Photo by Abhishek Rai on Unsplash
Over the past year, more than fifty Indian EdTech companies have raised fresh capital. The deal sizes are smaller than in earlier cycles, but they are spread across a more diverse set of sub-sectors. The pattern reveals a sector not retreating but reorganising — shifting from broad consumer platforms to sharper, more focused plays across the learning and education value chain.
We evaluated funding rounds of companies over the past 12 months to recapture where the money flows.
Early-Stage Experiments Take Centre Stage
Source: Tracxn
Most of the fundraising activity is concentrated at the seed and early Series A stages. Transactions in the $0.5–2M range are backing ideas that are narrower in scope but sharper in focus: AI tutoring (ZuAI), gamified learning (Bhanzu, Matiks), teacher training (Suraasa, Toddle), and creative learning (Vobble, Bambinos, Kalakaram).
Instead of building catch-all platforms, today’s founders are targeting specific pain points with leaner models. Investors, in turn, are placing multiple small bets across a wide field of experiments.
However, an important placeholder here is that most of the capital (in volume) is mobilised towards larger companies such as PW, upGrad, and Eruditus.
Education Finance Becomes Core Infrastructure
A distinct cluster of capital is flowing into education-fintech players like Auxilo, Eduvanz, Propelld, and GyanDhan. These companies are building the credit infrastructure that underpins access to education — student loans, tuition financing, and study-abroad funding.
For families, these platforms are increasingly critical enablers of opportunity. For investors, they are attractive because revenues are linked to repayment streams, not consumer churn. This positions education-fintech as one of the more durable themes within the sector.
Debt Rises as a Mainstream Funding Tool
Source: Tracxn
Several of the year’s largest transactions were debt raises: Leap ($100M), Auxilo ($57M), CollegeDekho’s financing facility. Equity remains important, but debt has become a deliberate option for companies with predictable cashflows and recurring revenue.
This trend indicates a maturing sector. Founders are tapping non-dilutive capital to manage growth without resetting valuations, while investors view debt as a lower-risk way to stay exposed to the sector’s trajectory.
The contrast with broad-based K-12 apps is stark: consumer learning solutions have softened, while career-linked platforms have become more compelling bets.
Where Capital Is Not Flowing
Just as important as what is being funded is what is being left out. The data shows little activity in:
Large-scale B2C K-12 apps, once the dominant story, now absent from recent roundsGeneric test-prep platforms, unless tied to specific government or regional nichesContent marketplaces offering broad, undifferentiated video courses
These models face challenges of high acquisition cost, low retention, and limited differentiation, making them less attractive in the current funding environment.
Where Capital May Flow Next
Looking forward, two themes stand out as likely to attract more attention from investors:
B2I Platforms (Business-to-Institution).
Solutions that help universities and colleges update curriculum, integrate AI, and link learning to employability are gaining visibility. These models are:
Priced institutionallyAlign with the needs of admissions cyclesAddress the growing demand for industry-ready graduatesEnjoy robust economicsNeed capital for working capital management and growth
Study Abroad Ecosystem.
Student demand for international education remains robust. Financing, advisory, and admissions platforms are well positioned to benefit, as seen in early rounds for players like ForeignAdmits and Leap. The structural drivers — aspirations for global education and the need for financial access — remain strong. And as students look for alternatives in the globally evolving macros, study abroad will attract capital to:
Build global teams for relationship management with institutionsPhysical centres for advising students face to faceCreate full-stack solutions focused on solving problems across the value chain (admissions, counsellling, financing, accomodation)
A Sector Realigning
The evidence from the past twelve months is clear: Indian EdTech is not shrinking but realigning. Investors are rewarding smaller, sharper innovations, financial infrastructure, debt-linked growth, and career-oriented models. They are avoiding broad, high-burn platforms without clear outcomes.
Looking ahead, B2I platforms, the study-abroad ecosystem, and AI-enabled solutions are set to define the next chapter. The sector is moving towards diversity and specialisation — less about a handful of category leaders, more about a network of focused companies solving distinct problems across the education journey.
LoEstro Advisors is an investment banking firm specializing in sell-side fundraising and M&A advisory, along with a strong consulting arm. Recognized as the #1 financial advisor in education in India, we are the advisor of choice to India’s blue-chip education businesses.
Over the last four years, we have grown to be one of India’s largest (in terms of M&A transactions) homegrown boutique investment banks, with $1.2bn+ worth of combined deals closed across education, healthcare, consumer, and technology sectors.
