It is ironic that a company that seeks to distribute knowledge is named Unacademy. [Un (Not)-academy].
Gaurav Munjal had come across a concept of ‘Unconference’ during his college days. Unconference is everything that a conference isn’t. No specific agenda, anyone can attend, anyone can talk about anything interesting, you can wear whatever you want, you can attend whatever talk you want. This particular term remained embedded in the back of Munjal’s mind and was unearthed in 2010. This time it was not a college conference but the education industry.
Unacademy.in is supposed to be everything that a traditional academy isn’t and more, explains Munjal, who turned this vision into business in 2010 with two other co-founders – Roman Saini and Hemesh Singh.
Tapping Business Opportunity Behind Hobby
Unacademy had started out as a Youtube channel. Munjal, a college student, was no alien to the world of ‘Youtubing’, both for leisure and business. During his college days itself, he started posting educational videos about computer programming on the channel.
As time progressed he started his own real estate company, Flatchat, which later got sold to Common Floor in the year 2014. In the same year, Munjal began observing the niche of digital education, owing to the popularity of his videos, and decided to go full time with his channel.
To understand the potential of digital education better, he shared the start-up idea with his peer Roman Saini, who was at the time serving as an Assistant Collector of Jabalpur in Madhya Pradesh. Saini, who himself had once taken a loan from a friend to pay for his hefty coaching centre fee, was moved by the idea of learning from the comfort of home at much lesser fees.
Thus with the mission to make education accessible, break the restrictive classroom-learning structure and augment the teaching and learning process, he came on board. It soon became a trio as Hemesh Singh, who had been with Munjal since his Flatchat days, joined in as Chief Technical Officer (CTO).
Unacademy started out as a humble YouTube education channel, focussing on preparation of competitive exams. Seeing the massive popularity of the channel within a short span, the founders decided to officially register Unacademy as an e-learning platform under its parent company Sorting Hat Pvt. Ltd. in 2015.
Gradually, it was joined by 36 new educators comprising IITians, CAs, IAS officers, teachers who contributed in making 500 free lessons on a wide range of subjects. Within a year, the start-up received its first round of funding of total $500K from Blume Ventures, Rajan Anandan of Google, Sumit Jain of CommonFloor, among others.
“The big money is not in the buying or selling, but in the waiting” – Charlie Munger, American businessman and investor.
When investors put in their money in a start-up, especially the one that initially does not have a very solid revenue model, it’s evident that they don’t do it for the short term returns. Rather, they see a long-term potential. Unacademy was on the right track. The main reason being it wasn’t trying to replace the traditional classroom teaching model or a teacher per se. Rather, augment the same with technology. The investors knew that the future was virtual and Unacademy’s product offering was in the right books.
By the end of 2016, they had about 100 educators providing 1,500 lessons. The start-up quickly managed to raise its Series A of $ 4.5 million by the start of 2017. The line of investors included – Blume Ventures, Sachin Bansal, Binny Bansal, Kunal Shah, Stanford Angels India, Nexus Venture Partners among others.
What upped Unacademy’s game was the unique idea of providing tailored courses in the competitive-test-prep market, which has a huge potential owing to its popularity. With investors flogging in, the company came up with “Unacademy Educator” – an app for educators to help them create videos from the comforts of their homes. From time management lessons to motivational talks, the start-up managed to get personalities like Kiran Bedi, famous cricketers Brian Lara, Brett Lee and Jonty Rhodes, Congress MP Shashi Tharoor and the star couple Virat Kohli and Anushka Sharma, as its official educators, increasing its credibility as an e-learning platform.
Today, Unacademy has as many as twelve platforms in the market ranging from the Unacademy Learning App to test prep app Graphy, with a monthly visit of 6,295,259 users.
What upped Unacademy’s game was the unique idea of providing tailored courses in the competitive-test-prep market, which has a huge potential.
From Freemium to Subscription: Finding PMF
Initially, Unacademy distributed their content in the form of mini courses for free. This approach was quite similar to the one adopted by Jio – Free internet for all. This Freemium Model is generally adopted by companies to amass a user base and gain popularity in the industry. Unacademy followed the Jio suit and allowed people to have access to their videos for free. However, they kept a certain category of premium videos saleable. This strategy worked well for the start-up as they were able to garner around 15 million views, with more than 52K registered users within a few months of start-up’s official registration.
The start-up was pumping its user base each month, reaching different regions and delivering personalised content. During the entire course of its journey, Unacademy made sure that it comes up with new products/apps/content to retain that user base and keep the quality at check. This is extremely important for a start-up which is in a space of aggressive competition, with everyone wanting a share in the billion dollar pie.
At an early stage of their venture, Unacademy had identified their target audience, especially in Tier 2 and Tier 3 regions. Since a significant fraction of its learners were based in remote towns and villages, the team started to optimise its lessons to load on low bandwidth connections and mobile data. The start-up smartly turned the challenge into an opportunity with technological prowess.
