iProf Learning Solutions India Pvt. Ltd, a Noida-based e-learning company and the maker of probably India's first personal education tablet and an operator of a chain of Wi-Fi-enabled e-learning centers across the nation, has raised Rs. 22 crore in Series A funding from Norwest Venture Partners (NVP) and IDG Ventures India (IDGVI). The stake sold is not disclosed. The capital will be used to open more iProf's e-learning centers (iProf iStudy Zones) in metros and tier 2/3 cities in India and abroad, and to launch several new iProf products in partnership with professors, subject matter experts and organisations, the company said. As part of this investment, Mohan Kumar, Executive Director, NVP India, and Sudhir Sethi, Founder, Chairman & Managing Director, IDGVI, will join the board of the company.
iProf claims to offer India's first personal education tablet and delivers study material in multiple formats such as audio-video lectures, animations, structured tests, solutions and performance analysis. Students will be able to download various education content from retail hotspots called iStudy Zones. Presently nearly 20 iStudy Zones are operational and will reach 100 by the end of 2011, a statement said.
The investment is essentially a bet on the growing test preparation market in India and also betting on iProf's plans to reach out to Tier II and Tier III cities.
Sanjay Purohit, Founder and CEO, iProf, said, "India's test preparation market is expected to reach $1 billion in three years. However, primary growth restraints to date have been the lack of strong teachers, the limited reach of classroom programmes into tier two and tier three cities and the high price of classroom coaching for IIT/MBA courses. To meet the needs of this growing market in India, iProf has created an innovative e-learning marketplace by which a large number of courses can be provided in extremely engaging and interactive formats at an affordable price to millions of students worldwide. This is available to even those students who don't have computer or internet access."
The Indian tablet maker has recently tied up with IGNOU, the World's largest Open University with an enrollment of more than 3.2 million students. IGNOU has approximately 1400 study zones across India and has partnered with iProf to conduct diploma programs for 75 of its courses on the iProf platform.
Sudhir Sethi, Founder CMD, IDG Ventures India commented, "Students, particularly in tier two and tier three cities in India, are looking at alternatives to gain convenient access to quality test preparation materials and Distance Learning courses. At the same time, traditional content and classroom instruction providers are seeking strong technology partners with innovative content distribution platforms. iProf addresses the education infrastructure challenges that prevent quality education from reaching the 25 million student population in India."
Mohan Kumar, Executive Director, NVP India, said, "The Indian education system is one of the largest contributors to the economic growth of the nation---an estimated USD 50 billion market, with a potential 16% five-year CAGR. iProf is serving a key need in India because the company brings high quality e-learning education to millions of students who are currently deprived and in urgent need of this form of learning."
There have been many PE investments in the education space in the recent past. Some investments in the space include: Sequoia Capital India and Song Investment Advisors India Pvt. Ltd. invested $15 million in K-12 Education Centre, Mayfield Fund invested $8 million in Centum Learning Ltd.
According to a recent E&Y report on education, the Indian higher education system has established itself as one of the largest in the world, in terms of number of institutions and student enrolment. Higher education spends in India are currently estimated at Rs 46,200 crore and are projected to grow to nearly Rs 150,000 crore in the next 10 years.
Growing global integration and changing macro-economic trends are influencing the composition and preferences of students, leading to new demand-side realities. These include increasing spends on education, new categories of students, willingness to pay for academic quality, increasing demand for global education and demand for employability-linked education.