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Edtech unicorn Unacademy is eyeing expansion into new categories like finance education, study abroad, and higher education, among others.
Vivek Sinha, COO, Unacademy told BusinessLine that the company's plan going forward is to grow with a focus on profitability. "Keeping that high-level view, the focus will be on adding new categories which are large in size and have decent margins," he added.
As part of its growth plans, Unacademy is also looking at entering adjacent markets outside India. While international expansion is not planned in the immediate 90 days, Sinha said that Unacademy is not striking it out from this year's (2022) plan.
"We are evaluating all sorts of expansion opportunities and we are slowly and carefully making investments in those projects as well," he added. The company is also eyeing an initial public offering in the next two years.
Cost cutting
In the past few months, Unacademy has sharpened its focus on profitability and also cut costs in the face of a global funding crunch. Similar to other edtech unicorns, Unacademy has also laid off hundreds of employees and implemented various cost-cutting measures to focus on profitability and increase efficiency.
Some of these measures included pay cuts for founders and management, shutting down Unacademy global test prep platform, and discontinuing complimentary meals and snacks, among others. In July, CEO Gaurav Munjal asked employees in a company-wide Slack message to develop frugality as a core value.
Talking about the transition to such a frugal operational style, Sinha said, "Fixing cost structures and gunning for profitability while growing is of course challenging. The good part is that we have been able to maintain our revenues while becoming efficient. Our cost structure has improved a lot. It required a fair amount of maneuvering but it was not extremely difficult because our unit economics has always made sense."
He added that Unacademy is present in 130 categories and that has proved to be a strength for the company.
Furthering effort
The categories Unacademy launched in 2020 are said to have become profitable. The categories that were launched in 2021 are near profitability and the newer categories will take time.
"We are now thinking of making the existing portfolio profitable before starting out too many new categories. We have become more judicious or prudent about which categories to launch. Let's say, if last year we were happy with a 50 per cent hit rate. This year, we are gunning for a 95 per cent hit rate in launching new categories, said Sinha."
Earlier this week, Unacademy launched 50 new YouTube channelslike IAS Icons, Tick Tock Tax and The 99 Percentile club, among others. Free content marketing on YouTube is one of the biggest customer acquisition channels for Unacademy, contributing over 50 per cent to its acquisition.
"We are not a sales or feet on streets heavy company. We have very few people in the sales team compared to other larger edtech players. Similarly, our paid marketing or digital marketing expenses are also very minuscule compared to any other company that has revenues based on a service. So most of our revenue comes from these educational channels which distribute content for free. With these new channels, we are just furthering our effort," said Sinha.
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