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MUMBAI : Upgrad, the upskilling edtech unicorn, is keen to shed the image of a ‘startup’, preferring to be seen as an established business in the education segment, co-founder Ronnie Screwvala said.

Screwvala believes Upgrad is much more than a startup and calling it one hurts the business.

“We don’t see ourselves as a startup because I think it’s very dangerous in education if you are a startup impacting lives and careers. So, that’s why ‘funding’, ‘unicorn’, ‘startup’ are not words that bring us any satisfaction or pleasure," Screwvala said in an interview. “How will a five-year-old company compete in mindset with a 50-year-old or a 100-year-old establishment unless you shirk that (tag) off?"

Screwvala’s stance appears unorthodox as even mature companies aspire to imbibe aspects of how startups work to make their organizations nimble, energetic and innovative. In addition, many large companies are shifting from a command-and-control leadership style to delegating decision-making lower down the organization, similar to how startups work.

While Screwvala may still retain the company’s functioning style that has helped the seven-year-old company scale rapidly, he believes that the startup tag is a handicap, at least for an education company. Widespread layoffs by education startups amid the current funding winter, questionable sales practices and startups shutting down, leaving students stranded, have brought some disrepute to the sector.

According to Screwvala, Upgrad has achieved a critical mass after acquiring and partnering with more than half a dozen brands and companies across segments such as upskilling, job readiness, recruitment and overseas education.

Some of the companies it has acquired include Harappa Education, Exampur, Talentedge, Study Partners, Work Better, Knowledgehut, Impartus Innovation and Rekrut India.

“We will continue to be acquisitive to plug holes in terms of our life-long learning and re-skilling value chain—and part of our focus will be global markets," Screwvala said.

“We are working at deepening our presence across each of these segments that we have now. We are likely to reach $400 million in annual revenue run rate (ARR ) by 31 March—as by then our Jan-March quarter will see a $100 million gross collected revenues," he said.

A large part of the company’s future non-linear growth will come from its overseas education business, where it plans to bring overseas campuses to India, he said. India is a massive market, and the skilling segment will grow organically, he added.

The company clocked $250 million in revenue in FY22 and is planning an initial public offering in the next 18-24 months, he said.

Upgrad has so far raised close to $280 million in primary capital from investors and an additional $100 million via a stock swap. It was last valued at $2.25 billion. Last year, it raised $160 million from Temasek Holdings Ltd, International Finance Corp. (IFC), and IIFL Group.

At a time when the larger edtech sector is under pressure as the covid pandemic wanes, and with the funding taps drying up, Screwvala said that it does not take a lot of capital to build a sustainable business in the education segment.

“The demand for upskilling and higher education will not go away. Deep-pocketed investors still see value in the sector. It is just a matter of which segment you are playing in. K12 is not where there is any headroom. Too much zero-cost capital has already got into that segment, with investors and founders on steroids on fundraising vs building an integrated real business," he said.

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