Unacademy to exit offline centres, shift to franchise model, founder Gaurav Munjal tells employees

“Over the coming months, we will exit our company-operated centre business by converting them into franchise partnerships," Munjal said in an email to employees on 14 January. Mint has reviewed a copy of the email.

He added that the company’s franchise model has shown that it works with local operators, runs operations, and Unacademy’s academics, technology and reach. “It is asset-light, capital-efficient, and aligned with who we are. By April, when this transition is complete, Unacademy will have one of the healthiest cost structures in the sector," Munjal said.

The shift comes after edtech firms spent the past five years prioritising profitability and reining in growth as funding dried up. As the covid-driven online learning boom tapered off from 2022, Unacademy expanded into offline centres to sustain growth. The latest move signals the company’s renewed push to return to its online-first model and focus on digital business.

"Unacademy will be an online-first company moving forward. Like it was when we started in 2015," a company spokesperson said in response to Mint's queries.

Hiving off Airlearn

Unacademy has been on the block for over a year, with founders Gaurav Munjal and Roman Saini exploring ways to hive off Airlearn, its high-growth AI language learning vertical, as the company struggled to reset after edtech’s post-pandemic slowdown and its pivot toward offline test preparation.

A person in direct knowledge of the development told Mint that Munjal and Saini will both continue with the company, and the plans to hive off Airlearn have been dropped.

Sumit Jain, who was to run Unacademy as an offline test prep business, will continue as the CEO of the vertical. “There is no change as test prep still has many verticals like Unacademy, PrepLadder, franchisees and other businesses. Jain will continue as the Test Prep CEO, while Munjal will remain the Group CEO," the person quoted above added.

This comes after a potential acquisition of the company by upGrad, seen as one of the biggest consolidation moves in India’s edtech sector, fell through earlier this month.

Multiple discussions around Unacademy’s sale have fallen through over the past two years, including talks with other edtech players, as valuation expectations failed to align with market reality.

In November last year, upGrad proposed a share-swap deal that was expected to value Unacademy at $300–400 million, a steep drop from its $3.4 billion valuation during the 2021 funding boom. Backed by SoftBank, Temasek, Tiger Global, Sequoia Capital and Peak XV Partners, Unacademy has raised about $880 million since inception.

Correction or rejection?

Advisors tracking the segment believe the pullback from online education over the past few years reflects a market correction rather than a rejection of the model.

“What we saw was a correction of excesses built during the pandemic, not the end of digital learning," said Ketan Mukhija, partner and co-head of PE and VC at Kochhar & Co. He added that a renewed push into online education can be “commercially rational if it is driven by disciplined execution rather than growth-at-all-costs."

According to Mukhija, demand for digital learning in India “has not disappeared; it has matured," with consumers becoming more discerning on quality, outcomes and trust.

However, any revival will favour platforms that “recalibrate expectations, strengthen compliance and consumer trust, and build sustainable unit economics."

Over the long term, online education will continue to grow, he said, but “it will reward prudence over scale and credibility over hype."

Not survival, but growth

In the email, Munjal said that after a long period of burn reduction, and cutting down its burn to roughly ₹200 crore in CY2024, the company plans to focus on growth again.

He added that the company saw many verticals turn profitable. “UPSC, NEET PG, CAT and multiple other verticals turned contribution-margin positive. PrepLadder and Graphy were cash-flow positive for the full year. Airlearn grew from ~$200K ARR at the start of 2025 to almost $3M ARR by year end."

He added that the company saw many verticals turn profitable. “UPSC, NEET PG, CAT and multiple other verticals turned contribution-margin positive. PrepLadder and Graphy were cash-flow positive for the full year. Airlearn grew from ~$200K ARR at the start of 2025 to almost $3M ARR by year end."

CY2026 is not about survival, it is about growth, Munjal said. “Unacademy has always been exceptional at one thing: building great online learning products…When we do that well, at scale, the business works. The economics work. The impact works. So we are going back to our strengths," he added.

Unacademy’s revenue fell 16% year-on-year to ₹826.2 crore in FY25 from ₹988.5 crore in FY24, even as its net loss narrowed to ₹435.4 crore from ₹631 crore over the same period.

The company, in its core coaching business, competes with hybrid players like Physics Wallah, Allen, and Aakash, among others.