Edtech Investors Are Interested In The Indian market: GSV Ventures; A Glimmer Of ‘Hope’ Amidst Massive Layoffs In 2023

GSV Ventures, a U.S.-backed firm has made two prominent edtech investments in India, which are the test preparation firm, named PhysicsWallah, and LEAD which provides a digital infrastructure to schools. Both companies have a valuation accounting for more than a billion dollars.

India is one of the most exciting markets in the world for edtech investors. The statement has been brought to light by the venture capital firm GSV Ventures. It comes on a positive note for a sector that has gone through massive layoffs and a shortage of funding in recent times.

GSV ventures is a U.S.-based venture capital firm that invests in only edtech startups around the world and manages assets worth 500 million USD. The company has made two prominent edtech investments in India, which are the test preparation firm, named PhysicsWallah, and LEAD which provides a digital infrastructure to schools. Both companies have a valuation accounting for more than a billion dollars.

The managing partner at GSV has opened up to legitimate sources on the sidelines of the recent Emeritus-GSV Leaders Summit in New Delhi, stating that it is way too early to be negative about India’s edtech industry. India is still the most exciting market for ventures along with the U.S. These are the early days for the Indian edtech market.

In recent months, edtech startups have gone through massive restructuring processes and laid off thousands of employees in the previous year. They have even been unable to raise funding for edtech startups as the global slowdown has severed the economy.

Companies that have handed pink slips to the staff include Unacademy, backed by the SoftBank, Vedantu backed by Tiger Global, and Byju’s, which is regarded as the biggest startup in India, and the valuation stands at 22 billion USD.

_Edtech Unicorns

Yet other sources have claimed that the economic slowdown has caused a shakeout, that has enabled the successful companies to expand their shares in the market while the other competitors exited.

Quazzo has stated that companies previously operating online have gone completely hybrid. This has helped to increase their market sizes. Previously, the companies did not operate sensibly, and they were often shut down.

An increase in digitalization, a wide base of the young population, and expected growth from the per capita income have made Indi an attractive market for edtech investors.
GSV has been looking for investments in the sub-sectors, which involves the K12 segment and upskilling among other courses.

Quazzo has stated that GSV has invested around 90 million USD in India so far. The U.S. investments in the venture involve Coursera and Masterclass.

The edtech startup has raised a valuation of 2.6 billion USD in 2022, which is 36 percent down from the valuation raised in 2021. The data has been collected by the data provider Tracxn Technologies.
Quazzo has even asserted that there are companies that are doing better, even if it seems the contrary on the surface. Some specific edtech companies may have difficulties, but the Indian market is still very bullish. The Indian government has been constructive on education policies, which is a key factor that has intrigued edtech investors like the GSV to invest in India.

The Indian Edtech Sector has been leading complaints, not a bright market at present:

Edtech startups

The year 2022 ended with 30 EdTech unicorns valued at just under $100 billion. To put things in perspective, we can consider that the combined value of these businesses is chasing after economically important Fortune 500 companies like General Electric and American Express.

EdTech, along with its leaders, operators, and mission that continue to expand into more verticals and geographies, is back in the race towards a more equitable future with consistent growth anticipated into the next ten years.

But, The Indian edtech sector- which according to analysts, has 37 million users and is valued at 10.4 billion USD by the end of 2025 has been gaining complaints. The edtech platforms have been promising to revolutionize traditional classroom learning with the incorporation of online courses and state-of-the-art pieces of equipment, but the situation does not look so bright as the consumer complaints forum has been receiving a large number of complaints. They have even accused such companies of indulging in malpractices to force parents to buy their courses.

As of now, there are 3833 complaints against Byju. Of which, 1403 have been resolved Simplilearn has received around 390 complaints.

Most complaints have been about the users failing to receive the refund after the trial period has been over and the students being unable to access the course after paying for it. There have been complaints about some platforms like Liddo learning that have been closed down after receiving full payment.

Edited by Prakriti Arora

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