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Edtech

Not just another edtech story: Inside PhysicsWallah's Rs 1,131 crore loss

Nikhil Patwardhan

November 12, 2024 | 10 Min Read

November 12, 2024 | 10 Min Read

From a profitable bootstrapped startup to a loss-making unicorn, PhysicsWallah's journey mirrors its peers at first glance. But with low customer acquisition costs and strategic acquisitions, the edtech company is writing its own playbook as it prepares for an IPO.

Key Takeaways

PhysicsWallah’s revenue skyrocketed by over 160% in FY24, despite a slowdown in the wider edtech space
However, this impressive growth came with a price, as the company reported a loss exceeding Rs 1,100 crore for the year
At first glance, it appeared that PhysicsWallah—once notable for its profitability—is following in the footsteps of other VC-backed edtech firms
But a closer look at its balance sheet reveals a different story: while the company struggled to control its expenses, the nature of its spending differed significantly from that of its peers

Last week, PhysicsWallah—one of India's hottest edtech companies—released its financial results for the year ended March 2024 (FY24). While the company’s revenue soared 160% to Rs 1,940 crore, what caught the eye was the company’s record loss of Rs 1,131 crore. The Noida-headquartered edtech even revised its FY23 bottom line from a profit of Rs 9 crore to a loss of Rs 84 crore.

While loss-making edtechs are hardly a rare breed, PhysicsWallah, best known for its charismatic founder and star educator Alakh Pandey, initially garnered eyeballs because it was actually profitable.

Indeed, since its founding in 2020, PhysicsWallah had consistently turned a profit. In FY21, its first operational year, it posted a nearly 30% net profit margin on modest revenues of Rs 25 crore. Its net profit margin improved to 42% the following year.

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