Edtech giant PhysicsWallah raises $210 million at $2.8 billion valuation
What's the story
PhysicsWallah, a leading edtech company, has successfully secured $210 million in its Series B funding round.
The investment was led by Hornbill Capital and included participation from Lightspeed Venture Partners, GSV Ventures, and WestBridge Capital.
This latest financial injection has significantly increased the company's post-money valuation to $2.8 billion, marking an impressive 2.5x rise from its previous valuation of $1.1 billion.
Company evolution
PhysicsWallah's journey and previous funding
PhysicsWallah was established in 2016 by Alakh Pandey, a teacher turned entrepreneur.
The edtech firm had previously raised $102 million from WestBridge and GSV Ventures in its initial funding round.
The latest round is one of the largest primary capital raises in the edtech sector recently, indicating renewed investor confidence as companies transition back to traditional learning methods while incorporating digital innovations.
Revenue growth
PhysicsWallah's financial performance and future plans
In FY23, PhysicsWallah reported a threefold increase in operating revenue, reaching ₹772 crore on a standalone basis.
This surge was primarily fueled by the company's expansion into offline education, which now contributes approximately 45% of its overall revenue.
Co-founder Prateek Maheshwari revealed that the edtech firm has over ₹1,200 crore in the bank to fuel its expansion and will utilize the fresh capital wisely to scale up.
Expansion strategy
PhysicsWallah's strategic expansion and acquisition plans
With the new capital, PhysicsWallah plans to significantly bolster its operations. The company aims to establish localized education centers, known as Micro hubs, to enhance accessibility for students across India.
It will also continue exploring mergers with community-driven education platforms to strengthen its market position.
"Our strategy is to avoid mega centers like Kota due to the high concentration of students and associated challenges," Maheshwari said.
Acquisition approach
PhysicsWallah's acquisition strategy and future outlook
PhysicsWallah has previously acquired smaller firms such as Xylem Learning, PrepOnline, Altis Vortex.
"We are exploring opportunities in different geographies, particularly the South. We are also seeking smaller, growing platforms, particularly led by teachers, that share our philosophy of community building and have a brand affinity similar to PhysicsWallah," Pandey said.
Despite a dip in profits in FY23, Maheshwari and Pandey remain optimistic about the future with Pandey stating that "FY25 will be our highest absolute EBITDA year."