Eruditus turns unicorn after $650M funding | Economic Times

Bengaluru: Online executive education startup Eruditus has raised $650 million funding in a new round led by venture capital firm Accel US and Japan’s SoftBank Vision Fund II. Post the funding, which is a mix of primary capital infusion and secondary stake sale by existing shareholders, Eruditus will be valued at $3.2 billion, its founder and CEO Ashwin Damera told ET in an exclusive chat. The Canada Pension Plan Investment Board has also invested in the firm through a mix of primary and secondary transactions in the latest financing, sources in the know said. While the company will receive $430 million in primary capital, $220 million of the secondary sale proceeds will go to existing backers like Bertelsmann, which is part selling its shares. Sources told ET that Damera and the Eruditus management may be liquidating as much as $100 million in the current round, making it among the largest cashouts for a founder. Damera said he still holds 40% stake in the 11-year-old firm post this funding. He declined to comment on partly liquidating his ownership as part of the latest transaction.The financing round by Mumbai-based edtech firm is one of the largest in the space and also marks the second bet by SoftBank in this sector after it backed Unacademy last year. For Eruditus, this will be a massive jump in valuation since it was last valued at around $800 million in August last year. For Accel, which is investing in the firm through its US fund, this is the single-largest cheque in an edtech startup, Damera added. “We were at an annualised $350 million gross bookings run rate and should close the financial year ending in June at $500 million. We use a lot of capex for course creation. So, capital will go there as well as in making acquisitions,” Damera told ET. The company clocks about 20% of its overall bookings from India while 35% of it comes from the US. Rest of the bookings come from Europe, Latin America and other geographies.Eruditus will look at the acquisitions route across India and abroad. After its last year's funding round, the company had acquired iDTech for $200 million to expand its offering in the K12 space. Damera said the fresh funds will be used to develop new courses with its university partners, and introduce products and industry verticals. It will also expand its business serving governments and enterprises, and enter new geographical markets, he added.