The learning curve

Touted as Bollywood diva Sridevi’s comeback vehicle, English Vinglish was one of the most-anticipated movies of 2012. But when audiences walked out of theatres (or turned off their screens) after watching the film, it was to talk not about the star, but her role: of Shashi Godbole, the Maharashtrian housewife from English Vinglish who smiles through her family’s taunts at her sub-par English language skills. Humiliated for her inability to speak English, Shashi joins a four-week course at a language school, and the movie ends on a happy note with Shashi making a heartfelt climactic speech in fluent English.

The movie is inspired by countless true stories of people struggling in their personal and professional lives due to their inability to interact in English. Vivek Agarwal, CEO of English language product and training company Liqvid eLearning, says almost everyone aspires to converse in perfect English. “In a scene straight out of the movie, a housewife once told me she wished to learn English because her son was too embarrassed to introduce her to his friends,” says the 42-year-old IIM-C grad. In a country where an elementary understanding of the language can increase social mobility, serve as common ground and open up job prospects, failure to grasp English can prove to be a handicap.    

Liqvid (derived from ‘liquidus’, the Latin word for fluid, and ‘vid’, the Sanskrit word for ‘to know’) is trying to address this need. Agarwal and his friend Manish Kumar pooled in ₹4 crore from personal savings and loans from friends and family to start Liqvid in 2002. “People want to learn English primarily for three reasons: to secure a better job, to pass an exam or study in an English-medium institute and to be able to interact better with their social circle,” Agarwal says. He reels off statistics in favour of English. “There was an article three months ago in Harvard Business Review that said around 25% of the world’s population converses in English. It has become the language of business and opportunity. For English Edge, the market is not just India, but several other non-English speaking countries,” says Agarwal.

ABCs of start-up

Predictably, this makes teaching English a business proposition as well, and Liqvid has capitalised on this. The company is the new-age equivalent of the brick-and-mortar spoken English institutes, using its own customised software, English Edge, to provide English language learning solutions. Posters for the software, which is compatible with PCs, laptops, tablets and smartphones, dominate the walls of the Noida-based company’s office, highlighting common mistakes such as: ‘She lives in my backside’, ‘Please open the fan’ and ‘Small-small children are playing’. Having worked with GE Capital in the past and founded e-learning company eGurucool.com, Agarwal was certainly not short of experience or skills when he launched his own start-up. Liqvid began by providing e-learning solutions globally before launching its proprietary software in 2007-08.

English Edge uses multimedia and interactive features such as a record-compare tool for correct pronunciation and visual cues for intonation, so that classes are not monotonous. The software is custom-designed for schools, colleges, vocational institutes and corporate and government offices. The teaching methodology also differs for kids and adults. For the latter, the software is equipped to teach English in nine regional languages. “Grown-ups find it difficult to grasp the language, so we teach them basic social interaction in their own languages. The school curriculum is more academic, where we teach students the basics of grammar,” says Agarwal. 

The program was first launched at the British Council, which then became Liqvid’s first customer. The company tied up with the BBC in 2005 for content, and the latter trained Liqvid’s team of language and technology experts in designing the curriculum. Since then, Liqvid designs its own entry-level courseware, using the BBC’s coursebook for advanced courses and giving it a royalty on every sale of the software. Its portability has made English Edge extremely popular in schools. Here, Liqvid offers a ‘portable language lab’, which is a compact trolley that houses up to 40 tablets with English Edge preloaded on them, a Wi-Fi router and a projector. “The teacher uses a master tab connected to all the other tabs, enabling real-time two-way interactions in class,” says Agarwal. In semi-urban areas, Liqvid supplies course books instead, with the software pre-installed on a desktop. 

With more than 200 institutes in 500 locations using the software, Liqvid has been able to reach out to nearly 250,000 students. It has several big clients such as the DPS chain, IIT Delhi and Jamia Milia Islamia. The software’s content is aligned to the National Curriculum Framework for Classes I-X. The teaching methodology during the suggested weekly one-hour sessions remains the same for all classes, with only the difficulty level increasing each year. Gyanandni Rawal, 22, who takes English Edge lessons as part of her MSc curriculum at Allahabad University, says, “The course has many stages of learning and difficulty that we have to move through. Many of the students who come here are from vernacular backgrounds, so it is very helpful for them.”

GK Rai, director of the Institute of Professional Studies at Allahabad University, agrees. “Most of our students come from the Hindi heartland and they are not conversant in English. We came across English Edge two years ago and have been using it ever since.” 

Learning and growing

Liqvid’s 150-strong sales team markets its products directly to schools, colleges and vocational training institutes. The company is now looking to tap into rural markets as well. “We have signed up with the Orissa government to provide our software in 13 remote tribal areas, benefitting 6,000-7,000 people,” says Agarwal. For such tie-ups, the state pays Liqvid a licence fee and the cost of the software. Usually, the firm charges a per learner fee or licenses its software to the client for a year. “We charge between ₹500-5,000 per learner per programme for a single course of 60-100 hours. Where there are more than a 1,000 learners in one place, we license the software for close to ₹2-3 lakh a year,” he says. The company is happy with its revenue stream and is not interested in setting up coaching centres. 

Multiple levels of encryption protect the software, and it can’t run on a device unless it is licensed by the firm. Individual elements have also been encrypted, in addition to authentication via central servers. The company is funded by Bedrock Venture Management, which invested $1 million in 2010, and by Japanese venture capital firm SBI Holdings, which put in $3 million last year. Vivek Bihani, director, Bedrock, says, “Liqvid is completely focused on spoken English, while every other company looks at curriculum development. The spoken English market is unorganised and very fragmented. There was a clear space for a brand to come in.”

Liqvid is expected to clock about ₹25 crore in revenues by March 2014, with 25% operating margin. The firm has been growing at a 30-40% CAGR since 2005. While revenues are split 50-50 between English Edge and its e-learning solutions for corporates, Agarwal expects this ratio to soon change to 80:20. Once it has a pan-India presence, he plans to take English Edge to other non-English speaking countries in Latin America, Africa and West Asia.

The other big expansion Liqvid is looking at is entering the B2C segment. “We want to make our software available to everyone through our website, so that anyone with an interest in English can buy it,” he says. “Agarwal has B2C experience from eGurukool and that will come in handy in knowing what to do,” says Bihani. “My estimate is that we would require close to $500,000-1 million in investment over the next year to move into the B2C segment,” says Agarwal. With his partner, he has invested $5 million in Liqvid so far through equity, debt and convertible debt.

“A key challenge for us is competition from Pearson and English language software firms. But we are the only ones focusing on contextual software specific to Indian conditions and that’s our biggest differentiator,” he adds. Here’s hoping growing competition doesn’t leave Liqvid tongue-tied.