The

Future Of
India’s $2 Bn
Edtech
Opportunity
Report 2020
Table Of
Contents

Scope Of The Report 01

Executive Summary 02
Introduction To The Report 04
India’s Education Landscape 05
Edtech Startup Landscape In India 11
Investment Trends In Edtech 21-34
Indian Edtech Startup Funding Trends
Investor Activity In Edtech Domain
Case Study: Edtech Startups’ Quest For
Nabbing Majority Market Share
List Of Active Edtech Investors In India 34
Skilling & Re-Skilling 36-49
India & Skill Deficit In Industrial Revolution 4.0
Understanding Skill Gap: India Vs The World
What Is Driving Edtech In India 50-58
Market Factors Behind Edtech Growth In India
Edtech And The Indian Consumer: What Really Drives
The Decision To Buy
Financial Performance Of Top Indian Edtech 59
Startups
Why Edtech Adoption Is Still A Distant Dream 66
Future Trends & Technologies 69
Methodology 72
Glossary 73
Bibliography 74
 Scope
Of The
Report
This report is based on the assessment of India’s online education
market and aims to analyse the impact of education technology or
‘edtech’ on the country’s education landscape as a whole. It seeks to
provide an in-depth view of the very factors which contribute to the
adoption of online education platforms in the country. It focuses on
the challenges faced by such platforms in driving users and creating
awareness, and is aimed at delivering an overview of the sub-sectors
within edtech, besides the adoption of new-age technologies and their
defining trends.

The report — The Future Of India’s $2 Bn Edtech Opportunity Report

2020 also underlines the issues pertaining to skilling and reskilling,
which has become a pain point in many industries at a time when India
is riding on the edge of Industrial Revolution 4.0. The report spans the
areas where edtech startups are making skilling and reskilling possible
efficiently and effectively. Besides, it discusses at length the factors
responsible for the popularity of test preparation and online certification
startups among Indian investors.

From a consumer’s perspective, a market analysis complemented with

behaviour mapping of edtech consumers in India in both the B2B and
B2C segments is included.

To provide a holistic view of the sector and the performance of

startups operating within it, the report offers a juxtaposition of the
funding, M&As and business operations of edtech startups in India. A
comparative analysis of business metrics containing annual run rates,
expenditure splits and revenue/loss trends included in the report offer a
broader view of the money flows.

Overall, this report presents a market study of the Indian online

education sector from its evolution to future prospects as a business
opportunity for new as well as existing entrepreneurs. India in both the
B2B and B2C segment is also included.
© Inc42 Media | not for distribution

1
 Executive
Summary

4,450+
Edtech startups have
$120 Mn+
GMV of edtech startups in the
launched in India FY’2018

1,150+ 20%
Edtech startups have shut Share of funded edtech startups with female
shop founders

194+
Edtech startups have
Bengaluru
Recorded the highest number of edtech deals
© Inc42 Media | not for distribution

raised funds whereas Delhi NCR had the highest number of

funded startups

2
 48%
Surge in GMV of edtech
Most active VC firm in startups from 2017 to 2018
edtech

Buying
Impulsive
behaviour

2016
evident
among
edtech
consumers Had maximum funding deals
in edtech space

47%
CAGR of capital inflow into
6.3%
Growth in Indian
edtech startups in 2015-2019 consumers’
expenditure on
education from FY12
to FY17

56%
Median revenue
78%
Edtech funding skewed
growth of edtech towards test preparation
© Inc42 Media | not for distribution

startups from FY’17 to

FY’18

3
Introduction
India is all set to be a part of Industrial Revolution 4.0. With more than 39,000 active
tech startups embracing technologies such as blockchain, artificial intelligence,
machine learning and data analytics, the startup ecosystem in India is enabling a
revolution in all major industries including education.

India has come a long way from being the land of gurukuls with an emphasis on
traditional elements of teaching covering religious studies as well as Indian
mathematics and Indian logic. The Gen C today talks about smartphones,
gamification, live classes, online tests and school enterprise resource planning
(ERP) systems as an integral part of the contemporary education system.

