ETtech Top 5: Vedantu’s $100M financing, Twitter’s biggest hack & more

Investors are turning more bullish on India’s online education sector, that is witnessing stupendous growth amid the pandemic

Meanwhile, Twitter suffered its biggest security breach in the company’s history as hackers got access to some of the most popular accounts on the platform

Vedantu‘s $100 million fundraising

Education technology firm Vedantu has raised $100 million in Series D funding, led by US-based Coatue Management with participation from existing investors Tiger Global, GGV Capital, Omidyar and Westbridge Capital. The fundraising values the firm at $600 million, making it the second most valued Indian ed-tech startup after Byju’s that is currently valued at $10.5 billion.

This is Vedantu’s third fundraising in the past 12 months and has now raised a total of more than $200 million as of now

Where will the money go?

The company will use the proceeds raised to add new categories of Grade 1-5 education as well as invest in content and technology. Vedantu has said it registered a 220% growth in users to 2 million unique students who attended its live classes during the past three months.

The growth is largely driven by a massive increase in paid subscribers on Vedantu’s platform, which was at 50,000 last year, but has been growing by about 20,000 new users each month following a nationwide lockdown at the end of March 2020.

Edtech boom

India’s ed-tech sector is witnessing unprecedented interest from investors due to the increased digitisation of education amid the Covid-19 pandemic, which is driving significant growth for edtech firms.

Unacademy is currently in talks to rack up about $100-$150 million at a $1 billion valuation and has also acquired a couple of startups in recent weeks including medical entrance preparation platform PrepLadder and online learning platform Mastree.

Byju’s has landed funds from Mary Meeker’s Bond Capital at a valuation of $10.5 billion last month and has made a $300 million offer to buy smaller peer Whitehat Jr, which incidentally is also in talks with Steadview Capital and Tiger Global to pull in new capital at a valuation of $350 million. Byju’s is also said to be in advanced stages of talks to acquire learning app Doubtnut. Read more.

Twitter’s big hack

Twitter witnessed its biggest-ever security breach on Wednesday that compromised the platform’s most popular accounts including Barack Obama, Jeff Bezos, Elon Musk, Kanye West, Kim Kardashian, and Joe Biden. These accounts were used to send out fake tweets that invited people to send them Bitcoin and get them doubled in return.

Following this, Twitter took a drastic measure of locking a large group of verified accounts, preventing them from sending messages altogether, while it investigates the hack and takes steps to fix it.

According to Motherboard that obtained screenshots shared by several underground hacking communities, hackers gained access to the company’s internal administration tool that made it easier to take over these accounts.

What are they saying?

Twitter indicated that some of its employees were involved in the hack, saying it was likely “a coordinated social engineering attack by people who successfully targeted some of our employees with access to internal systems and tools.”

Chief executive Jack Dorsey also pledged to share “everything we can when we have a more complete understanding of exactly what happened.”

Twitter said it is also limiting access to the company’s internal systems and tools amid the ongoing investigation.

However, several cybersecurity experts have raised concerns over this hack, saying this breach could have dire consequences in terms of user trust, especially since several government leaders and celebrities use this platform to make public statements. Read more.

Netflix‘s India content expansion

Netflix has expanded its India slate of original content with eight new titles including six original films and two original series across various genres like thrillers, romantic comedies, and lighthearted dramas.

The streaming platform also said it plans to debut overall 17 India original titles on its platform in the coming months. These include several films that were originally slated for a theatrical release but are now opting for a digital premiere since theatres are currently shut due to the pandemic-induced lockdown.

Things to note

• Netflix now has commissioned overall about 50-60 productions in the country, its largest investment in original programming outside the United States.
• Netflix has released 19 India original films and 14 series so far
• Last year, the streaming service had committed a Rs 3,000 crore content programming budget for the India market across 2019 and 2020.
• Netflix had added 3.6 million paid members in the Asia Pacific region in the quarter ended March 2020. Overall global additions were at 15.8 million and the total base is currently at 182.9 million subscribers.

What about others?

• In June, Disney-owned video streaming service Disney+ Hotstar announced they will be premiering seven Hindi movies that were originally slated for a theatrical release

• Amazon Prime Video had picked up seven Bollywood and regional films including Amitabh Bachchan-Ayushmann Khurrana’s ‘Gulabo Sitabo’ and Vidya Balan-starrer ‘Shakuntala Devi’ last month for a direct-to-digital premiere

• Essel Group’s ZEE5 and Times Internet*-owned MX Player have also ramped up content programming on their respective platforms, to cater to the surge in content consumption in the country. Read more.

Quiet rise of a startup hub

Chandigarh is quietly rising as a startup hub with several entrepreneurs preferring the city over bustling startups hubs like Bengaluru, with its traffic snarls, and Delhi-NCR, with its pollution woes.

There are over 700 active startups in Chandigarh as of July 9 and more than one-third of these were founded in the last four years, according to startup analytics firm Tracxn

The growth is also aided by four-to-five major co-working spaces that have come up in the Tricity area — Chandigarh, Panchkula, and Mohali — in the last three years.

Challenges

Chandigarh however faces a lot of challenges to scale up to the level of a Bengaluru. Among the key challenges include:

• Hiring tech talent
• Infrastructural issues like an undeveloped airport

Covid-19 virus outbreak and the subsequent lockdowns is however making startup founders evaluate the merits and comforts of startup ecosystems like Bengaluru and could boost startup creation in smaller cities. Read more.

Instagram Reels global debut

Facebook is set to launch its Tiktok-like feature Reels in the United States and more than 50 other countries in the coming weeks, according to an NBC report. This launch comes at a time when the United States is mulling a ban over TikTok and other Chinese social media apps over the handling of user data and rising tensions with China.

India pilot

Facebook rolled out a broad pilot of Reels in India last week, shortly after the Indian government banned the Bytedance-owned short video platform and 58 other apps citing security concerns. The feature is also currently being tested in Brazil, Germany, and France.

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(Illustrations and graphics by Rahul Awasthi)

*Disclosure: Times Internet owns ETtech