In a significant turn of events within India’s edtech landscape, Physics Wallah has successfully secured $210 million in Series B funding, marking a notable achievement in a sector grappling with financial turbulence. This funding round was spearheaded by Hornbill Capital, a partnership between China’s Orchid Asia and India’s Hornbill. Notably, Lightspeed Venture Partners played a substantial role, alongside existing investors like WestBridge and GSV. This latest capital injection elevates Physics Wallah’s valuation to an impressive $2.8 billion, reflecting a remarkable growth trajectory from its previous valuation of $1.1 billion in June 2022.
The journey of Physics Wallah, which began in 2016 as a humble YouTube channel, has been nothing short of extraordinary. Co-founder Alakh Pandey launched the channel to provide free educational resources, aimed particularly at students unable to afford premium coaching classes. By 2020, Physics Wallah had transformed into the largest Indian education community on YouTube, prompting the founders to formalize their efforts into a company that now extends its reach to 46 million students across five vernacular languages.
Prateek Maheshwari, co-founder of Physics Wallah, shared insights into the motivation behind their mission. His personal experience of struggling to access quality education resonates with many in India, a nation with one of the largest education markets globally. With approximately 250 million students in school and 4 million taking entrance exams for engineering and medical colleges annually, Physics Wallah caters to a diverse audience, from third-grade students to those preparing for competitive exams.
Physics Wallah’s innovative approach includes offering live classes that can attract tens of thousands of students simultaneously. In addition to its digital efforts, the startup operates around 180 physical learning centers and employs teaching assistants alongside artificial intelligence to enhance student support. Their AI Guru app, trained on their own data, assists students in tackling academic challenges, showcasing the company’s commitment to integrating technology into education.
A pivotal factor behind Physics Wallah’s success is its affordability. With course prices starting as low as $50 for an entire year, it has amassed over 5.5 million paying subscribers. Maheshwari proudly noted that the platform ranks number one in terms of revenue and student base for key exams such as JEE, NEET, GATE, UPSC, and CAT.
Financially, the company has demonstrated robust growth, reporting revenues of $96.2 million for the fiscal year ending March 2023—a staggering 2.5 times increase from the previous year. Looking ahead, Physics Wallah anticipates its fiscal year ending March 2025 to be its most profitable yet, a sentiment echoed by industry experts. Dev Khare, a partner at Lightspeed, highlighted that the trend of lowering price points has significantly broadened access to quality education, allowing startups like Physics Wallah to thrive even as competition intensifies.
Despite the recent challenges faced by the broader edtech sector, including significant job cuts at major players like Unacademy and the financial turmoil surrounding Byju’s, Maheshwari remains optimistic. He asserts that the core market opportunity remains unchanged, with students benefiting from a hybrid learning environment that combines the best of both online and offline education.
Physics Wallah’s approach exemplifies a successful model characterized by three key components: Content, Community, and Commerce. As Manoj Thakur, founder of Hornbill Capital, noted, the company represents a “rare combination of vision, execution, and impact,” particularly in its use of AI to enhance both educational outcomes and student well-being.
As Physics Wallah continues to expand, it is eyeing inorganic growth opportunities, having already acquired around ten firms in the past three years. While plans for an IPO are on the horizon, Maheshwari emphasized that immediate action is not expected.
This funding round signifies not only a triumph for Physics Wallah but also a beacon of hope for the Indian edtech sector, showcasing how innovative approaches and a commitment to accessibility can lead to remarkable success, even amidst broader industry challenges. As the landscape evolves, Physics Wallah stands poised to redefine educational access for millions of students across India, continuing its mission to democratize learning in a country where education is both a privilege and a necessity.