Unacademy acquired by upGrad at $206 million, 94% below 2021 peak valuation

Unacademy, once one of India’s most valuable edtech startups, has been acquired by rival upGrad at a valuation of just over $200 million, about 94% less than its 2021 peak valuation.

The all-stock deal values Unacademy at ₹19.55 billion (about $206 million), upGrad’s co-founder and chairperson Ronnie Screwvala told TechCrunch. Unacademy shareholders are receiving upGrad shares as part of the transaction, while angel investors were cashed out at closing, Screwvala said.

On Monday, Unacademy co-founder and CEO Gaurav Munjal said in a post on X that the deal had closed, nearly six months after the transaction was first announced in March. The Bengaluru-based startup, backed by SoftBank, Tiger Global, General Atlantic and other global investors, was valued at $3.44 billion at its peak in 2021.

“We raised at a peak, but sold at a fraction of that,” he wrote. “I’m not going to dress these facts up.”

The deal comes despite Unacademy having about ₹9 billion (about $94.8 million) in the bank and annual revenue of roughly ₹4 billion (around $42.13 million), Munjal wrote. He said most of the startup’s businesses were profitable or close to profitability, and said the company had the option to continue operating independently.

Founded in 2015, Unacademy spent heavily in 2020 and 2021 as it battled rivals such as Byju’s for students and educators as pandemic lockdowns sent demand for online learning soaring. However, after physical classes reopened and demand for edtech plummeted, the startup cut costs, laid off employees, and restructured parts of its business.

Unacademy eventually brought most of its businesses to profitability or close to it, Munjal said. “Nobody was forcing this,” he wrote.

Nonetheless, Unacademy’s leadership had come to believe that getting the startup to the scale or an eventual public listing would require expanding into more areas of education, according to two sources familiar with the matter. Joining upGrad, which has built a larger presence in offline education, offered one route to doing that, the sources told TechCrunch.

Airlearn, Unacademy’s language-learning app, is also part of the transaction, and will remain under upGrad for now. Screwvala said upGrad was “very excited and positive” about the business.

However, in about six months, Munjal and Screwvala are expected to decide whether to continue building the about 25-person business internally or raise external capital for it, according to one of the people.

Late last year, Munjal had explored raising external capital for Airlearn and received term sheets from investors, but ultimately abandoned those plans as talks with upGrad progressed, the person familiar with the matter told TechCrunch.

“To see a product coming out of India gaining traction globally is a great example of what is possible when the thinking, product and ambition are not limited by geography. India to the world is a very real opportunity, and Airlearn is already showing us a glimpse of it,” Screwvala wrote on X.

The two-year-old online platform serves 10 million users across over 150 countries, Unacademy said. The edtech group overall has amassed over 10 billion views for its free education videos on YouTube.

The Unacademy brand will be retained, and the deal covers the entire group, including PrepLadder and Graphy. Munjal will continue as Unacademy’s CEO and lead the business as before, with a focus on its online operations and Airlearn, Screwvala told TechCrunch.

No layoffs are planned, according to one of the people familiar with the matter. Unacademy Group has about 1,000 employees.