Published: 2/16/2021

Good morning, it's Tuesday and Anmol back here with the updates. First up we've got another potential acquisition for BYJUs and Meesho might be India's next unicorn.

  • http://bit.ly/3bfJ5nY: BYJUs set to acquire Toppr for $150M
  • ➡️ Some of the larger edtech players have been on an acquisition spree lately with both Unacademy and BYJUs acquiring (or attempting to acquire) multiple companies over the last year. And yesterday Entrackr reported that BYJUs has been talking to Toppr in a potential acqusition deal which would value the company at $150M

    ➡️ In the Indian EdTech market BYJUs, Unacademy & Vedantu have sort-of emerged as the three main competitors (with BYJUs being significantly larger than the other two) so it makes sense why there has been an increase in M&A activity recently with some of the smaller or mid-sized companies being picked up by these main players.

    ➡️ Toppr raised $47M in July last year at an undisclosed valuation but it might not have been that much off from the potential acquisution value if the deal does go through. That being said some of the older investors on the cap table (Elevation Capital, Helion Venture Partners) probably came out with a reasonably well outcome having backed the company from their seed round in 2014.

    ➡️ BYJUs has come under a lot of scrutiny in recent times over mistreating parents as well as the whole WhiteHat Jr defamation case and likely looks at Toppr as a competitive player in the same space with maybe a better tech platform (it also gets them Toppr Answr- a competitor to Doubnut which it previously tried to acquire).

    ➡️ All in all it seems like a decent outcome for both sides involved. I'm sure the folks behind Toppr wouldn't be incredibly happy that they weren't able to build a billion dollar company themselves but a $150M outcome in the Indian market is nothing to scoff at either, and shows that India now has a couple of potential acquirers of EdTech companies.

    2. http://bit.ly/2NuDstE: Meesho in talks to raise at a $2B valuation

    ➡️ The social commerce company Meesho is allegedly in talks with SoftBank's Vision Fund and others to raise a $250M round that would value the company at $2B. This would be double what the company raised in their Series D round back in 2019 where the likes of Naspers, Sequoia, DST Partners and Elevation Capital also participated.

    ➡️ Should the deal go through, it would make Meesho the second YC company from India to become a unicorn (the first being Razorpay). The pandemic did have an effect on the Indian commerce sector but Meesho has now largely recovered its revenues and the social commerce space is heating up once again.

    ➡️ The company does have 10M resellers and 70M customers and its resellers largely use social platforms like WhatsApp and Instagram to find customers, while Meesho helps with sourcing and logistics and shipping. I do wonder if some of Meesho's resellers are also looking at newer social platforms but it might be a little too soon for that.

    ➡️ The company also posted its FY20 results recently where its revenues grew Rs 307 Cr (up 3.84x from Rs 80 Cr), while also increasing losses three-fold to Rs 315 Cr, and I assume the company will continually improve on this in the next couple of years as it achieves a greater scale.

    Feedback & ❤️ always appreciated BONUS (Tweet of the day): https://twitter.com/nitinmisra/status/1361542680283541505

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