MUMBAI, 10 AUGUST, 2020 (GPN): The Covid-19 pandemic has forced millions of children to go online to learn and the new national education policy places significant emphasis on digital learning. Education is a big business in India and parents are happy to spend money on getting their children a ‘decent’ education. BYJU’S understanding here on WhiteHat Jr. a fast-growing company with a savvy marketing engine and great unit economics in a hot sector where larger competitors are steeped in an intense land grab. If one doesn’t acquire the company, another might.

WhiteHat Jr., a Mumbai-based startup that provides an online platform where school children (aged six to fourteen years) can learn coding and build commercial-ready games, animations, and apps. The Bengaluru-based unicorn acquired the two-year-old startup for $300 million, in an all-cash deal.

BYJU’S is one of the most-funded education startups in the world, having raised around $1.6 billion through 16 funding rounds. Its marquee investors include Facebook Co-founder and CEO Mark Zuckerberg, China’s Tencent, South African private equity firm Naspers, and Silicon Valley venture capitalist Mary Meeker’s Bond Capital.

WhiteHat Jr. is Byju’s fifth and largest acquisition till date. It all started with a simple WhatsApp message.The deal was struck over a span of six weeks through WhatsApp messages and Zoom calls between BYJU’S Founder and CEO, Byju Raveendran, and WhiteHat Jr. Founder and CEO, Karan Bajaj, who will continue to lead the company post the acquisition.

On the WhiteHat Jr. deal, Byju said, the Bengaluru startup was able to build conviction “really fast” around two things. “One, it’s adding a subject like coding, which is an important future skill, and the growing percentage of parents and students who realise it. The second one is that it’s also giving us an opportunity to accelerate our international expansion, to begin with, the US.”

Byju revealed that he got his six-year-old son Nish on the WhiteHat Jr. platform around the time he started conversations with the Mumbai startup, in a bid to evaluate the platform.

“My son is on the platform. I introduced him to this platform only couple of weeks back, also as an evaluation thing. I was really impressed with not just how he got excited about this, (but also the fact that) the paid user NPS (Net Promoter Score) is very high, similar to what we have for BYJU’S,” he said. NPS measures customer experience and predicts business growth. Simply put, it is a tool used to gauge customers’ overall satisfaction with a company’s product or service and the customers’ loyalty to the brand.

In January 2019, Byju’s acquired US-based educational games maker Osmo for $120 million. The latest acquisition will help Byju’s strengthen its presence in the US market since WhiteHat Jr. has over 20,000 paid American subscribers, as on June 2020, which accounts for nearly 60 percent of its revenues, with the rest coming from India. “When we met them, they were around $75 million (annual revenue) run rate, now they are at $150 million run rate,” Byju said.

Byju’s earlier acquisitions include Math Adventures, TutorVista, and Vidyarth.

Coming back to the WhiteHat Jr. acquisition, Byju said the decision to go through with the deal was taken rather swiftly, thanks to online meetings, which are now part of a new world order amidst the coronavirus pandemic. ENDS