TPG to invest $150M in Indian edtech start-up Eruditus
Eruditus, an Indian edtech start-up, is reportedly on the verge of securing a significant investment from TPG, a major private equity player. The latter is said to be in advanced discussions to lead a funding round worth about $150 million for Eruditus, per TechCrunch. This potential deal could mark one of the largest fundraises by an Indian education company in recent years. The new investment would value Eruditus at up to $2.3 billion, according to proposed terms shared by sources.
Valuation depends on performance targets
The proposed $2.3 billion valuation for Eruditus is contingent upon the start-up meeting specific performance targets. Failure to achieve these milestones could result in a reduced valuation of at least $1.8 billion. The potential new valuation represents a decrease from the $3.2 billion at which Eruditus was valued during its last funding round in August 2021.
Business model and future plans
Eruditus, established 14 years ago, partners with top global universities to offer executive education programs for businesses/individuals. The start-up generates over two-third revenue from international markets. The discussions to raise funds began last year with an initial plan for a $50 million secondaries round where some early investors would exit. However, after achieving a full year of EBITDA profitability, Eruditus decided to initiate a larger round and close it before relocating its base back from Singapore to India.
Funding history and future domicile shift
The proposed $150 million will be Eruditus's first significant equity round since August 2021. Since then, Eruditus has only secured debt from various institutions. In 2022, it bagged $350 million in debt from Canada Pension Plan Investment Board (CPPIB), a global investment management firm, to fuel mergers and acquisitions and consolidate position in a competitive market. The SoftBank-backed start-up wants to shift its domicile from Singapore to India over the next 12-18 months.
