Unacademy turns unicorn with $150 mn funding round led by SoftBank

Sorting Hat Technologies, which operates edtech platform Unacademy, has raised $150 million in a growth funding round led by the SoftBank Group, valuing the company at $1.45 billion post money.

This is an almost three-fold jump from its previous round of funding in February, which was led by General Atlantic and Facebook. 

Returning investors General Atlantic, Sequoia Capital India, Nexus Venture Partners, Facebook and Blume Ventures also participated in the round, Gaurav Munjal, CEO of Unacademy, said in a statement on Twitter. 

Unacademy Group has raised $150M in a round led by Softbank valuing us at $1.45B post the funding. Great to have them onboard as a partner in our journey.

Our existing investors General Atlantic, Sequoia India, Nexus, Facebook and Blume also participated in the round.

— Gaurav Munjal (@gauravmunjal) September 2, 2020

The test preparation platform is the second edtech unicorn in India funded by SoftBank. The other is Byju’s, which is valued at over $10 billion and has raised two successive growth rounds in the past two months from DST Global and Bond, the growth equity firm founded by Mary Meeker. A unicorn refers to a privately held startup valued at $1 billion or more.

Founded in 2015 by Munjal, Roman Saini and Hemesh Singh, Unacademy started with a focus on preparation for UPSC examination and has gone on to add other verticals. 

Unacademy has been on an acquisition spree this year, strengthening its offering of over 35 exam preparation services on the platform. In July, the company acquired a majority stake in K-12 learning platform Mastree for $5 million. In the same month, it acquired post-graduate medical entrance exam test prep platform PrepLadder for $50 million. 

In July, CEO Gaurav Munjal indicated that the company was looking to follow the acquisition-led growth model in another tweet, asking for reference of startups in the continuing education space for career building.

If there are entrepreneurs working on such ideas please DM me.

— Gaurav Munjal (@gauravmunjal) July 22, 2020

Other acquisitions by Unacademy in 2020 include engineering test prep platform Kreatryx and non-profit educational arm of Directi Group CodeChef. 

The edtech space has seen multiple growth rounds in companies as diverse as K-12 and online tutoring to test prep and executive learning. Earlier this week, executive learning platform Eruditus Group announced raising $113 million in a funding round led by Leeds Illuminate and Prosus Ventures. Online tutoring platforms for K-12, Vedantu and Toppr, raised $100 million and $46.7 million respectively, in July. 

Unacademy is also SoftBank’s first bet in the edtech space in India. Softbank Vision Fund has previously backed Chinese online tutoring company focused on K-12, Zuoyebang, which was spun out of technology and internet giant Baidu.

SoftBank Vision Fund has also slowed down on new investments globally in the aftermath of the WeWork IPO debacle. It is in the process of raising $108 billion for its Vision Fund II.