Adda247, a test prep platform for government, railways, and public sector jobs is in talks to raise a fresh round of funding from existing and new investors after talks for its acquisition by Unacademy didn’t work out, according to two sources aware of the development.
The fresh funding round would come after a gap of almost two years for the Gurugram-based company which raised $6 million in its Series B in November 2019.
“Existing investors including Info Edge are in late-stage conversations to lead a $10 million round in Adda247. The outline of the deal is almost finalised and it may materialize soon,” said one of the sources on the condition of anonymity.
The person added that Info Edge, now a marquee investor after its massive success with Zomato and Policybazaar, would lead the new round.
Sources emphasized that the conversations with existing investors started after Adda247’s acquisition talks with Unacademy didn’t go through. According to a report by The CapTable, the two companies were in advanced talks for a deal since June.
“Differences over valuation was a major reason for the fall-out of the talks. Adda247 was seeking over $40 million in the buyout. However, Unacademy wasn’t convinced and looked at a lower sum,” said the second source who also wished not to be named.
As of November 2019, Adda247 had raised $10 million and was valued at around $25-30 million. Entrackr couldn’t independently verify the reason behind the fallout of the deal with Unacademy.
Responding to Entrackr’s queries, Adda247’s co-founder Anil Nagar denied this development and said, “this is all incorrect.” Queries sent to Unacademy and Info Edge on late Monday did not elicit a response until the publication of the story. We’ll update the story in case they do.
While the Indian startup ecosystem has seen massive consolidation in the edtech space in the ongoing calendar year, this is one of the rare instances where the acquisitions talks fell through even after several months of engagement.
Last year, a similar deal in the making between Byju’s and doubt clearing edtech platform Doubtnut was called off. Entrackr had exclusively reported about the talks and how it had fallen through here and here.
Founded by Nagar and Saurabh Bansal in 2010, Adda247 provides an online test preparation platform that offers videos, live lectures, ebooks for UPSC, IIT, SSC, banking, insurance, teaching, railways, defence and state-level competitive entrance exams. While the company is yet to disclose its annual financial statement for FY21, it had recorded a revenue of Rs 47 crore in FY20 with a loss of close to Rs 8 crore.
According to the company’s website, it operates across more than 450 coaching centres in India and offers live and on-demand courses. The company competes with Matrix and Iron Pillar-backed Testbook and Pariksha, among others. Pariksha had raised $2 million in a pre-Series A round led by Bharat Inclusion Seed Fund.