Unacademy Founders Step Back from Operations as Company Implements Strategic Shift
Unacademy, a leading player in India’s edtech sector, is set to undergo a significant leadership transition as co-founder and CEO Gaurav Munjal prepares to step down. Sumit Jain, a current board member and former founder of Opentalk, will take over the CEO role. This change comes amid a strategic shift for the Bengaluru-based company, which is refocusing its efforts on its language learning application, AirLearn, after facing challenges in expanding its offline coaching initiatives.
Leadership Changes and Strategic Shift
The impending departure of Gaurav Munjal marks a crucial turning point for Unacademy, especially as it follows the exits of fellow co-founders Roman Saini and Hemesh Singh. This trio, which originally launched Unacademy as a YouTube channel a decade ago, has now stepped back from operational roles. Munjal’s exit is reportedly the result of extensive discussions with the board, which highlighted his reluctance to lead the company’s offline coaching expansion. As part of the transition, the founders are expected to receive cash payouts while retaining their equity stakes in the company.
Unacademy has been navigating a challenging landscape since the pandemic, with a notable shift from online test preparation to offline coaching centers. This pivot has proven difficult, particularly as the edtech sector has seen reduced funding and a pullback in consumer interest. Earlier this year, the company attempted to negotiate an acquisition with Allen Career Institute, but discussions fell through due to disagreements over valuation.
New Leadership and Future Directions
Sumit Jain, who co-founded Commonfloor and previously led Opentalk, will now steer Unacademy as CEO. His appointment comes at a time when the company is recalibrating its focus towards AirLearn, a language learning application that has gained traction with 70,000 daily active users and has generated $2 million in annualized revenue. AirLearn, which was formerly known as Unacademy Languages, is being incubated under Unacademy Inc., a Delaware-registered entity. Preliminary funding talks for AirLearn are already in progress, with expectations of support from existing Unacademy investors.
The board of Unacademy includes prominent investors such as SoftBank, General Atlantic, and Nexus Venture Partners. The founders, Munjal and Saini, each hold a 3.4% stake, while Singh has a 2.2% stake. Institutional investors collectively control significant portions of the company, with Nexus and Peak XV holding around 14% each, SoftBank at 12%, and General Atlantic at 11%.
Financial Performance and Challenges
Unacademy has faced financial challenges in recent years, reporting a 7% decline in operating revenue for FY24, totaling Rs 840 crore. However, the company has managed to narrow its net losses by 62% to Rs 631 crore, largely due to aggressive cost-cutting measures and layoffs. In a recent town hall meeting, Munjal revealed that the company’s annual cash burn has significantly decreased from over Rs 1,000 crore to under Rs 200 crore. Currently, Unacademy holds reserves of approximately Rs 1,200 crore (around $140–150 million).
As Unacademy adjusts its strategy, it faces increasing competition from rivals such as Byju’s-owned Aakash Institute and PhysicsWallah, which has recently filed confidential IPO papers with an estimated valuation of Rs 35,000–40,000 crore. The leadership changes and strategic refocus come at a critical time as the company seeks to stabilize its position in the evolving edtech landscape.
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