BYJU’S

BYJU`S –THE THE

LEARNING APP
LEARNING APP
Sujith, Cyril, Mishal, Ajay

GROUP B – AJAY , MISHAL, CYRIL , SUJITH

Timeline
INDUSTRY DYNAMICS OF EDTECH
INDUSTRY
• There are over 4,530 active EdTech start-ups in
India today, out of which 435 were founded in
the last 24-months alone.. By 2018, the industry
had amassed an impressive $700 Million in
funding. According to KPMG’s Online
Education In India , 2021 report, by 2021, the
industry could be worth $1.96 Billion. 

• From an estimated size of $700 million today,

the EdTech market (that includes higher
education, professional skilling courses and of
course the primary education) is headed for 8x
to 10x growth in next 60 months (5-years).
Why? Because of the massive adoption of
online education post the outbreak of pandemic
that brought with itself lockdown of most
institutions including the schools, colleges and
the professional institutes.
 INDUSTRY DYNAMICS OF EDTECH
INDUSTRY
• The positive influence of NEP 2020 when implemented as
recommended will further see a massive public spending
that will
  further fuel the education market.
BYJU`S BUSINESS MODEL &
PRICING
• Byju`s is following a Freemium Business Model.

• Freemium allows users to access the company essentials

for free at given days.

• After certain amount of days it allows users to choose

premium plans to further continue services. A
subscription fees is levied. Byju’s revenue structure is
primarily based on Subscription fees
Byju’s has three streams of revenue.
• Subscription Model (Beyond the Free trial)
• Tablet Model (Same courses installed in a tablet where the
student has to buy the tablet and they can learn offline
without using the internet)
• Offline Courses (Byju’s Offers offline courses at some
locations like Delhi, Noida, etc.)
So, the business model is simple. It’s like Netflix. The ‘Free
Trial’ Business Model.
CURRENT PRICING
Business Model Canvas
 Economies of scale
■ Costs incurred by Byju’s • Digital space runs on economies
– Web development of scale
– Media development
– Maintenance
• Focus on rapid user acquisition
– Data center • 80 million users with 5.5 million
– Business development and operations paid users, >80% retention
– Marketing and sales • International expansion
– General and administrative
• Same teachers for all classes
• Avg revenue of 1.5m per
employee as of 2019
Economies of scope

■ Products in regional languages - redubbing

■ International expansion with country specific content
■ Effective use of the backend and developers
■ Trying to use existing infrastructure effectively to create new products in existing and
new markets
■ Other products – gamification, interactive videos etc.
 Transaction costs
■ Asset specificity and hold up
– Cloud
– Saas, Paas services for IT development
– Intangible assets
■ Searching and Information costs
– Penetration into 2,3,4th tier towns
– About 5k – 10k sales force (by
estimates)
– ~500cr advertising and promo budget in
2019
– Effects PAT despite gross margin of
about 60 – 70%
■ Vertical integration
– All content in house for quality
– All teachers trained in house
– Limited till backend dev
■ Enforcing contracts
– Anyone can drop of from the app
anytime
– Frequency of contact is high
– Long time subscriptions
– FOMO
BYJU’s Acquisition Spree
Diversification

■ Focus on inorganic related diversification from 2017

■ Educational games - Osmo
■ One-to-one live coding classes – Whitehat Jr
■ Test prep firm – Aakash
■ Doubt clearing platforms – Scholr
■ Laboratory simulations – labInApp
■ Diversification to other markets – regional languages, other markets
■ Based on geography, products and services
Boundaries of the firm

■ The boundaries of a firm have vastly changed with the advent of digital platforms.
■ Simply put Byju's has about 5.5 million subscribers and a claimed 80 million users and employs
10000 people.
■ They target early learning, school and university.
■ Focus on new areas like coding, games and apps.
■ A traditional offline education firm would simply not be able to operate with these numbers and
variety offered.
■ No data about any decision shrinking the boundary until now
■ Every acquisition decision has expanded the boundary by offering new products to new markets
■ PAT of 20 cr. for a revenue of 1036 cr. in FY19
Conclusions

■ Byju’s have tried to make of the possibilities of economies of scope and scale in their
activities
■ They have leveraged existing infrastructure to reduce the transaction costs to their
advantage but, with limited success
■ Decided to “Make” to ensure quality of offerings initially
■ Pressure for growth from investors, market pressure to sustain dominance and plateauing
of revenue from online classes made them choose the inorganic growth route - “Buy”
■ The boundaries of the firm have expanded consistently to become the most valuable
edtech company in the world
THANK YOU