upGrad wraps up Unacademy acquisition at $200M

UpGrad has successfully completed its acquisition of Unacademy in a stock-based transaction valued at nearly $200 million, marking a significant deal in the edtech industry. This merger brings together two prominent edtech companies, granting upGrad a foothold in the online test-preparation market and enabling better connectivity with learners through additional channels.

Known for its online upskilling and career advancement courses catering to working professionals, upGrad is preparing to enter a new segment. Unacademy, which specializes in test preparation for competitive exams, had reached a valuation of around $3.4 billion in 2021, but the acquisition dramatically reduced its value, indicating the drastic shift in investor expectations for consumer edtech post-pandemic.

Unacademy's co-founder and CEO, Gaurav Munjal, acknowledged the gap, stating, "Six years ago today, Unacademy became a unicorn. Today, Unacademy has closed its acquisition by UpGrad for just over $200M. We raised at a peak, but sold at a fraction of that. I’m not going to dress these facts up." Despite the lower acquisition price, Munjal highlighted that Unacademy was in a stronger financial position than the purchase price indicated.

He mentioned the company's revenue of approximately Rs 400 crore, profitability in most of its businesses, and a bank balance of Rs 900 crore. Munjal emphasized that the decision to sell was a strategic choice rather than a rescue due to a cash crisis. He revealed that as he understood Ronnie Screwvala's vision for upGrad, it became apparent that merging the businesses could benefit the ecosystem as a whole.