Education technology startups play a key role here. Challenging the traditional
education ecosystem, online education has now grown deep into the community of
young students and parents. Access to cheap data packages has made platforms
such as YouTube and Tata Sky a popular medium to access education from a
consumer’s perspective. The rise in adoption of digital channels and cashless
payments has led to significant growth in the sector.

Although startups have over time been able to deliver the right content to the right
audience and clock aggressive topline growth, they still have a long way to go to gain
both acceptance and prominence. According to DataLabs by Inc42, 186 unique
edtech startups have raised $1.73 Bn funding since 2014. The success of startups
such as BYJU’s, Vedantu and Toppr offers a mere glimpse of the potential in the
sector.

From $247 Mn in 2017, the opportunity in India’s online education market is

estimated to soar to $1.96 Bn in 2021. Key driving factors include deeper penetration
of the internet and smartphones, rising disposable incomes and the ever-growing
demand for reskilling.

With education being the primary expense of Indian households, the education
sector in the country has tremendous potential for the emergence of more unicorns
like BYJU’s.
© Inc42 Media | not for distribution

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 India’s
Education
Landscape
Key numbers to consider

1.5 Mn 8.5 Mn
Teachers
Schools with

335 Mn
enrolled students

903
Universities

39,050
Colleges

Top 50
Districts have about

10,011 32.6%
© Inc42 Media | not for distribution

of total colleges in India

Standalone Institutions

*As of 2017-2018

5
500 General
Total enrolment in higher
education has been
estimated to be
126 Technical
36.6 Mn
70 Agriculture & Allied
with

19.2 Mn
58 Medical boys and

22 Law
17.4 Mn
girls

13 Sanskrit

10 Large

English-
Language Universities

Speaking
population allows easy
delivery of educational
Girls constitute products

47.6%
of the total enrolment

India was ranked

As per 28
out of
2011 88
census, India has an
countries in English
overall literacy rate of
Proficiency Index

72.99% 2018
© Inc42 Media | not for distribution

*As of 2017-2018

6
 Edtech In India Today
Startups
According to DataLabs by Inc42 estimates, there are a total 4,450 edtech startups operating in India currently. Between
January 2014 and September 2019, around 1,150 edtech startups have shut operations. Key edtech players holding
a majority market share in India’s education system include BYJU’s, Unacademy, Vedantu, Coursera, Toppr and Flintobox.

Barter.li Bibox MIPS

Matrubharti RapL

Schoolguru
Toppr Exam18
Notesgen
Eruditus NACTUS Smartivity
Collegedunia
Impartus
Stoodnt
LabInApp Edgefx
Simplilearn Zeroinfy
Learntron PlayAblo
Unacademy Oliveboard
Embibe iNurture
Exam18 Nayi Disha
Fundamentor
Oheyo
eShiksa Quizizz
Coursera Genext
BYJU’S Students
Byndr
Magic Crate

LearnOn

Experifun Civilsdaily
GAMOOZ
Avanti
Foradian
Matrubharti
Vedantu Vedantu

Edurev
Cuemath
Sudiksha Report Bee
Meritnation
Testbook HashLearn
Prozo
makkajai
Plancess Kidovators
KleverKid

Disprz
Cuemath
Coding Labs EduKart Verzeo
© Inc42 Media | not for distribution

Eckovation
Insofe

*only funded startups included, some of the startups have shut down or acquired or merged

12
List Of
Active Edtech
Investors In
India
This list is based on edtech funding activity
between 2014 and September 2019 publically
available startup funding data

Investors Deal Participation Notable Startups

11 Unacademy, MadRat Games

10 BYJU’s, Eruditus

9 Vedantu, Whitehat Jr

7 Quizizz, Unacademy

6 Toppr, Unacademy

6 EduPristine, Vedantu

5 Toppr, Simplilearn

4 Online tayari. Springboard

4 Thinkerbell Labs, University Living

© Inc42 Media | not for distribution

India
Educational
4 ChipperSage, Oliveboard
Investment
Fund

34
About DataLabs
by INC42
The research wing of Inc42 Media, DataLabs specialises in producing comprehensive
data-driven and insightful reports about the ballooning Indian startup economy.

