UpGrad, a well-known unicorn in the edtech space with headquarters in Mumbai, has received a sizable debt financing deal from EvolutionX for Rs 287.5 crore, or around $35 million. Entrackr claimed that the board of upGrad has approved a special resolution to issue 2,875,000 debentures at an issue price of ₹1,000 each, based on upGrad’s regulatory filings obtained from the Registrar of Companies (RoC). Through this action, ₹287.5 crore would be raised in total.
Goal of Fundraising by upGrad
According to the report, fundraising aims to support the company’s strategic aspirations and maintain operational effectiveness through several significant objectives. The primary purpose of the raised funds is to help the company’s growth trajectory by allowing it to scale its operations and increase its market presence. This deliberate investment of funds demonstrates the company’s dedication to strengthening its infrastructure and capabilities to meet growing demand and seize new market possibilities.
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Furthermore, the funds will guarantee seamless operational continuity and pay for necessary operating expenses for daily business operations. The money supports upGrad’s expansion objectives by aligning with its strategic goals. This allows the company to innovate within the competitive edtech sector, expand into new areas, and improve its service offerings. The emphasis on expansion, operational sustainability, and strategic alignment highlights the critical role that fundraising plays in nurturing upGrad’s long-term success and market leadership in the education technology sector, even though specifics regarding fund utilisation were not provided in the filings.
Increased Support from Prominent Investors
UpGrad has received significant support from a wide range of prominent investors, contributing to its remarkable fundraising total of over $700 million. The business raised $36.5 million in a proper issue in March of the previous year, with the help of Temasek, founder Ronnie Screwvala, and other notable investors. This funding round demonstrates the high level of investor trust in upGrad’s strategic vision and development potential in the cutthroat edtech market.
Several prominent investors, including TOEFL, Artisan Partners, IIFL Finance, International Finance Corporation, Kaizenvest, 360 One Asset, and Unilazer, have contributed financial backing and strategic knowledge to advance upGrad’s global plans. This varied investor base demonstrates upGrad’s attractiveness to institutional and international investors and puts the business in a good position for growth.
UpGrad has seen increased losses in addition to strong revenue growth, with revenues rising by 72% to Rs 1194 crore in FY23 from Rs 692 crore in FY22. In FY23, these losses increased by 82% to Rs 1,114 crore, which can be attributed to the aggressive expenditure in expanding the market and scaling operations. Despite immediate financial difficulties, this development trajectory highlights upGrad’s strategy focus on gaining market share and investing in future growth drivers.
