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Exclusive: PhysicsWallah set to raise $150 Mn at $2.8 Bn valuation

EntrackrEntrackr · 11m ago
Exclusive: PhysicsWallah set to raise $150 Mn at $2.8 Bn valuation
Medial

While the edtech space has been going through a long spell of the so-called ‘funding winter’, PhysicsWallah (PW) appears close to raising a new large round. Fresh funding will be led by new investors whereas existing investors including Westbridge and GSV Ventures will also participate, three sources aware of the discussion told Entrackr. “PhysicsWallah is set to raise $150 million from new and existing backers,” said one of the sources requesting anonymity. “The terms of the deal have been sealed and the transaction is likely to be public soon.” This will be the second financing round for the Alakh Pandey-led firm in the past two years. PhysicWallah raised $100 million in a Series A round led by Westbridge and GSV Ventures in June 2022. “PhysicsWallah will be valued at around $2.8 billion in the new round,” said another source who also wished not to be named. This will be over a 2.5X jump in the company’s valuation as PhysicsWallah was valued at $1.1 billion in its Series A funding. Queries sent to PhysicsWallah and Westbridge didn’t elicit any immediate response. We will carry their comments in case they respond. According to the startup data intelligence platform TheKredible, WestBridge held a 2.4% stake in PhysicWallah while GSV owned 1.44% as of the Series A round. Its co-founders Alakh Pandey and Prayeek Maheshwari cumulatively command 86.54% of the company. PhysicsWallah started with online coaching for IIT/JEE but has now become a full-fledged education firm, offering offline coaching, schools, colleges, and upskilling programmes. According to sources, about 30% of its revenue comes from JEE and NEET coaching whereas offline coaching (via Vidyapeeth and Pathshala) contributes 35% of the collection. While the company is yet to disclose FY24 numbers, PhysicsWallah’s revenue surged 3.3X to Rs 779 crore in FY23. At the same time, the firm’s profit declined more than 90% to Rs 8.87 crore in FY23. In November last year, the company laid off 120-150 employees as a cost-cutting measure. Entrckr was the first to report the development. As per data compiled by TheKredible, edtech startups raised only $138 million across 21 deals during the first half of 2024. This is a sharp fall from $456 million in 2023, $2.3 billion in 2022, and $5.8 billion in 2021. The funding news is the strongest testament yet to the investor conviction in PhysicsWallah’s long-term strengths. This incredible loyalty and credibility with the student community other edtechs have simply not been able to earn for love or money. The valuation also indicates a relatively long time investors are willing to wait it out for the firm to deliver on its potential and declared ambitions. A funding round in this environment will not just buy PhysicsWallah time, but also provide the gunpowder to scale up at a much lower cost thanks to the emasculated state of the competition.

Related News

Exclusive: CRED set to raise $75 Mn at $3.5 Bn valuation led by GIC

EntrackrEntrackr · 1m ago
Exclusive: CRED set to raise $75 Mn at $3.5 Bn valuation led by GIC
Medial

CRED set to raise $75 Mn at $3.5 Bn valuation led by GIC After a three-year pause, fintech unicorn CRED is back in the fundraising game with a $75 million investment from its existing investors, three sources familiar with the matter told Entrackr. “Existing investor GIC, through Lathe Investment, is leading the round, with participation from RTP Global and Sofina,” said one of the sources requesting anonymity. The source added that CRED founder Kunal Shah will invest around $20 million in the internal round. “The deal terms have been finalized, and the investment is expected to be announced shortly.” CRED raised $140 million in June 2022 in a mix of primary and secondary rounds led by GIC at a valuation of $6.4 billion. Following the deal, CRED's valuation is set to drop to $3.5 billion, a 45% cut from its previous valuation, according to sources cited above. CRED has raised a total of $1 billion in funding across nine rounds. According to startup data intelligence platform TheKredible, PeakXV is the largest external stakeholder with 10.4% followed by Ribbit Capital, Tiger Global, and others. Founder and CEO Shah commands a direct 22.8% stake, along with his QED Innovation Labs. The fundraise comes as CRED works to narrow its losses. A source indicated that the company turned profitable in the first two months of FY26 and is now targeting full-year profitability for the ongoing fiscal. CRED declined to comment on the story, while queries sent to GIC, Sofina and RTP Global did not elicit a response. CRED provides services such as credit card management, credit score tracking, hidden charge detection, bill payment reminders, and cashback. It also offers access to shopping, travel packages, and tools for managing vehicle insurance, FASTag, and other related features. It also used to offer P2P lending but recently discontinued it after RBI’s guidelines. During FY24, CRED reported a 22% increase in its net loss to Rs 1,644 crore. This figure includes expenses related to the employee stock ownership plan (ESOP) and taxes. Meanwhile, the company’s revenue surged 66% year-on-year to Rs 2,473 crore during the same period.

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