Byju’s is currently imploding in public through ED raids, valuation markdowns, and delayed salaries, but smaller ed-tech startups aren’t having the best time either.
Ed-tech startup Doubtnut has been acquired by Allen Career Institute for $10 million, Techcrunch reports. Doubtnut, however, had raised $52 million from investors over the last 7 years, which means that investors would’ve taken a serious haircut on their investment.
“Timely and effective resolution of doubts is a core consumer need in education,” said Allen CEO Nitin Kukreja. “Doubtnut’s platform will allow us to greatly enhance the learning experience for our students. We are also excited by the prospects of offering ALLEN’s high quality academic products to a wider audience,” he added.
“Doubtnut’s mission is to bring education to every student across India using technology and high-quality content,” said Doubtnut co-founder Aditya Shankar. “We have worked towards this vision over the last six years, gaining immense consumer love during this journey,” he added.
Doubtnut had been founded in 2016 by IIT Delhi alums Aditya Shankar and Tanushree Nagori. The company aimed to help students solve their doubts, or questions, through an online platform. Doubtnut used image processing to answer questions — students could simply upload a picture of their problem, and Doubtnut would extract text from the image, and try to match it with a database of pre-answered questions, and showed a video solution. If the automated system couldn’t adequately answer the ‘doubt’, it would also allow the students to connect with a teacher who could answer their queries. Doubtnut now reaches 32 million students across its digital apps, websites and YouTube.
Doubtnut had had some big backers — it had raised $52 million (Rs. 416 crore) over the years from investors including Sequoia India, Omidyar Network, and James Murdoch’s Lupa Systems. In January 2022, Doubtnut was valued at $152 million (Rs. 1,200 crore). Interestingly, Byju’s had tried to acquire Doubtnut for around $150 million in 2020, but the deal didn’t materialize.
Cut to three years later, and Byju’s has seen its valuation plummet from $22 billion to less than $3 billion, and Doubtnut has been acquired for $10 million, a fraction of its peak valuation of $150 million. In the meanwhile, traditional educational companies have gone from strength to strength — Allen, which was founded 35 years ago recently raised funds at a valuation of over $1 billion, and has ended up acquiring a high-flying young startup that was looking to disrupt the education industry. Which just goes to show that while technology might be changing how education is imparted, the winners might still end up being traditional education firms instead the ed-tech startups which adopted and popularized these techniques in the first place.