Coursera India market may surpass that of the US and Europe says CEO Jeff Maggioncalda
- ByStartupStory | October 25, 2022
Over the next 18 to 20 months, India is anticipated to outgrow its home market, the United States, and even Europe in terms of student enrollment, according to Jeff Maggioncalda, CEO of edtech company Coursera.
It is anticipated that the corporation will surpass the United States and Europe given its 17 million learners and content relationships with 15 Indian colleges.There are 19 million students in Europe and 20 million in America.
The 850 million young people in India are a significant source of human capital. I believe McKinsey predicted that 20% of the world’s workforce will be located in India. So, Maggioncalda explained during a face-to-face conversation, “we are really thinking long-term and focusing on where the human capital is.
The remarks have been made at a time when geopolitical tension, pressure from global inflation, and worries about rising interest rates have had an impact on public markets and caused a collapse in global technology equities.
As investors and entrepreneurs get ready for a “funding winter,” all of India’s biggest edtech companies, including Byju’s, Unacademy, and Vedantu, have announced cash-conservation measures and sacked staff.
“This economy (India’s) is gaining a lot of speed in all directions. In spite of the economic slump, India continues to feel far more vivid than North America, and North America feels brighter than Europe. But Europe is in a difficult situation.
However, he noted that the Indian edtech sector continues to be a significant possibility for mergers and acquisitions as investors refrain from signing larger checks.
“Today, a lot of money has been invested in edtech (in India), and perhaps those business models aren’t working out exactly the way they should. M&A may be one method of investor liquidity that is becoming more significant in India. Additionally, there isn’t a very appealing or open public market, and private funding is currently declining, according to Maggioncalda, who took over as CEO of Coursera in 2017 and went public with the company in March 2021.
Before accepting the top position at Coursera, Maggioncalda served as the founding CEO of the US-based investment advisory firm Financial Engines.
Maggioncalda stated the following regarding Coursera’s acquisition roadmap: “We are cash flow positive and have $750 million in cash on the balance sheet with no debt. Public currency is also available. We think that adding additional assets to our platform will undoubtedly increase its value due to distribution. Although we haven’t actually made any significant decisions, I believe the market for M&A is getting ready.
For the second quarter ended June 30, Coursera reported total revenue of $124.8 million, an increase of 22% from $102.1 million in the same period last year.The period’s gross profit was $78.4 million, up 29% from $60.9 million the previous year.
Maggioncalda stated that despite the company’s efforts to concentrate on its strengths in collaborations with corporations to upskill their workforces and with universities for content, Coursera does not currently have any plans to enter the offline market.
In order to be in a position to assist, he explained, “our focus right now is developing partnerships on the supply side and creating distribution.”
Byju’s, Unacademy, PhysicsWallah, and Vedantu are just a few Indian edtech companies that have heavily invested in expanding its offline brick-and-mortar footprint through acquisitions or the creation of new centres.
We are putting up a fight against investing in tangible assets or going offline. We will also avoid teaching that is centred on the needs of the students. Simply said, there are too many teachers in the world for us to believe that ours will be superior to all others. We will continue to be a platform model because we excel at technology and distribution, according to Maggioncalda.
Top universities in India have partnered with Coursera to offer their courses online. These include, to name a few, BITS Pilani, IIM Ahmedabad, IIT Bombay, IIT Roorkee, IIT Guwahati, and IIM Calcutta. To upskill workers, it collaborates with 150–180 Indian firms.
During the June quarter, the edtech company had over 1.9 million new course enrollments in India. 4 million enrollees made up the total for the first half.
The global slump has also affected Indian edtech, which is also struggling to conserve cash and posting significant losses. Leaders in edtech, like Vedantu and Byju’s, are currently attempting to rush into the open marketplace.
“Any business that isn’t earning cash should be considering how it will get its next cash flow. Therefore, keep an eye on your finances and always be prepared to live independently. Definitely, the IPO market is more selective than the private markets. If you’re having difficulties in the private markets, don’t expect that the public markets can save you, Maggioncalda advised.
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