A relevant problem to address, a working product yet to develop, a visionary business plan, and an entrepreneur set to fulfill his ambition. This way, the journey of India’s one of the successful ed-tech companies started in 2018, WhiteHat Jr.
Mr. Karan Bajaj began with initial funding a $1.3 million without actually registering the company. He started the company to solve a personal problem. He wanted his kids to be at the center of creating technology rather than consuming it. White Hat Jr. offers AI-based courses to children aged between 6-18. It is a live online coding class for kids.
In 2030, AI and robotics will touch 800 million jobs, splitting the world into creators and consumers. The company wants to empower children so that they can view themselves as creators. All classes take place via a live 1:1 online platform. Around 7,00,000 students have registered on the platform, which conducts 7,000 live online classes daily. The company has achieved an NPS of 68%, with a student renewal rate of around 75%, and a refund rate of 3 percent.
Business model
The company’s product, its curriculum for students, is divided into four categories:
- Beginner
- Intermediate
- Advanced professional
- Applied tech
Beginner course focusses on Grade I students offering them the conceptual understanding of building apps with logic, app developer certificate courses, and advanced coding with space tech. The intermediate course is for Grade 2-3 students, focussing on building cutting-edge art and single-character game through blockly.
The advanced curriculum concentrates on kids from Grade 4-6, where the focus is to impart learning about logic and abstraction to build games that are market-ready and apps with UI/UX interface. It targets students from Grade 7-9, making them learn about complex, advanced games through professional courses.
The applied tech course focuses on advanced coding skills, phyton algorithms, and their application, along with a data analytics course. The prices for these courses range from Rs 5,999 to Rs 99,999. The average ticket size for courses is around Rs.37,000. The company raised another $10 million in funding from Nexus Ventures Partners, Omidyar Network India, and Owl Ventures.
The company now has 7,000 teachers teaching through its platform. The company maps its students and teachers based on their language, enabling them to switch between languages. The company has scaled itself significantly from a seven-member team to 4500 employees and ~9500 teachers.
Company Growth
WhiteHat Jr. started overseas operations in Canada, UK, Australia, New Zealand, Germany, and Singapore. In the second phase, in November, the company will launch its courses in Japan, Brazil, and Indonesia in the local dialects. WhiteHat Jr’s 50% revenue comes from the domestic market and the other half from international markets such as the USA, UK, and Australia.
The company’s 50% of domestic consumers lie in the tier-II and tier-III cities of India. The non-metros contribute nearly 65% of the firm’s total revenue. The company plans to develop a 1:2 live online class model, considerably reducing students’ fees. The company was doubling its revenue month on month basis before lockdown and amid lockdown, the company’s revenue went from 1 crore to Rs. 10 crores. The implementation of lockdown drove children/students towards EdTech space. The new education policy in India also promotes coding from early classes. All these factors contribute to the company doubling its annual revenue run rate.
The competitors for the firm include Vedantu, Unacademy, Toppr. The WhiteHat Jr business model focuses on children being creators of the future, which differentiates it from the rest of its competitors in the same segment. The online coding classes are gaining a lot of attention, and the company has distinguished itself in this segment. The company also targets its potential customers through strategic marketing, which appears logical to the people, and they see the value proposition in their products.
Acquisition by BYJU’s
In 2020, White Hat Jr made one of the largest (fifth largest) and fastest venture exits when BYJU’s parent Think and learn acquired it for $300 million in an all-cash deal. As per the agreement, Mr. Bajaj will continue to lead and scale business in India and the US.
The acquisition will allow BYJU’s to launch coding for children in a niche but rapidly expanding K-12 (Kindergarten to 12th grade) space. The deal brings in funds for WhiteHat Jr as BYJU’s plans to make significant investments in the company’s platform and product innovation. Recently, BYJU’s infused Rs.136 crores in WhiteHat Jr.
This acquisition allows WhiteHat Jr to scale its business and also expand globally. After the purchase, its annual revenue run rate increased from $150 million to $220 million. The company is adding 220 women teachers per day to its workforce as the company plans to have 20,000 educators by the end of 2020.
Marketing strategies
The company’s successful run is a result of its agile digital marketing strategies. It uses digital marketing for lead generation and conversion. The company focuses more on B2C marketing. As per Mr. Bajaj, the company spends nearly 50% of ad spends on TV advertisements targeting India’s general masses.
The company’s social media advertisements are future-oriented, showing how the company’s service can help students be creators in the future. Its recent TV advertisement shows a boy Chintu who developed an app at an early age, and the investors are fighting to invest in that app. Such advertisements capture the attention of people in the technology platform.
The company is endorsed by celebrities such as Sonu Sood, generating a lot of goodwill. The online content of the company also featured Mark Zuckerberg, Sundar Pichai, Bill Gates. The company’s repeated targeted advertisements generated a lot of flak from people, with many trolling it over social media platforms. The company turned this flak into an opportunity by attracting more media attention due to its acquisition by BYJU’s.
Conclusion
The COVID-19 has accelerated the company’s month on month growth to more than 100 percent and a massive spike in student enrolment. The company already had positive cash flows to invest in their business. India’s EdTech sector is likely to grow 3.7 times in the next five years, from $2.8 billion to $10.4 billion by 2025. The company’s plan to scale the business is in line with the growth in the EdTech space. With the acquisition by the largest EdTech company in India, WhiteHat Jr is here to revolutionize learning.
Also, read about WhiteHat Jr. & WhiteHat Sr. Controversy