Upgrad Buys Unacademy For Over $200 Mn, Nearly 94% Off 2021 Peak Valuation

UpGrad has completed the acquisition of Unacademy for just over $200 million, about 94% off its 2021 peak valuation, with co-founder and CEO Gaurav Munjal acknowledging the steep markdown in a post on LinkedIn.

Munjal wrote that the company became a unicorn (a privately held firm valued at more than $1 billion) six years ago. Unacademy had raised capital at its peak valuation but was ultimately sold for a fraction of that amount.

"Six years ago today, Unacademy became a unicorn. Today, Unacademy has closed its acquisition by UpGrad for just over $200 million. We raised at a peak, but sold at a fraction of that. I'm not going to dress these facts up," Munjal wrote on LinkedIn.

While Munjal did not quantify the exact markdown in his post, it may be recalled that back in 2021, Unacademy had raised $440 million (about ₹3,270.8 crore at that time) in funding from a clutch of investors including Temasek, General Atlantic, and Softbank Vision Fund, valuing the edtech major at $3.44 billion.

The acquisition price of just over $200 million is, therefore, about 94% lower than Unacademy's peak valuation.

Unacademy, Munjal said, sought to democratise education and helped establish a model for online learning in India.

"...I am proud of what this team did between those two numbers," he said, candidly acknowledging the steep markdown.

Munjal further wrote that the company's free platform helped create a generation of prominent educators, whose YouTube videos collectively crossed 10 billion views.

He also highlighted Airlearn, which became one of the world's three most downloaded language-learning applications within two years of its launch. The business had fulfilled the ambition of creating a global consumer product from India, he said, highlighting the role played by all the founders.

"We always wanted to build a global consumer product out of India. We did," he said.

With a topline of around ₹400 crore, most businesses profitable or near-profitable, and ₹900 crore in the bank, the company had the option of continuing independently but chose to pursue a combination with UpGrad after discussions with founder Ronnie Screwvala.

"Nobody was forcing this. But sometimes, you are drawn towards a path that is more exciting than the one that makes you more money," Munjal said.

According to him, the merger represented a better path for India's education ecosystem. Munjal expressed confidence that Unacademy's shareholders would create significant value from the deal.

He also credited employees, educators, investors and co-founders, noting that Unacademy had conducted four employee stock-option buybacks that created value for staff.