Online tutoring startup Vedantu is in the process of raising $30 million in a round led by Tiger Global Management, with participation from WestBridge Capital, said two people familiar with the matter, requesting anonymity. The round will see Vedantu having a pre-money valuation of $100-110 million, they added.
The investment marks a departure for the New York-based hedge fund’s strategy, considering that it has mostly been backing new firms in the business-to-business (B2B) space in the last 8-10 months. It is also one of the first instances this year where Tiger Global is leading a round in one of its portfolio companies.
Tiger Global had previously invested in Vedantu in 2015. At that time, Lee Fixel from Tiger Global was handling the India investments. However, after Fixel’s departure from Tiger Global, investments in India are now being looked after by Scott Shleifer.
“This is the first time this year that Tiger Global is leading a round in one of its previous investee companies from the 2015 cohort," said the first person. “This is a deviation because their latest focus had been B2B, enterprise software-as-a-service (SaaS) and new investments."
However, Vedantu’s stupendous growth over the last year prompted Tiger Global to move in this direction, the second person said. “It has grown really fast and they had a few term sheets from different investors."
The company claims it has been growing at 30% month-on-month for the last six-seven months.
When contacted, Vedantu declined to comment on the development. Tiger Global and WestBridge Capital did not respond to Mint’s emailed queries till press time.
Founded by Vamsi Krishna, Anand Prakash and Pulkit Jain in 2014, Vedantu is an online portal offering coaching classes to students either in groups, or one-on-one sessions. It claims that around 9.8 million students access free content on the Vedantu platform and on YouTube, where the teachers conduct live sessions.
Last November, the company had raised $11 million in a round led by Omidyar Network, with contributions from existing investor Accel, and a $5 million infusion by China’s TAL Education Group. The money was used to deepen their presence in tier 2 and 3 towns.
It now has over 55% of its users from tier 2 and 3 areas.
Vedantu first raised money from Tiger Global and Accel in 2015 as part of its $5-million Series A round.
Experts tracking the space said this was an unusual move for Tiger Global, considering that under Schleifer, the fund was mostly making new investments so far this year.
Moreover, most of the over a dozen investments have been in the B2B and enterprise SaaS space such as in customer life cycle management platform CleverTap and agritech firm Ninjacart.
That said, Tiger Global has also infused money into some of its portfolio companies such as Razorpay, NestAway and Grofers.
Earlier this month, the firm had led a $75-million round in services platform UrbanClap, which was one of its first investments in the consumer internet space this year.
Other new investments by Tiger Global include logistics management software company Locus and enterprise cloud platform for the beauty and wellness sector, Zenoti.