India's EdTech Sector Rebounds as VC Activity Regains Momentum
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India's EdTech ecosystem has swung back into focus for venture capitalists, steadily emerging from a funding winter with recalibrated emphasis on resilience, scalability, and profitability.
A joint IAMAI–Grant Thornton Bharat report estimates the sector's value is projected to grow at 25.8 per cent CAGR, reaching nearly USD 29 billion by 2030. It further estimates that EdTech's share of India's GDP will quadruple, from 0.1 per cent in 2020 to approximately 0.4 per cent by 2029.
HolonIQ further notes global EdTech funding dropped to USD 2.4 billion, its lowest since 2014, with early‑stage deals rising modestly while megadeals shrank sharply.
Although overall funding remained constrained, marquee investments helped reshape expectations: Physics Wallah, valued at approximately USD 2.8B, raised a USD 210 million round in early 2025 and subsequently received SEBI approval to raise INR 4,000 crore (~USD 480 million ) via IPO.
GyanDhan, an education-financing startup, secured INR 50 crore (~USD 6 million) in mid‑2025 from Classplus and Pravega Ventures, highlighting growing VC interest in financial access models beyond direct learning platforms.
Broader VC sentiment remains cautious yet optimistic: Bain & Company's India VC Report 2025 reported a recovery in overall VC investment to USD 13.7 billion in 2024, with early- and mid-stage deal volumes rising 45 per cent year-on-year alongside a rebound in mega-rounds, albeit at more conservative valuations.
India's fast‑growing demand for upskilling, K‑12 hybrid delivery, and regionally localized content is reshaping investment flows. Meanwhile, education-financing startups such as GyanDhan are drawing VC dollars, signaling broader interest in ecosystem playbooks beyond traditional tuition models.
Manish Agarwal, Senior Director, PrepInsta, said that India's EdTech industry is at an exciting crossroads. With increasing smartphone penetration, affordable internet, and rising demand for upskilling, the future will be defined by how well we integrate emerging technologies into education.
"AI and personalised learning are at the forefront. Educational platforms are increasingly adopting AI to create custom learning paths based on individual progress, aptitude, and career interests. This allows for more effective learning and better engagement," said Agarwal.
"Gamification and immersive tech like Augmented Reality AR and Virtual Reality VR are likely to play a larger role. These tools can create hands-on learning experiences that simulate real-world applications, especially useful for areas like coding, engineering, and soft skills training. Imagine students practising coding or aptitude in a virtual environment that feels like a real job simulation—this can bridge the gap between learning and industry needs," added Agarwal.
A recent IAMAI survey found 94 per cent of teachers and 69 per cent of parents believe EdTech is bridging geographical education divides.
India's education-innovation infrastructure is also expanding: as of early 2025, 10,000 Atal Tinkering Labs and 72 Atal Incubation Centres have been established across schools and institutions, seeding grassroots innovation (many in EdTech), mentorship and entrepreneurship networks.
With key IPOs (like Physics Wallah) in progress, the coming quarters may signal a broader late‑stage capital revival. Bain & Company notes, India's VC landscape is heating up again, riding on improved macro conditions and the maturation of high-profile assets.
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