Ed-Tech is on Hold ✋
Thousands of people have either quit or been fired from the Ed-tech sector in 2022.
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Today’s read is about India’s impressive, innovative, and globally recognized Ed-tech Industry. India has a total of 5 ed-tech unicorns (BYJUs, Unacademy, Eduditus, upGrad, and Vedantu) with a valuation of $28.6 billion and god knows how many small ventures and cohorts operating online. Infinite money was poured into this sector in the last two years. In 2020 when global education went online, the Ed-tech’s thrived. Indian Ed-tech raised $2.2 billion (₹17,071 crores) in 2020. In 2021, as the pandemic dragged on that number doubled to $4.7 billion (₹36,477 crores). The hype was real!!
But now
Things are again getting back to normal, most of the people are opting for an offline alternative (Raju wants to take his guitar lessons offline and wants to dump his udemy course) and this is becoming an issue for the companies. The Customer acquisition cost (The money which a company spends to gain a new customer) of the companies is sky-rocketing. And because of cut-throat competition, they are unable to hike the course’s price. Hence the companies are making compromises with their profits.
The Cheeky Approach
You have an interview tomorrow. Oh!! you are hired. There will be a six-week training program where the company will train you to make cold calls and will give to a deadline (harsh) on conversions. You in?
Yes Sir!!
You will be given a ₹15000 stipend and if you worked well, you will be hired with a sexy job offer.
Wow, Sir!!
(Worked Tirelessly, Achieved all his/her deadlines.
After six months……………………………………………………….)
Oh, Man!! You were an awesome employee, Here’s your job letter. You have to report to Lucknow and you will get ₹26000 monthly for the same job.
Whattttt 😡
Take it or leave it. I do have other interviews lined up 😁
F*ck you!!
This is the current scenario of Indian Ed-tech employee admission. The company will hire you, will train you, will bribe you, and then will leave you off-guard. They say this as the ‘Growth Hiring’. It is roughly calculated that around 2,000 employees have either resigned or been terminated at major Indian edtech companies like WhiteHat Jr, Unacademy, and Vedantu.
Vedantu had to lay-off their 7% of its employees, Unacademy closed its 0th to 12th class vertical, and Lido and Udayy shut down its operations.
Growth at any cost mentality
The runway becomes very narrow when the economy takes turns and VCs stop pouring money into your start-up. The techs had accepted the fact that growth and success are the same. Hence they have started playing on the front foot with overly aggressive sales tactics, unwarranted price increases, self-destructive discounting, unnecessary mergers, and acquisitions, or even a poorly considered IPO. The companies were so much into expanding themselves that they forgot to maintain their ledger. But now when the dust is settling, the market is rewarding profitable growth over growth at all costs.
If the companies want to sustain themselves, they will have to maintain a proper ledger and will have to focus on profitable growth.
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Ciao
Nishchal from Team Rubric