India’s edtech sector may be entering a fresh consolidation phase as large platforms seek scale and sustainable growth after the post-pandemic funding slowdown, industry executives and investors said.
upGrad–Unacademy deal signals potential consolidation wave
The shift comes as upGrad has signed a term sheet to acquire rival Unacademy in a 100% share-swap transaction, signalling what could become one of the biggest consolidation moves in the country’s online education space in recent years.
Unacademy has raised about $854.3 million across 13 funding rounds, according to PitchBook, and counts SoftBank, Tiger Global Management, General Atlantic, and Peak XV Partners among its backers, while UpGrad has raised $329 million across 8 rounds, according to Tracxn.
For upGrad, founded by Ronnie Screwvala, the acquisition could significantly broaden its user base beyond higher education and professional upskilling into the K-12 and test-preparation segments, where Unacademy has built a large audience.
“A lot of capital flowed into edtech during the Covid years, but in many cases the sector struggled to demonstrate durable learning outcomes,” said Sunitha Viswanathan, partner at Kae Capital. “As a result, investors have been more cautious post Covid.”
Investors see shift toward scale and profitability
Industry investors say the potential deal also reflects a broader shift in the sector, where companies are focusing on profitability and scale after years of aggressive expansion fuelled by venture capital.
Ujwal Sutaria, founder and general partner at TDV Partners, said the move could help upGrad build a full-cycle learning platform.
“For upGrad, this is a bid to build a cradle-to-career platform,” Sutaria said. “The company has traditionally focused on higher education and professional upskilling. By acquiring Unacademy, it instantly absorbs a massive K-12 and test-prep audience, creating a pipeline where a learner could enter the ecosystem early and remain within it through their professional journey.”
The deal could also strengthen upGrad’s positioning ahead of a potential public listing in the coming years, investors said, as larger edtech platforms look to build diversified portfolios and stronger revenue streams.
Sutaria added that the transaction also reflects a growing “last man standing” dynamic in the sector. “In a consolidated market, the players with stronger balance sheets can acquire distressed or reset assets at attractive valuations. That allows them to gain scale much faster than building it organically,” he said.
Hybrid learning and AI expected to shape next phase
The potential merger could also accelerate the sector’s pivot toward hybrid learning models that combine offline centres with digital platforms. Both companies have been investing in “phygital” models—blending physical tuition centres with online learning—to improve engagement and outcomes.
At the same time, investors say artificial intelligence could reshape the next phase of growth for edtech startups.
“AI has the potential to fundamentally reshape edtech,” Viswanathan said. “Many of the ideas the sector has long talked about—deeply personalised learning, a one-to-one tutor, or a patient learning coach—are now becoming possible at scale with AI.”
She added that early examples are already emerging. “We are seeing companies building AI-native learning experiences that focus on improving how students actually learn. If implemented well, this shift could translate into measurable improvements in learning outcomes.”
Funding slowdown keeps investors cautious
Still, investors remain cautious after the sector’s boom-and-bust cycle during and after the pandemic.
“One of the reasons investors became wary of edtech is that over time the ‘tech’ often took precedence over the ‘education’,” Viswanathan said. “Going forward, founders will need to keep the learner at the centre of any technological intervention.”
Funding in the sector has already fallen sharply from its 2021 peak, with venture capital firms now backing fewer but larger platforms with clearer paths to profitability.
If the upGrad–Unacademy deal closes, it could signal the start of a broader consolidation wave across India’s edtech ecosystem, as companies look to combine scale, technology and outcomes to win back investor confidence.
Published on March 16, 2026