Sequoia Backed Scaler Acquires Delhi-Based Edtech Startup Pepcoding

The performance of edtech startups in India has been a mixed bag, with some experiencing significant growth and others facing challenges. Upskilling platform Scaler, backed by prominent investors including Sequoia Capital, Tiger Global, and Lightrock India, acquired Delhi-based edtech firm Pepcoding. This marks Scaler's fourth acquisition, demonstrating its commitment to growth and diversification. 

The COVID-19 pandemic acted as a catalyst for the adoption of online learning platforms, leading to a surge in demand for edtech services. However, the reopening of educational institutions and the gradual return to in-person learning posed new challenges for the sector.

While the financial details of the transaction remain undisclosed, Scaler expressed confidence in the potential of this acquisition to support various aspects of its business operations, including strategy, product design, B2B enterprise, operations, and instructor organization.

How Does Scaler Empower Tech Talents and College Students?

Founded in 2019, Scaler offers upskilling courses targeted at college students and tech talents. Its commitment to quality and industry relevance has led to collaborations with major tech giants such as Microsoft, Google, and Amazon for placements. The company had previously raised USD 55 million in a Series B funding round in February of the previous year. In March, it was reported that Scaler was seeking to raise an additional USD 50 million to further fuel its expansion.

How Scaler is Building Its Portfolio Through Strategic Acquisitions?

Scaler's latest acquisition of Pepcoding follows a trend of strategic acquisitions over the past two years. In March of the prior year, Scaler acquired online learning platform AppliedRoots for USD 50 million, bolstering its online learning capabilities. In 2021, it further strengthened its operations through the acquisitions of Coding Minutes and Coding Elements. These strategic moves have allowed Scaler to expand its reach and enhance its value proposition to students and professionals seeking upskilling opportunities.

As part of the acquisition, Sumeet Malik, a co-founder of Pepcoding, has joined Scaler as a teacher and content producer playing a crucial role in enhancing the learner experience, particularly in the low-level design (LLD) curriculum. Additionally, several other colleagues from Pepcoding have been hired as full-time employees at Scaler. 

Abhimanyu Saxena, co-founder of Scaler, emphasized the importance of their diverse talent pool and industry expertise in accelerating Scaler's pursuit of its vision and mission.

Unlocking the Potential of India's Talent

Sumeet Malik, in discussing the acquisition, emphasized the shared commitment between Scaler and Pepcoding to the success of their students. Both companies believe that India possesses abundant raw talent capable of building products and companies that can rival industry giants like Google, Microsoft, and Uber. Malik emphasized the importance of providing the right guidance and access to opportunities to unleash this potential.

Scaler's strong financial backing from renowned global investors such as Sequoia Capital India, Tiger Worldwide, and Lightrock India has provided the necessary support for its expansion in both the Indian and American markets. The company's strategic acquisitions and partnerships, combined with its commitment to student success and upskilling, position it as a leading player in the fast-growing edtech space.

What Are The Current Challenges in the Edtech Sector?

The edtech sector has faced challenges due to the reopening of educational institutions after the pandemic-related disruptions. Many edtech startups, including several unicorns, have been forced to downsize their workforce to cut costs. Last year, over 8,000 employees in the edtech segment were affected by layoffs. Prominent edtech companies such as Byju's, Unacademy, and Vedantu have also experienced employee reductions.

Overall, the edtech sector in India continues to hold promise and attract significant investments.