India & SEA) may reduce its stake in K12 Techno, which runs Orchids International School, by 50% ahead of the launch of its new fund, reportedly worth over a billion dollars, people familiar with the matter told YourStory.

The VC firm currently owns approximately 22% of K12 Techno, split nearly equally between two funds—Peak XV Partners Investments V and Peak XV Partners Growth Investments IV. It may sell the entire stake held by the former, through which it invested in the company in 2018, sources said, requesting anonymity. Although Peak XV hasn't actively sought buyers, the firm is receiving inbound interest as private equity firms explore opportunities in the traditional schools sector, they added.

“Globally, PE firms have been increasingly looking at the education sector, especially schools. So, many PE firms are even looking at opportunities in India. There’s also a deal in making in the schools space, and this has triggered interest in the sector, and now PEs are exploring other good assets,” said one of the people quoted above.

The person was referring to Jaipur-based Jayshree Periwal International School, which has appointed bankers and is looking for a PE investment. VCCircle had reported the development in April.

“K12 (Techno Services) turned EBITDA positive last year (FY24) and has scaled well. If a reasonable valuation is offered, Peak might go for the deal, especially as it eyes a new fund. It will further bolster its liquidity, which is expected to be garnered from its upcoming IPOs—Pine Labs, Groww, and Meesho,” the person added.

Peak XV and K12 Techno declined to comment.

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According to a valuation report filed with the Ministry of Corporate Affairs in March this year, K12 Techno Services had an equity value of Rs 4,714 crore and was expecting a turnover of Rs 500 crore for the current financial year (FY26) with a net profit of almost Rs 72 crore.

Since 2023, Peak XV has been actively offloading shares in K12 Techno, initially to Kedaara Capital and later to Kenro Capital. In December 2024, Peak XV sold part of its stake to Kenro Capital at a reported valuation of Rs 5,000 crore.

K12 Techno is the latest startup where Peak XV has offloaded shares through secondary sales. Over the past 18 months, the firm fully exited HealthKart, the health supplements maker, and hyperlocal logistics unicorn Porter, while also reducing its stakes in listed companies like Freshworks and Blackbuck. In May, it also completed its exit from Indigo Paints.

Additionally, Peak XV will be the largest seller in the IPOs of Pine Labs and Wakefit, and it may pare its stakes in Groww and Meesho, potentially reaping further windfall gains, YourStory had reported earlier.

This push for liquidity aligns with Peak XV’s aim to demonstrate strong returns to its Limited Partners (LPs) as the firm navigates a challenging 24 months since splitting from Sequoia Capital in June 2023.

Several of Peak XV’s portfolio companies, including major players in India’s startup ecosystem, have faced operational and legal challenges. The firm also experienced key leadership departures, including Shailesh Lakhani and Abheek Anand, which compounded its struggles.

Peak XV is now preparing to launch a new fund, worth $1.2-1.4 billion, according to an ET report. With the new fund—the first since its separation from Sequoia—on the anvil, these gains from secondary sales and IPOs will provide crucial financial stability for the firm.