Executive education startup Eruditus has raised $150 million in new funding at a lump sum valuation of $3.2 billion post-money, led by TPG Rise, an impact investing fund from the US investment firm in private equity.

Existing investors SoftBank Vision Fund 2, Leeds Illuminate, Accel, CPP Investments and Chan Zuckerberg Initiative participated in the round.

TPG Rise invested $100 million in Eruditus while SoftBank invested another $20 million.

Eruditus has become India’s largest edtech company by revenue with Rs 3,800 crore in FY24. It is on track to generate over Rs 5,000 crore in revenue this fiscal , founder Ashwin Damera told ET.

He said the company will now begin the transfer process to shift its domicile from Singapore to India.

ET first reported in January about Eruditus’ plans to move here, joining a league of Indian startups with holding companies in the United States and Singapore.

This is the longest it has taken the company to close a funding round as global investors still have questions about India’s edtech sector amid Byju’s troubles, Damera said. “FY25 – July to June – will be close to Rs 5,000 crore in revenue and we are expected to do around Rs 300 crore in Ebitda,” he said. “We just became profitable in FY24 at the Ebitda level. For a company of our size, I think we should keep some cash on hand, cash for mergers and acquisitions.

Speaking about key metrics such as revenue, Ebitda and growth, Damera said: “We are better today… We are talking about a company that will be listed on the stock exchange in maybe two years, every once the schedule is set, but when we do, it will be at a much higher multiple.

After PhysicsWallah raised $210 million last month, this is the second major edtech deal, although Eruditus’ smaller rival Upgrad closes a $50-$60 million funding round. dollars from existing investors, as ET reported on October 16.

Several edtech companies have closed shop and returned capital to investors while Byju’s continues to struggle.

“This has been a longer fundraiser than expected,” Damera said. “Also during this process we learned a few things. One is that some of the guys that we thought were very enthusiastic have decided either not to invest in education or not to invest in India for a while,” he said, indicating the broader concerns of investors around the sector.

“The second thing, also from our perspective, is that a lot of them are global investors. So, they also look at the comparables in the US… We had to spend a lot of time telling them that corporate governance here is very different from what you have experienced in other Indian companies,” a- he added.

Use of financing, expansion

Eruditus plans to use most of the latest funding for expansion. “Today we play a lot in what we call executive education,” Damera said. “What we plan to do as we go… is to go to a lower level, which will be post-graduate, like at the master’s level, and then move to a lower level, which will be undergraduate,” he said. expansion projects.

The company also plans to invest and expand activities such as study abroad, introduce more courses and expand the number of university partnerships. It has around 80 university partnerships and will increase this number to 150 in the coming years.

“We will grow at around 25 to 30 percent per year. Even with a conservative growth rate of 25%, we will achieve a turnover of Rs 15,000 crore,” Damera said, adding that this scale would be essential for its IPO plans given that it would also play a key role in the multiples it can obtain in terms of turnover and Ebitda. . “Do you take 50x, which is the current market situation, or do you take 40 or 35, which is perhaps more reasonable? » he said.

Eruditus could also use some of the latest funding to pay down some of its debt, although payment cycles extend over the next two years. “We don’t need to repay our debt. Our debt is at the end of next year. So there is no need to pay the debt starting today… A certain amount of debt for a company of our size is not bad,” Damera said.

According to Damera, nominated this year in the Comeback Kid category at the ET Startup Awards, the company’s core business is profitable and growing very quickly.