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The proposed merger between India’s leading edtech players could reshape the sector as both companies vie for profitability and market dominance.
Unacademy, the prominent edtech startup backed by SoftBank, is in advanced discussions to merge with K12 Techno, the company behind Orchids International Schools, according to a report from Entrackr. The potential merger, which has been under negotiation for the past month, would see both companies share ownership equally, each holding a 50% stake in the newly formed entity.
Unacademy, which once ranked as the second most valuable edtech startup after Byju’s, has faced challenges in its quest for profitability. Despite a significant $440 million funding round in August 2021, led by Singapore’s Temasek Holdings and valuing the company at $3.44 billion, financial struggles have persisted. Founded in 2015 by Gaurav Munjal, Hemesh Singh, and Roman Saini, Unacademy had earlier hinted at nearing profitability.
K12 Techno, established in 2010, provides comprehensive education services to over 800 private schools in India, serving more than 300,000 students. The company has demonstrated impressive growth with a compound annual growth rate (CAGR) of around 40% over the past five years.
Recent investments include a $27 million stake purchased by Venturi Partners and additional funding from Kedaara Capital, which facilitated a partial exit for Peak XV Partners (formerly Sequoia Capital India).
As both companies navigate a challenging edtech landscape, their merger could significantly impact the industry, aiming to strengthen their positions and drive toward financial stability.
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