INSOFE, owned by upGrad, Leaves 700 Students Upset After Abruptly Closing AI & ML Course

• ByStartup Story Team     |    April 20, 2023

On April 18, approximately 250 newly hired individuals from the data science training platform, International School of Engineering (INSOFE), owned by upGrad, held a demonstration in Hyderabad following the startup’s purported announcement of shutting down its operations in the city. The protest has affected the hiring of about 700 INSOFE recruits. According to The Times of India, several protestors claimed that the edtech had enticed them with science and AI programs and guaranteed employment upon course completion.

As per the local authorities, the edtech company allegedly obtained private bank loans using the names of its staff. The startup supposedly took out INR 4 Lakh from the bank in the guise of 650 trainees who enrolled for the PG diploma course in data science and INR 10 Lakh in the name of 50 trainees who chose the master’s programme. In response to the allegations that it was ceasing its operations in Hyderabad, Dr Dakshinamurthy Kolluru, the co-founder and CEO of INSOFE, and Sridhar Pappu, the president of UGDX, denied the claims and stated that the trainees had either self-funded or received loans from the platform’s NBFC partners, as per a statement given to Inc42.

In a written statement, Dr Dakshinamurthy Kolluru and Sridhar Pappu, executives at INSOFE, clarified that the company is not closing its offices or operations in Hyderabad, and remains dedicated to investing in its people and projects in the city. However, they noted that the startup had discontinued one of its AI and ML programs due to the global economic downturn. The executives also assured that the company will repay the trainees’ loans within 15 days, and that the trainees will receive NOCs from banks within 45 days. Furthermore, they confirmed that INSOFE has already cleared loans for 200 individuals.

Dr Dakshinamurthy Kolluru and Sridhar Pappu stated that they have established dedicated Zoom links, phone numbers, and email addresses to address the concerns of the affected individuals and offer them the necessary support. They emphasized the company’s commitment to continuing its operations in Hyderabad and its dedication to its learners, employees, and community. The executives added that INSOFE is striving to provide support during these challenging times. Interestingly, none of the protestors chose to file a lawsuit against the company. A police officer at the scene informed the media that the protestors were seeking a settlement with INSOFE to compensate for their losses.

upGrad acquired the data science training institute INSOFE in a share-swap deal worth $33 Mn in May 2022. According to upGrad’s statement at the time, INSOFE was a profitable company, and its revenue was expected to surpass $13 Mn (INR 100 Cr) in 2022. INSOFE, established in 2011 by Sreerama K. Murthy and Dakshinamurthy Kolluru, has a presence in India, the US, the UK, France, and Canada. The platform collaborates with universities in India and the US to provide master’s and doctoral programs in AI, data science, and machine learning. Before its acquisition by upGrad, the edtech startup received $2.6 Mn in a seed round from Kaizenvest in 2017.

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