WestBridge leads $35 Mn Series C round in edtech startup Sunstone

Higher education-focused edtech firm Sunstone has raised $35 million in a series C funding round led by WestBridge Capital with participation from existing investor Alteria Capital. This is the second round of funding for the company in less than one year.

Sunstone plans to use the fresh capital to launch new programs with a focus on undergraduate tech programs, the company said in a statement. Importantly, the company did not disclose its valuation after the infusion of the fresh round.

In October 2021, Sunstone raised $28 million in Series B funding from WestBridge. The round also saw the participation of Saama Capital and Alteria. Previously, it had raised nearly $3 million in a series A financing round from some of the above-mentioned investors and a clutch of individual investors.

Founded in 2019 by Ashish Munjal and Piyush Nangru, Sunstone works with academic institutions to help upskill undergraduate and postgraduate students for employability. The company has a presence in more than 35 cities across over 40 institutions and now aims to expand it to 100 cities.

Sunstone’s new round comes amid the so-called “funding winter” that has forced the startups to take drastic measures to achieve profitability. Edtech firms, in particular, have been adversely impacted.

Funding in edtech startups declined from $5.82 billion in 2021 to $2 billion in 2022 till August 15, according to our data tracking platform Fintrackr. In addition to plummeting funding, many edtech firms have resorted to layoffs in an attempt to cut down on expenses and extend their runaway. The data further suggested that edtech accounted for nearly 30% of overall layoffs in the Indian startup ecosystem.

Earlier this year, WestBridge had led $100 million financing in School edtech startup LEAD, which also turned unicorn during the Series E round. The investment firm’s edtech portfolio includes Adda247 and K12. Entrackr was the first to report Adda247’s $20 million round in November last year.

Sunstone is yet to reveal the financial results for the fiscal year ending March 2022 but it remained a pre-revenue entity in FY21. The company had ended FY21 with zero operating revenue and Rs 15.45 crore loss, as per its annual financial statement with the Registrar of Companies (RoC).