Unacademy Takes Strategic Steps Amid Changing Landscape in Edtech Industry
Indian edtech giant Unacademy has recently announced a restructuring that involves laying off about 250 employees, marking the latest in a series of strategic moves following the reopening of schools across the country post the pandemic era. The Bengaluru-headquartered startup, valued at $3.4 billion in its last funding round in 2021, is taking a targeted approach by cutting 100 jobs in core roles such as marketing, business, and product, along with about 150 in sales.
This new round of layoffs brings the total number of job cuts at Unacademy to approximately 2,000 since the second half of 2022. While an Unacademy spokesperson confirmed the layoffs, the exact impact on individuals remains undisclosed. However, the restructuring has been deemed necessary to align the startup with its objective of achieving profitability, as emphasized by its backers including General Atlantic, SoftBank, and Peak XV.
Unacademy’s strategic decisions come at a time when the company is reportedly exploring a potential merger with K12 Techno, the parent company of Orchid International, a prominent school chain. This move reflects the shifting landscape in the edtech industry, where companies are adapting to declining enrollments as schools transition back to traditional in-person classes.
Internationally, the edtech sector witnessed a surge during the pandemic; however, challenges have surfaced post-lockdowns. In India, the industry faces further uncertainty following the recent decline of Byju’s, the country’s erstwhile leading startup. With Prosus, the major external investor of Byju’s, reporting a complete write-down of its stake in the company, concerns over governance and viability have emerged.
Amidst these industry dynamics, Unacademy’s strategic approach involves a mix of cost-cutting measures and expansion initiatives, including venturing into offline centers and experiences in addition to its online courses for competitive exams. Gaurav Munjal, the co-founder and CEO of Unacademy, highlighted the importance of an “offline play” for Indian businesses in a recent thread, suggesting a balanced approach for sustainable growth.
Munjal also shared insights on the market conditions and startup valuations in 2021, cautioning against inflated figures. He attributed Byju’s setbacks to a lack of receptiveness to feedback by its founder, urging entrepreneurs to remain open to critical input for continued success.