Flipkart, India’s biggest online retailer, has apparently raised $1 billion in new funds which would make this the biggest ever investment raised by an Indian e-commerce company and one of the biggest rounds of 2014 worldwide.
Given the amount of new investment reported by the Economic Times to be accurate, Flipkart’s total funding raised comes to $1.7 billion at a $5 billion valuation. The official announcement of the round is expected in the coming weeks.
Update: Flipkart confirmed the $1 billion round on July 29th via Twitter.
— Flipkart (@Flipkart) July 29, 2014
This latest Flipkart round has significance for the online education market on multiple levels.
Founded in 2007 by brothers Sachin and Binny Bansal the Bangalore-based company crossed $1 billion in sales in March. Now, Flipkart supposedly felt it was the right moment to raise such a big round in order to cement its position on the subcontinent as its far from being the only company that eyes the lucrative Indian market.
The ubiquitous Amazon launched its India operations last June and already has 25 product categories today.
Tapping into E-Learning
Homegrown competitor Snapdeal announced the launch of an education marketplace in February with the goal to reach its $1 billion turnover target. The company also raised an additional $100 million in new funds in May. According to Kunal Bahl, co-founder of Snapdeal, the online education market in India is expected to reach $3-4 billion in the coming years and that the company plans to make 20% of its revenue from selling services.
The fact that online education is a hot market on the subcontinent gets confirmed by the launch of a dedicated e-learning category on Flipkart this week. The new category enables learners to browse and search for online courses as well as physical products such as CDs or DVDs and test preparation or certificate courses.
The learning itself happens of course through the websites of the respective course providers but the argument of convenience of browsing one website only instead of comparing offers from different websites might actually pay off for Flipkart.
Nipun Mehra, senior director of retail at Flipkart, states
“The availability of eBooks, certificate courses and online tests – all on one platform — will make the entire process of buying/accessing elearning material very easy for students who form a significant part of our customer base today.”
Low Cost Smartphones and Tablets
Another strategy of Flipkart to get the attention of potential customers is to provide them with budget smartphones. Earlier this month the company introduced its own Android smartphones, priced at around $45.
Like the idea behind the Amazon Fire phone and Kindle Fire tablets which encourage its owners to buy even more from Amazon, the Flipkart smartphones as well as the recently launched Flipkart Digiflip Pro XT712 tablet follow a similar concept. Undoubtedly, they are designed and priced affordably to animate even more Indians to shop online and use Flipkart’s different services like the new education marketplace..
It is also worth noting that Flipkart was faster than Amazon, Google and also Mozilla with the launch of a low cost line of smartphones for the subcontinent. It is obvious that nobody in the Android realm wants to miss out on the world’s fastest growing smartphone market.
And again, we can make a conclusion for elearning. As so often, what establishes itself in the general consumer and e-commerce markets will eventually find its way into online education.
Learning on a smartphone is established in Asia for years, and mobile learning is becoming more popular in Europe and the US at a rapid pace.
busuu co-founder and CEO Bernhard Niesner told me in September 2013 that the language learning startup already has more mobile users than web users. At the time busuu had seen more than 30 million downloads of its mobile apps, 62% of which were iOS and 38% Android users. Top countries are the US, Germany and Russia.
Therefore, it is not far-fetched to imagine Indian providers and students alike quickly adopt a mobile strategy for learning when devices come at competitive prices and the content offer is there, too.
Another interesting puzzle piece comes from language learning startup Duolingo which just launched its Test Center offering $20 remote proctored language exams this week. The test center being launched on Android and Google Chrome first clearly indicates that emerging markets like India are of high interest for the startup.
If you are interested in the growing edtech market in India, we created a dedicated channel in which you will find all our coverage of this exciting region.
- India’s biggest online retailer Flipkart sets a new benchmark, raises $1 billion in fresh funds | The Economic Times
- Snapdeal clicks on services space to hit $1bn | Times of India
- Flipkart’s new elearning category makes it as easy to search for courses as it is to find books | Tech in Asia
- Flipkart launches budget smartphones, beats Google and Mozilla to the punch | Tech in Asia