Indian ed-tech startup Physics Wallah bags $2.8 billion valuation amid sector troubles

Indian education technology startup Physics Wallah announced on Friday that it had raised $210 million as it looks to expand its business, in part via acquisitions, amid troubles in the sector.

The funding, led by Hornbill Capital, and involving Lightspeed Venture Partners, GSV and WestBridge, values the company at $2.8 billion, a significant increase from its last valuation of $1.1 billion.

Physics Wallah, founded in 2020, is one of India's many education technology, or ed-tech firms, that offers free and paid-for courses for various competitive examinations in India. The company aims to differentiate itself by offering courses that on average cost less than $50, in order to be accessible to more kids in poorer parts of the country.

"We are not built for 1% of the country or 1% of the world, we are built for the remaining 99%, those who cannot go to these fancy coaching classes … now we enable different kinds of students," Alakh Pandey, CEO of Physics Wallah, told CNBC in an interview.

The company runs on a freemium business model, hosting courses for free on YouTube. For those students who want more features such as homework and tests, there is a paid offering.

The company said its revenue grew 250% year-on-year in the fiscal year ended March 2024 and Pandey said he expects the "highest absolute" EBITDA in the current fiscal year. Earnings before interest, taxes, depreciation, and amortization, or EBITDA, is one measure of profitability used by companies.

Pandey said the company is open to acquisitions provided it gives them access to new content and users.

"Consolidation, we are open to it if it's based on different geography that we cannot serve to, and if it caters to content and community first," Pandey said.

The CEO