Even as it witnesses a sustained boom in funds and global investor interest, the Indian edtech space is chequered by allegations of poor corporate governance. On the whole, it seems that many ecosystem players are now struggling to match corporate governance standards with their results and growth. This is the sense that one gets when looking at why the sector is now in the news—regular layoffs, accusations of unfair trade practices, overlooking consumer interest and lapses in book-keeping standards.
While investor interest in a nascent, but highly attractive, market is bringing in regular rounds of million-dollar valuations and capital, the sector must go back to the fundamentals of a good business. It must balance growth with integrity and accountability and embed a strong culture of ethical decision-making and checks and balances.
Without this, there is a very real risk of an imbalance between shareholder interest and student aspirations, besides the erosion of the trust of education providers, learners, parents and the wider community. Only by embracing best practices, enhancing transparency and prioritising ethical conduct can we build a resilient ecosystem that safeguards the interests of all stakeholders, while fostering an environment conducive to innovation, knowledge dissemination and holistic growth.
It is in this context that we must look at how we at Physics Wallah are trying to get it right.
Excellence as a Team
Every academic and operations team has its own quality excellence department, whose only goal is to monitor the quality of the output by training, inducting and auditing employees regularly. This takes the value of excellence from a good-to-do, aspirational abstract to something that has to be worked upon every day and measured against standards. Physics Wallah’s extensive, three-level training and certification programme is linked to appraisals, ensuring that team members are always equipped with the latest knowledge and skills. This also helps them grow further in their career within the company.
Cost consciousness is deeply embedded in the company’s psyche, not only because of fiduciary responsibility to shareholders, but because, as the leadership reiterates often, “every rupee comes from a parent from a lower rung of society”. This shapes decision-making at every level.
Marketing spends are tracked closely to ensure strong RoIs, and overheads, even those allocated to the company’s top deck, are highly frugal in a very real sense of the word. It is common to see start-ups, upon receiving a large volume of funding, add a line-up of vice-presidents, directors and the like, before working their way down and populating the ranks with managers and so on. Physics Wallah has done exactly the opposite by filling up its offices with a large number of highly capable freshers led by a lean team at the top. This serves the company well in two ways. First, the speed at which plans are turned into actions is swift, because plans are deployed immediately, without trickling down from leadership to senior manager to team leads to operations. Second, compensations are prudent and focused on those who do the work than those who get the work done by others. Of course, once they prove themselves, many of the joiners are put on the management track and have immense opportunity for upward growth.
While serving content and coaching across a large number of categories, like JEE, UPSC, GATE, etc., the backend operations are handled by a central team to ensure quality and process under control. Operations people, thus, work across categories and act as common repositories of the company’s best practices, which are shared with new hands as and when needed. This decentralised approach has allowed Physics Wallah to scale quickly and onboard new categories. Hiring a new person for the same function for every new category leads to bloated teams and wasted bandwidth, and that is not frugal and not in line with the Physics Wallah way of doing business.
Transparency and Responsibility
Best practices are only worth their salt if they can stand up to shareholder scrutiny and demonstrate a linear link between protocol and performance. Physics Wallah has created a commendable system of regular check-ins, meetings and other engagements with shareholders, who are kept abreast of crucial financials, performance indicators and other essential metrics, and how it all adds up to revenue growth, profit margins, return on investment and cash flow. Physics Wallah’s commitment to transparent communication has engendered a sense of confidence that the capital is being channelised well and the company is responsibly course-correcting wherever needed.
Incorporating diversity and inclusion practices has helped Physics Wallah in a plethora of ways. It has brought on board new perspectives that reflect India’s rich diversity and made outreach and programmes more in line with what students across geographies and strata want. The ideas and perspectives that shape Physics Wallah’s decisions, thus, are more relevant to parents, children, communities and other stakeholders in the education ecosystem.
This common approach to people, products and processes has served Physics Wallah well. Flexible enough to support the company’s forward plans, it also offers the edtech sector a strong foundation on which to align itself to the common reality of serving India’s strong unmet need for affordable, high quality and engaging education. Thus, ensuring effective corporate governance in an edtech company ultimately revolves around prioritising students as the focal point of all endeavours. By placing students at the core of their operations, edtech companies can create a seamless and impactful learning experience, fostering an environment that empowers both learners and educators, cultivating trust, driving innovation and fulfilling their mission of delivering high-quality education to the next generation.
Prateek Maheshwari is the co-founder of Physics Wallah