Unacademy achieved a turnover of 1.8 Crores in December 2018, with seven times higher revenue compared to the previous year.
Every start-up reaches a point where they question themselves – What next? In one of his blogs, Munjal shared, even though they had great revenue, growing month-on-month, something was missing – Product Market Fit (PMF).
They (team) knew live classes were working and learners were loving it but somehow they were hating the idea of buying different Plus Courses. The company needed a simple solution: One-stop-solution for cracking the exam. A solution where users could access the live classes in a structured manner by the best educators.
Following intensive brainstorming, the team decided to launch a subscription model, which would provide a structured and streamlined downloadable courses accessible to paid users.
The team started working on the subscription product on January 3 and made it live on January 29. The company had to build the entire framework, product and align 400 educators to launch subscriptions in 12 exam categories.
The revenue soured by 7x in 11 months. By the end of 2019, Unacademy was attracting a greater number of investors. However, an orbital shift in the start-up’s investment and numbers came after the pandemic, which brought in a tectonic shift in the online education industry. Edutech became a natural gainer as online learning moved towards becoming a necessity.
In May 2020, Unacademy touched an all time high with 3,50,000 subscribers. The start-up hit the iron when it was piping hot! Following the worldwide lockdown, Unacademy came out with blazing guns of intensive recruitment, scale up, fundings and new products to retain its position at the top of the Edtech space.
This gave the company the key to the billion dollar club. Unacademy hit the unicorn status in September 2020 after raising $150 Million from SoftBank Vision Fund.
Under my Umbrella!
As Edtech startups build a war chest amidst the fading galore, the natural course of action was acquisition to strengthen the product. In 2000 alone, Unacademy acquired six start-ups – Kreatryx, CodeChef, PrepLadder, Mastree, Coursavy and NeoStencil – in various sectors to solidify its position against its biggest competitor BYJU’S. Other deals included TapChief and e-learning site Handa Ka Funda.
Unacademy expanded its umbrella to accommodate a diverse user base, increase its market share and cashed in on the popularity of the acquired companies. Unacademy had been focusing on preparation for competitive exams (JEE, UPSC, NEET, CAT, etc.) and strengthened the same with smart acquisitions and tie-ups. There is also an advent advantage in this kind of content – scalability and wider adoption. The nature of the content (competitive exams) is easily replicable and scalable to be rechristened as multiple offerings.
Interestingly, in the second half of 2020, they started looking at the K-12 segment as well. Unacademy had started out with focusing on recorded content and creating tools for educators to create content. As interest for live learning space picks up pace, the start-up is also looking to venture into the segment.
The start-up had started to optimise its lessons to load on low bandwidth connections and mobile data.
No start-up has smooth sailing. When Unacademy started out, the industry saw less than 1% venture capital flow in India. A lot of experiments were ongoing – some developing, some sailing smooth while some crashing.
One of the biggest reasons why Unacademy has managed to survive and thrive to date is its ideation.
The reason why Unacademy didn’t fail like other edtech startups or aced its exam of revenue generation, was the idea behind it. This holds true for all the test-taking/preparation platforms. They didn’t aim to replace the teacher but to augment the teaching process.
Second, they picked up the aggressively popular ‘parallel education system’ as their core sector. Plus, they picked up courses/exams which need relearning like UPSC, which is an high-value intensive course.
The start-up faced stiff competition initially from BYJU’S, Toppr and Khan Academy, which at some point were also delivering free content. However Unacademy’s USP was the convenience with which educators delivered content. They kept bringing in more educators as collaborators with an exclusive app meant for educators, as popularity increased.
This provided content to be generated at the pace of its consumption, at the same time ensuring dynamism, something its competitors lacked. It is a very smart model where educators become the influencers and marketers for the company.
This makes Unacademy an extremely asset-light company. The educators app is the game changer. No need for fancy studios or attention capturing content. The app is unique as the – ‘Student is tutor, tutor is student’. Most of the educators are young pass-outs or teachers who have recently completed the same exams successfully. Unacademy is proud of its uniqueness and ability in making education accessible to the extent that people who earlier were its students have now turned into educators on the same platform.
The agility of the company in shifting its users to an app from Youtube channel is also commendable. This way they have been able to monetise the freemium model they had initially launched with the app-based subscription model.
Netflix of Education
What does Netflix do? It’s a single platform for all kinds of streaming services available to users on subscription basis. Unacademy aims to curate the same, but in education. It is already in that direction and briningin in new products to build it up.
The company gets top educators from different spaces together on one platform and optimises them together. The learner can choose the course and the educator he is the most comfortable with.
It is set to increase its product base in fields that are yet untouched such as courses on chess, judiciary exam preparations, Chartered Accountancy etc. They are aiming to bring K-12 subscription for school students as well.
Amidst the ongoing Covid-19 wave, there are little chances of colleges and educational institutions reopening this year as well. That being said, there stands a high chance of universities tying up with Unacademy and its likes and providing degrees or the start-up bringing its own degree courses in association with UGC.