30,000+ 2.6K+ 35+

Actively Tracked Reports Sold Reports Published
Startups

15+ 12+ 54%

Startup Sectors New Reports Of our audience are at
Covered Published Every Year senior/decision making
positions

Quoted & Trusted By The Media Worldover

Contact Us
[email protected]
What Is Driving
Edtech In India

Market Related Factors

Higher internet penetration
Higher penetration of smart devices
Increasing online content consumption
Young employable population
Increased demand for skilled professionals
Aligned government initiatives

Edtech And The Indian

Consumer: What Really Drives
The Decision To Buy
Cost advantage over physical coaching
Success factor marketing
Ease in content consumption
Employability quotient
© Inc42 Media | not for distribution

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 Future Trends
& Technologies
According to an analysis incorporated in the Economic Survey 2017-18, which studies the behaviour of Indian
consumers in relation to select commodities across varied income levels, the income elasticity on education is
estimated at 0.93 compared to 1.95 in healthcare. This indicates that be it any income level, the Indian consumer
will prefer investing more on education than healthcare. The analysis uses Engel’s law of income elasticity to arrive
at the quantity demanded of a particular good at a specific income level of the buyer while assuming that all other
demand determinants remain unchanged.

Commodities Elasticity In Response To PFCE

Food And Beverages 0.61

Housing.electricity, Gas, Etc. 0.78

Education 0.93

Transport 0.98

Communication 1.09

Household And Furnishing 1.39

Clothing And Footwear 1.44

Health 1.95

*PFCE is Private Final Consumption Expenditure in the

domestic market
© Inc42 Media | not for distribution

69
Methodology
This report presents the study of datasets related to edtech (which means

the application of technology in educational products and services both on

B2B and B2C fronts), the datasets are collected from both primary and

secondary sources. The investment activity recorded in the report for the

year 2019 is dated from 1st January to 26th December. The default base year

for calculating growth rate (CAGR%) is 2015, unless mentioned otherwise.

The segregation of funding stages in this report is done on the following

basis— seed stage (before Pre Series A), bridge (transition funding rounds

like Pre series A,B C), Growth Stage (Series A and B) and Late Stage

(Series C and beyond).

The median is calculated using quartile two of the data set. Forecasting of

funding amount and deal count is done using exponential smoothing on

annual trend of capital and deal inflow. The top 5 technologies to look out for

in 2019 are based on the problems these technologies are capable of solving

in context of the Indian economy. We arrived at this list by considering the

social and economic problems these technologies will be able to solve better

than their contemporaries. The top sectors and startup hubs are based on

the number of deal counts poured in the respective sector/hub between

2014 to 2019.

The roadblocks section has been formulated by analysing the impact of

these policy changes on the investment activity post and pre implementation.

Our definition of tier I cities include—Delhi NCR, Bengaluru, Mumbai,

Chennai, Hyderabad, Pune, Kolkata and Ahmedabad. Whereas the “top

three startup hubs” in the report is referred to Bengaluru, Delhi NCR and

Mumbai, derived from their dominance in overall startup investment activity

since 2014.
© Inc42 Media | not for distribution

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 Glossary
Edtech Startups An organisation or firm which PFCE Private Final Consumption
facilitates technology enabled Expenditure
products and services in the
education sector Seed Stage Upto seed funding round

Test Preparation An edtech startup which has

product/service focusing on Bridge Stage Any transitional funding rounds
preparing aspirants for an exam

Skill Development An edtech startup whose primary Growth Stage Series A and B funding rounds
goal is development of
professional/personal skills
Late Stage Series C and beyond funding
Online Certification An edtech startup whose core rounds
focus is on providing online
certification courses to aspirants VC Venture Capital

Enterprise Solutions A startup providing enterprise

level solution to enhance YoY Year-on-Year
academic operations in
educational institutions
TAM Total Addressable Market
STEAM An edtech startup providing
physical kits for development of
skills in science, technology, $XXK XX Thousand USD
engineering, arts and
mathematics domain
$XX Mn XX Million USD
Online discovery An edtech startup providing an
online portal to discover academic
products and services $XX Bn XX Billion USD
© Inc42 Media | not for distribution

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© Inc42 Media | not for distribution

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 The data provided in this report has been obtained from

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