Gaurav Munjal, cofounder and CEO of Unacademy, announced during a townhall that 70% of the company’s offline centers are projected to achieve profitability by 2025.

He shared the update with stakeholders via X (formerly Twitter).

Munjal emphasized that Unacademy is focused on making its core business profitable, and is not relying on acquisition-driven growth strategies like some competitors.

He highlighted that subsidiaries like Graphy and PrepLadder are generating cash monthly.

The company has also reduced its cash burn significantly. From nearly 1,000 crore rupee (US$117.44 million) three years ago, it is projected to fall by almost 50% year-on-year to under 200 crore rupee (US$23.49 million) by 2025.

🔗 Source: Inc42

🧠 Food for thought

1️⃣ Indian edtech’s evolution from growth-at-all-costs to sustainable profitability

Unacademy’s dramatic shift from high cash burn to profitability focus reflects a fundamental transformation across India’s edtech landscape following the pandemic boom.

The company’s burn rate reduction from approximately ₹1,000 crore three years ago to a projected ₹200 crore in 2025 mirrors the sector-wide reality check, as edtech funding in India plummeted after reaching a peak of $4.9 billion in FY22 1.

This course correction follows a period when excessive venture funding led to overvaluation and unsustainable business models, with many companies prioritizing aggressive marketing over educational outcomes 2.

The shift is particularly evident in Unacademy’s reported valuation decline from $3.4 billion to a potential acquisition price of $800 million by Allen Career Institute, indicating investors’ renewed emphasis on financial fundamentals over growth metrics 3.

Companies like Physics Wallah and UpGrad have demonstrated that sustainable growth is possible by focusing on specialized offerings and maintaining capital efficiency, providing a blueprint for the sector’s future 4.

2️⃣ Acquisition strategies prove challenging for Indian edtech sustainability

Munjal’s warning about multiple acquisitions reflects hard-learned lessons from the sector’s recent history, including Unacademy’s own experiences.

The edtech sector has seen numerous acquisition failures, with prominent examples including BYJU’S purchase of WhiteHat Jr, which struggled due to misalignment with user needs and unsustainable operational models 5.

Recent Unacademy developments