The Chan-Zuckerberg Initiative (CZI), founded by Facebook founder Mark Zuckerberg and his wife, Priscilla Chan, is making its first investment in Asia in Bengaluru-based Byju’s, a learning app. CZI will co-invest in the $50-million round in Byju’s along with Sequoia Capital, Sofina+ , Lightspeed Ventures and Times Internet, the digital arm of the Times Group. Byju’s had raised $75 million from Sequoia and Sofina in March this year.
The latest round of funding is said to have valued the company at around $500 million. The company declined to confirm the valuation. Byju’s will use the $125-million funding corpus of the last two rounds for international acquisitions and expansion in other English-speaking countries, its founder Byju Raveendran told TOI. He said the company has generated Rs 120-crore revenue in the first five months of the current fiscal year and the India operations are making profits.
“The Chan-Zuckerberg Initiative supports innovative models of learning wherever they are around the world,” said Vivian Wu of CZI, who will join Byju’s board. “Education can give young people and their families a path to a better future, and families in India work hard to give their children that chance. Byju’s represents an opportunity to help even more students develop a love for learning and unlock their potential.”
Satyan Gajwani, vice-chairman of Times Internet, said: “Byju and team are democratizing access to high quality education. Times have always believed in the power of digital education and its potential social impact for India. We are excited to join him in his journey, along with Mark and others.”
Byju’s was founded in 2011 as a test preparation business, helping CAT aspirants crack the exam. It expanded into other competitive exams and for many years operated through physical classrooms. It also moved on to video classes a few years ago. But the big explosion in reach happened with the launch of a mobile app last year. The learning app saw over 5.5 million downloads and 250,000 paid annual subscribers within a year of its launch. The app helps in effective learning programmes for students from classes 4 to 12 and competitive exams like JEE, NEET, CAT, IAS, GRE and GMAT.
“What Zuckerberg liked about us is that we have consumers in over 1,200 towns in the country and not just in metros. We also had a retention rate of 90% of our last year’s consumers,” Raveendran said. CZI was launched to advance human potential and promote equality, makes private investments and participates in policy debates.
World Bank arm IFC is also considering investing in Byju’s. The company has so far raised $155 million. The founders still hold the majority stake. Its early investor, the Ranjan Pai and Mohandas Pai-led Aarin Capital+ , which invested in the company in 2013, has largely sold their stake for a four-times return over the past few months.
Raveendran said courses are designed to adapt to the unique learning style and pace of every student. “Once children fall in love with learning, they will start learning on their own. That’s why Byju’s products are built in ways that inspire children to take initiative and learn on their own,” Raveendran said. Raveendran was born to parents who were both teachers and hails from Azhikode, a small village in Kerala. “With an average engagement rate of 40 minutes per day, we are proving to be effective at improving learning outcomes and engaging India’s students,” Raveendran said.