The Indian ed-tech sector is again undergoing a massive transformation. Well, in the past we have seen the fall of Byju’s, but now the news headlines are being occupied by the Byju’s rival Unacademy.
But what we need to understand is that it is not closing its business or expanding but getting acquired by a player in the ed-tech space called UpGrad.
Now, what we need to understand is not just the acquisition but also the rationale behind the move by upGrad and Unacademy. Connecting dots will help us to get a clear picture.
So, in this article, let’s connect the dots related to this issue and explore more. But before that, first let us understand what the news is and what’s happening.
As per reports from The Economic Times, Moneycontrol, and Mint, upGrad is in advanced discussions to acquire Unacademy through a share-swap deal. The discussions are centered around upGrad’s valuation of nearly $2 billion and Unacademy’s $300–$400 million valuation.
Interestingly, Unacademy reportedly has ₹1,200 crore in cash reserves, which makes the deal more attractive for upGrad. If structured well, the acquisition could give upGrad both a top-of-funnel audience and liquidity strength.
But what makes this deal fascinating is not the price; it’s the strategic logic behind it. Because at first glance, it looks counterintuitive: why would a company like upGrad buy a company that’s still struggling to find profitability?
To understand that, we need to step back and look at the journey of both companies. Unacademy was founded by Gaurav Munjal, Roman Saini, and Hemesh Singh, democratizing education by giving anyone with internet access the ability to learn from top educators.
During the pandemic, Unacademy became one of India’s fastest-growing startups. It expanded aggressively by acquiring startups like PrepLadder, Graphy, and CodeChef, and building a strong brand around its star educators. By 2021, it had raised over $440 million, with a valuation touching $3.44 billion.
Now as the pandemic fear faded, they slowly expanded into offline centers. Setting up physical centers demanded real estate, capital, and operational efficiency areas where traditional coaching brands had decades of experience. At the same time, online student engagement dropped, forcing Unacademy to reduce costs, cut staff, and shut down non-core verticals. But Unacademy slowly started to struggle financially, and revenues declined.
On the other hand, upGrad took a very different route. It built quietly, focusing on higher education, professional learning, and enterprise training. In FY25, upGrad reportedly turned EBITDA positive, and it’s already gearing up for a potential IPO.
So, now UpGrad is positioned well, compared to other ed-tech firms. Well, if we try to connect the dots. upGrad dominates the higher education and skilling segment, like degrees, MBAs, and corporate learning programs. Unacademy owns the test-prep and early-stage learner space. Together, they create a complete funnel from school to college to career.
Even after its slowdown, Unacademy still holds immense brand equity and a community of millions of learners and educators. For upGrad, acquiring that brand at a fraction of its former valuation is a smart long-term bet.
Unacademy is not a failed company, just that the finances and valuation don’t seem to be justified. Now buying the company at the level is a great win for UpGrad. With Unacademy’s growing network of offline centers in cities like Delhi, Kota, and Hyderabad, upGrad gains an instant offline presence, something that would take years to build organically.
What makes this even more interesting is that Unacademy still sits on nearly ₹1,200 crore in cash reserves, which is a rare position of liquidity in today’s edtech landscape. That combination of leaner operations and strong cash on books makes it a highly attractive acquisition target.
If we put all these reasons aside and look at the internal changes. Just a few months ago, Moneycontrol reported (May 2025) that Unacademy’s founders, Gaurav Munjal and Roman Saini, had started shifting their focus toward AirLearn, the company’s AI-driven learning initiative.
This shift suggests that the Unacademy founders are preparing for the next phase. Now UpGrad taking over Unacademy is a strategic move and helps the company to streamline operations and expand into new segments.
But the new set of challenges will come up, such as talent retention. Unacademy’s top educators are its heartbeat. If they don’t see alignment post-merger, attrition could hurt both revenue and credibility.
As of now, there’s no official confirmation from either company. Both Unacademy and upGrad have kept silent on the matter, and the reported deal remains in the discussion stage.
However, if the acquisition does go through, it will mark one of the most defining moments in India’s ed-tech industry, signalling a shift from hypergrowth to strategic consolidation.
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