Unacademy looking out for merger or buyer: Report

The churn in the Indian edtech industry continues with Unacademy on the lookout for a merger with another education company or for an outright acquisition or a bailout, reported The Morning Context quoting four persons aware of the latest developments in the firm.

This comes close on the heels of the widely-reported crash of another high-flying edtech startup Byju’s in recent months.

The Bengaluru-based Unacademy, last valued at $3.4 billion, is said to have reached out to several companies in the education sector including education services company K12 Techno, coaching institute Allen, and edtech company Physics Wallah. In fact, Entrackr had reported last month that Unacademy was talking to K12 Techno for a possible merger.

Layoffs

There have been signs of turbulence in the Gaurav Munjal-headed unicorn for some time. Unacademy witnessed the exit of its cofounder and CTO Hemesh Singh a few weeks ago. The media has reported layoffs of 250 employees very recently, including 150 salespersons and 100 from other functions in the company.

Unacademy confirmed the “restructuring exercise” in a statement, “As part of our ongoing efforts to streamline operations and enhance business efficiency, we have recently undergone a restructuring exercise. This was necessary keeping in mind the company’s goals and vision for the year, as we focus all our efforts on sustainable growth and profitability. Consequently, some roles have been impacted.”

This latest round of layoffs follows two other rounds, when it laid off 380 employees (about 12 per cent of its workforce at the time) in March 2023 and almost 1,000 of its staff (full-time and contract employees) in April 2022.

Crisis in edtech sector

The Indian edtech industry had reached stratospheric heights during the Covid pandemic when students were home-bound and the future was uncertain. Valuations of the top firms continued to rise irrespective of the revenue model and profitability. However, after the pandemic ended and students returned to school and college, the edtech sector has been going through a crisis since 2022.