Byju's last two acquisitions and a deal with Disney reveal its American dream ⁠— one that is anchored in India

• Byju's plans to invest $1 billion in the North American market over the next two years.
• The company believes that that international market would make a third of its revenue in the future.
• The Bengaluru-based company is estimated to earn $300 million from the US market in FY22.

Byju's has had global aspirations since 2019, when it acquired US-based educational game system Osmo for $120 million. The pandemic and the resultant boost for online education platforms in 2020 have led to aggressive expansion by the Indian decacorn (startup valued at over $10 billion) this year.

“India can provide teachers to the world, just like software engineers,” founder Byju Raveendran said in an interview with Business Insider in October 2020.


Byju’s has already laid out an elaborate plan for the estimated $43 billion+ edtech market in the US dominated by Age of Learning (valued at $3 billion) and Kajabi (valued at $2 billion) in the kindergarten to class 12 (K12) segment Byju’s is looking at.

Two acquisitions in the last one month ⁠— Epic and Great Learning ⁠— have cost Byju's over $1.1 billion, and it plans to invest over a billion dollars in the North American market over the next two years. Besides that, the Indian startup has launched its core Disney-based learning app in the US and launched Byju's Global School for vocational learning. Industry watchers believe there may be more deals and acquisitions along the way.

Investment bank Dexter Capital’s founder Devendra Agrawal, in an interaction with Business Insider, said that there is a lot of headroom for edtech to grow globally and there are few with the kind of muscle that Byju's ⁠— with a valuation of $16.5 billion ⁠— has. More importantly, Byju's can make more revenue ($376 million in FY20) in countries like the US, UK and Australia, where people can afford to pay more.

Anita Kishore, the head of strategy at Byju's, told Business Insider that international markets would make a third of the company’s revenue in the next three to four years. The USA would be dominating the international market for Byju's.

Anita Kishore, the strategy officer at @BYJUS's talks about why they chose US as a key market.

Read more here: https://t.co/21ymEHRgQk pic.twitter.com/GzwHXpgzhc

— Business Insider India🇮🇳 (@BiIndia) July 21, 2021

With steady business growth prediction in India, why do Byju's want to look at the American market?

The company started its expansion plans in 2019 by acquiring Osmo, which produces augmented reality games for mobile devices.



The company made its second acquisition in the US last week. It acquired digital reading platform Epic for half a billion dollars. The buyout provided Byju's with access to the company’s user base of 50 million students and 20 million teachers in one hit.

Byju's also leveraged its $300 million acquisition of the coding-for-kids startup WhiteHat Jr by launching the Future School brand that will focus on providing extra-curricular courses in international markets.
The company has already launched its services in the US, Canada, Australia, New Zealand and other English speaking markets last month. It has also been piloting in non-English speaking countries like Brazil and Mexico, and will plan a full-roll out soon.


The 10-year-old startup expects to earn $300 million in the US in the financial year ending March 2022, all thanks to these three products.


Notably, the company has made four acquisitions, amounting to $2 billion, in the last six months. Two of which — Great Learning and Epic — directly related to the company's international expansion plans.

Kishore emphasised that Byju's does not have any target number for acquisition or investments to expand its presence in the US. “It is more where we see a strategic fit and an alignment of vision with the founders. That’s where we go ahead and do that [acquisition].”

“ India will continue to be Byju's biggest market in terms of revenue for the next two years. However, they would want this ratio to change going forward. How soon it could change is hard to comment. The outside market, like the US, the growth could be higher. Two-three years later, the percentage revenue they get from the US market could be sizeable. It would not be more than 50% or more than Indian market. In the long term, it may happen that Byju's is getting more revenue from outside India.” -- Devendra Agrawal, founder, Dexter Capital

A dream so big, it may need bigger deals

Acquisitions are usually done for three reasons. First, to enter new geographies. Second, to incorporate new services or products into business offerings. Third, to eliminate a disruptor that could be a potential threat to the company in the long run.

“Because of all three reasons, Byju's will continue to acquire new players…,” Agrawal told Business Insider.

The organic way of doing so, by building a team and hiring people, may actually take a couple of years. The inorganic way, by acquiring companies, can help speed up the process of scaling up.

Madhur Singhal, managing partner and chief executive officer (CEO) at consulting firm Praxis Global, explained that the company’s expansion largely depends on how well the company develops an empirically grounded model of technology and capability that taps the market opportunity with cross-selling into customers of acquisitions they are making. “If this strategy comes right, it could result in bigger and faster outcomes,” he added.

While the global market will make up a third of Byju's revenue, India will continue to be the biggest market for the edtech company due to the massive growth of its core product in two to three years, Kishore emphasised.

The recent acquisition of the test preparation chain Aakash Educational Services, which has over 200 coaching centres across India, is going to accelerate the company’s growth in India as well. Byju's had acquired Aakash for $1 billion earlier this year and it was the biggest edtech deal in the world.

Even though Aakash may not contribute much to Byju's international plans, the acquisition will give the company a sizable revenue as well as profit. “If somebody has to distribute Byju's revenue — organic revenue versus revenue of acquired companies — Aakash would give them largest leverage purely from the EBITDA [earnings with interest, taxes, depreciation, and amortisation] and revenue perspective,” Dexter Capital’s Agarwal added.

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