Indonesian education technology (edtech) startup Ruangguru has closed its Series B funding round, according to three people aware of the development.
The company is learnt to have raised around $7-8 million through the funding round to fuel its expansion plans, according to people in the know. Although the company did not comment nor confirm on closing their series B funding, industry experts predict that Ruangguru has roped in an international investor for its Series B round, given the lack of local series B investors in Indonesia.
The company had earlier confirmed to DEALSTREETASIA that it was in discussions to raise funding. In an emailed response, it said: “It is true that we are raising Series B but the amount stated is pure speculation. At this moment, unfortunately, we cannot mention any investor that we have been talking to and the stage of the discussion.”
In May, the company announced that it has secured an undisclosed grant from GSMA Ecosystem Accelerator Fund, a startup grant programme of global mobile operator trade body GSMA. The company was going to use the new funding to launch its mobile-based marketplace for personalised private tutors, which will include a feature for tutors to create and share content. The content will be accessible for students on freemium basis.
Ruangguru had raised a seven-digit Series A in December 2015 led by Venturra Capital, a VC firm focused on early-stage tech companies in Southeast Asia. East Ventures had led the startup’s seed round in 2014.
With significant quality gaps in education systems across Asia, startups in the region have an opportunity to truly disrupt the space using technology. Finding a business model that works could be challenging though. Industry observers believe that education has ample opportunity, even though business models are unclear. For instance, even if you do improve quality of teachers, how do you monetise it? While a lot of people are thinking about it, there is a dearth of good business models in Southeast Asia, thus making it an extremely attractive sector, according to many investors.
Recently, India’s education technology startup Byju’s, which is backed by the Chan Zuckerberg Initiative (CZI), was announced a Harvard case study.This was India’s fourth startup, and one of the first start ups in the education tech field to be featured in this list. Byju, later also received an undisclosed investment from World Bank’s International Finance Corporation too.This is a clear indicator of the growing investor interest in this new sector, and its promising future.
Among other notable investments in the education space in Asia, Pearson had injected $2.2 million in Indonesian online education service HarukaEdu through its Pearson Affordable Learning Fund in late 2016. Similarly, Gray Matters Capital recently invested an undisclosed amount in India-based Liqvid English Edge.
Other education-focused investors include India-based impact investor Aavishkaar, which has funded companies such as Butterfly Fields and Little Laureates, and 500 Startups, whose portfolio companies include Kidblog, Chalkable, MindSnacks, Magoosh, Motion Math, Storypanda, and Timbuktu.