8 highlights
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Byju Raveendran met Unacademy’s founder and CEO Gaurav Munjal several times last year. During these meetings, according to two people privy to the details, Raveendran made an offer to Munjal for a potential collaboration/buyout. But after some back and forth, the two parties walked away from a potential deal because they could not agree on valuations. Their egos played an equally important part. Eventually, both went their separate ways.
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“From where I see it, K-12 [the industry term for education of children from kindergarten to grade 12] is done,” says a second expert, also requesting anonymity. “Nobody is going to invest in any K-12 player because no one is going to be able to compete with Byju’s might.
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The Byju’s-Unacademy rivalry transcends the world of education technology. A key area where the two companies have clashed of late is cricket. Key, because only two things sell in India—Bollywood and cricket. Every businessman worth his salt knows this. This is why you see so many actors and cricketers selling everything from hair oil to edtech products on television, in newspaper ads and on billboards.
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So when Chinese mobile phone manufacturer OPPO wanted to bail it out of the agreement to sponsor the Indian cricket team in 2019, Byju’s grabbed the opportunity with both hands. OPPO had agreed to pay the Board of Control for Cricket in India (BCCI) nearly Rs 1,100 crore, a record sum and double the base price of Rs 538 crore, in 2017, for a five-year sponsorship contract.
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Byju’s acquired the rights under the terms of the original contract plus an additional 5% of the balance amount as a re-assignment fee.
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The significance of the deal was not lost on Munjal. So when the next opportunity came in 2020, as Chinese mobile manufacturer Vivo suspended ties with the Indian Premier League amid rising anti-China sentiment in the country, Unacademy made a bid to become IPL’s title sponsor.
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The title sponsorship rights went to fantasy gaming platform Dream11 for Rs 222 crore, but BCCI brought in Unacademy as IPL’s official partner for three seasons starting 2020 in a deal worth Rs 120-130 crore. Byju’s wasn’t pleased. Then Unacademy went a step further and signed up cricket legend Sachin Tendulkar as an investor and brand ambassador.
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The endgame for Byju’s, on the contrary, is obvious. It is gearing up for an IPO. And, it has the revenue. Individually, AESL is profitable and Byju’s is closing in on profitability. For the year ended 31 March 2019, the latest period for which data is available, Byju’s recorded a 3x jump in revenue to Rs 1,306 crore. It was also able to trim losses significantly to Rs 8.8 crore from Rs 37 crore in the year before.