Unacademy to close offline centers, shift to franchise model
What's the story
Unacademy, a leading edtech firm backed by Temasek, is planning to shut down its company-operated offline centers and transition to a franchise model. The move was announced by founder Gaurav Munjal in an internal email to employees. Munjal emphasized that the franchise model has proven successful with local operators managing operations while Unacademy provides academics, technology, and reach. He described the new strategy as "asset-light" and "capital-efficient," which aligns with the company's core values.
Business focus
Returning to online-first model
The shift comes as edtech firms have been focusing on profitability amid funding challenges. After the COVID-19-driven online learning boom faded in 2022, Unacademy ventured into offline centers for growth. This latest move shows the company's renewed commitment to its online-first model and digital business focus. "Unacademy will be an online-first company moving forward," a company spokesperson said in response to Mint's queries.
Discussions
What about Airlearn?
Unacademy has been on the block for over a year, with founders Munjal and Roman Saini exploring ways to hive off Airlearn, its high-growth AI language learning vertical. This was amid the company's struggle to reset after edtech's post-pandemic slowdown and its pivot toward offline test preparation. However, plans to hive off Airlearn have been dropped as both Munjal and Saini will continue with the company.
Market hurdles
Challenges in acquisition talks
The latest development comes after a potential acquisition of Unacademy by upGrad fell through earlier this month. Numerous discussions around the sale of the company have failed over the past two years, including with other edtech players, due to valuation expectations not aligning with market reality. In November last year, upGrad had proposed a share-swap deal valuing Unacademy at $300-400 million, much lower than its $3.4 billion valuation during the 2021 funding boom.
Future outlook
Unacademy plans to focus on growth in 2026
In his email, Munjal said that after a long period of burn reduction, the firm plans to focus on growth again. He noted that many verticals have turned profitable, including UPSC, NEET PG, CAT and several others. "PrepLadder and Graphy were cash-flow positive for the full year," he added. "Airlearn grew from ~$200K ARR at the start of 2025 to almost $3 million ARR by year end."