Edtech platform Doubtnut, reportedly cut its staff amid potential acquisition talks over the last year.
The Co-Founder of Doubtnut, Tanushree Nagori, admitted a reduction in the personnel, although she stated that this was done more than six months ago. She refuted the acquisition rumours.
“There haven’t been no layoffs in the last two quarters,” Nagori said, adding that there haven’t been any acquisition-related discussions either in the previous 6 to 8 months.
The Gurugram-based startup had difficulty securing new capital, has looked into takeover opportunities with several businesses, and has had to downsize its employees by 30–40%. The report also stated that potential acquirers were uninterested in the edtech platform because of high burn and poor revenue.
According to Nagori, Doubtnut’s monthly burn decreased by more than 80% to Rs 2.2 crore in March 2023 from Rs 10.6 crore the year before. According to her, the company reported sales of Rs 27.6 crore in FY23, an increase of almost 50% from the year before.
According to the company’s annual financial accounts filed with the Registrar of Companies, the edtech company had revenues of Rs 15.2 crore and losses of Rs 179.2 crore in FY22. Its overall expenditures for FY22 came to Rs 194.4 crore, which included Rs 72.4 crore in employee benefits—or Rs 6 crore each month.
According to the study, the company’s monthly burn for employee perks has dropped by more than 80% to a little under Rs 1 crore, signaling a fall in the workforce. In the previous six to eight months, the company had also shut down its banking, SSC, and other public commission preparation verticals.
The company hopes to break even in the next 10-12 months and has decided to focus on fewer categories to be profitable, Nagori said. “But on that path to be profitable, we may have decided to take a small break on a few categories.”
Doubtnut has raised a total funding of $49.9 million over six rounds, including $30.8 million in a Series B round in January 2021 from SIG Venture Capital, Sequoia Capital, and others, according to Tracxn. The edtech platform has raised $2.5 million through convertible notes in a funding round from existing investors, Nagori said, adding that the investors are “supporting us for runway that we need until we break even”.
Doubtnut, a company founded in 2016 by IIT Delhi alumni Tanushree Nagori and Aditya Shankar, provides students with immediate access to video answers to their problems. After a time of intense pandemic-driven boom, the edtech industry has been in disarray. The pandemic provided positive development factors, but the return of traditional classroom settings and a funding freeze have severely hurt ed-tech companies.
