Edtech unicorn Vedantu inflated 4X in FY21 as employee expenses soar
- ByStartupStory | June 25, 2022
Vedantu, the unicorn edtech company sponsored by Tiger Global, had its net loss increase fourfold in 2020–21 (FY21), despite a nearly threefold increase in revenue due to rising labour costs. According to the company’s filings with the Ministry of Corporate Affairs (MCA), Vedantu reported a consolidated net loss of Rs 604.3 crore for FY21, compared to Rs 150.1 crore in 2019–20 (FY20). However, as a result of an increase in demand for remote learning brought on by lockdowns throughout the year, total income for FY21 increased to about Rs 135 crore.
The edtech company recorded a fourfold increase in spending to Rs 744 crore for FY21 from Rs 186 crore a year earlier, while its employee benefit expenses climbed to Rs 408 crore in FY21 from Rs 88 crore in FY20. The company was valued at over $1 billion in September of last year.
Vedantu reports a high increase in revenues for FY21, joining other edtech unicorns like upGrad, Eruditus, and Unacademy in doing so because of the unprecedently strong increase in demand for technologically oriented educational solutions. However, when their marketing costs and employee benefit costs increased, many businesses reported expanding losses for the year.
Vedantu’s co-founder and CEO Vamsi Krishna said that the business increased by nine times from 2021–2022. (FY22). Krishna acknowledged, however, that he anticipates the business to expand more slowly in 2022–2023. (FY23). “You will notice a slight decline in the unheard-of growth that we experienced over the past two years. But that doesn’t mean there won’t be any growth. A 9x growth may turn into a 3X growth,” Krishna added.
With an online tutoring platform for K–12 (kindergarten through class 12) children, Vedantu was launched in 2011 by three IIT graduates: Krishna, Anand Prakash, and Pulkit Jain. The business also offers a platform for preparing for engineering and medical entrance exams like IIT-JEE and NEET. Within the following 18 months, the company is likely to achieve a 25 per cent profit margin and will also attempt to float an IPO (initial public offering).
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