Morgan Stanley PE, BanyanTree inject $75m in edtech startup Nspira

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Education services company Nspira Management Services on Wednesday announced that it has raised $75 million from Morgan Stanley Private Equity and BanyanTree Growth Capital II.

The fund infusion includes a $67-million investment from a fund managed by Morgan Stanley Private Equity Asia for a minority stake, the company said in a statement. The proceeds will be used by Hyderabad-based Nspira for its organic and inorganic growth plans, it added.

“We will be deploying the funds to scale our business geographically, increase our client base, develop cutting-edge education products, modernise our facilities and scale up our digital business,” said Nspira managing director Puneet Kothapa.

“We will also opportunistically evaluate inorganic opportunities that are synergistic with our core business and help us diversify our offerings,” he added.

This is the second round of fundraising for Nspira after it raised $60-million structured debt in January 2016 from Olympus Capital Asia Credit and CX Partners.

Launched in 2013, Nspira provides end-to-end solutions in the education space, including staffing, organizational development interventions, IT infrastructure, sales and marketing, facilities management, as well as the entire administrative function. It also offers coaching services to crack medical and engineering competitive examinations.

The startup claims to offer its services to over 500 educational institutions with a student base of close to 400,000 across 13 states.

“We believe private education in India is poised for a strong growth phase, driven by the large demand-supply gap for quality education as well as by increasing disposable incomes and urbanisation,” Nirav Mehta, MD of Morgan Stanley Private Equity Asia in India, said.

Other funding deals in the edtech space include US-based Unreasonable Capital’s recent investment into education tech company Stones2Milestones, iNurture Education Solutions Pvt. Ltd’s Rs 28 crore ($4.4 million) funding round led by Ventureast in February, and AEON Learning’s $3.2-million funding from MEMG Family Office, a fund by Rajan Pai, chairman of Manipal Education and Medical Group, in January.

Last year, Byju’s, which is run by Think and Learn Pvt Ltd, had raised an undisclosed amount of funding in a fresh round from China’s internet giant Tencent Holdings Ltd to accelerate product development for new markets and enable growth through acquisitions.

Anand Rathi acted as the sole financial advisor to Nspira for the latest transaction.