Here’s why Doubtnut is an attractive buy for Byju’s and Unacademy

• Byju’s and Unacademy are reportedly in talks to acquire Doubtnut — a doubt clearing app catering to students from sixth grade onwards for maths and science subjects.
  
• Interestingly, all the three edtech startups have been funded by the venture capital firm Sequoia Capital.
  
• Doubtnut took its total user count over 13 million before the COVID crisis led to an increase in online training.
  
• According to the startup, 90% of its users come from Tier II and Tier III cities because of its multilingual offering – Doubtnut operates in 11 languages.

As edtech companies gain in India, the spotlight has been on the two-year old edtech startup Doubtnut – a doubt clearing app catering to students from sixth grade onwards for maths and science subjects.

Byju’s and Unacademy are reportedly in talks to acquire Doubtnut. According to a TechCrunch report, Byju’s is in advanced-stage talks to acquire Doubtnut for nearly $125 million, while Unacademy too is looking to buy the edtech startup.

In January, Tencent invested $15 million in Doubtnut along with participation from its existing investors — AET, Japan, Sequoia Capital, Omidyar Network and Ankit Nagori of Cure.Fit.

Interestingly, all the three edtech startups have been funded by the venture capital firm Sequoia Capital.

Sources: media reports

Business Insider wrote to Byju's and Unacademy for their comments, while Unacademy refused to comment at this moment, we will update the copy with Byju's responses as they come in.

What makes Doubtnut a profitable choice for Byju’s and Unacademy

Doubtnut took its total user count over 13 million before the COVID crisis led to an increase in online training. The video sessions on the app explain the step-by-step process to solve a problem. The snapshots of the problem can be sent via the Doubtnut app, website or even WhatsApp.

According to the startup, 90% of its users come from Tier II and Tier III cities because of its multilingual offering – Doubtnut operates in 11 languages. And its potential in reaching out to the next 400 million Internet users of India could be what got Byju’s interest.

“We are planning to go international in the next few months but we are also going deeper in India. 65% of our students are outside the top 10 cities, that showed us it is an aspirational product for students who don’t have access to good education,” Divya Gokulnath, co-founder and director at BYJU’s told Business Insider in an earlier interview.

As of now, the instant doubt resolution application has answered over 250 million queries across subjects such as mathematics, physics, chemistry, and biology.

Targeting the smaller regions, Doubtnut could soon come up with content for state board schools. “The biggest challenge that students have while studying, online or offline, is doubt resolution. Nearly 80% of the time spent by the student is on practice and doubt resolution. We provide solutions using technology and content. We have the largest repository of video solutions in the world," Tanushree Nagori, co-founder of Doubtnut told Mint in February.

Byju’s and Unacademy both have the capital for acquisitions

With the coronavirus lockdown and schools, colleges being shut, Indian edtech startups have seen an unprecedented boost in their numbers and investors too are betting big on the space.

And both Byju’s and Unacademy have been at the forefront of raising big money from marquee investors.

Recently, Byju’s raised an undisclosed amount of funding from BOND – the global technology investment firm. This is BOND’s first investment in India. In February, Byju’s raised $200 million from the private equity firm General Atlantic.

Meanwhile, Unacademy too secured a $110 million funding from Facebook and General Atlantic for over $500 million during the same time.

See also:
INTERVIEW: Paytm exec reveals how the contactless dining project was executed in just a month

Hiring this week — Well Fargo, EY, Goldman Sachs and others are looking for technical analysts and finance professionals

Four types of Chinese apps making big money in India — experts believe at least three should be done away with