Mumbai-based edtech startup LEAD School’s net loss declined 18.5% to INR 321.9 Cr in the financial year 2022-23 (FY23) from INR 395.3 Cr in FY22 on strong growth in business and reduction in cash burn.
The WestBridge Capital-backed startup’s operating revenue more than doubled to INR 273.1 Cr in FY23 from INR 132.3 Cr in the previous fiscal year, as per its filing with the Ministry of Corporate Affairs.
The edtech unicorn generates revenue by providing academic solutions, including devices and textbooks to its client schools. It also offers curriculum advisory and support services to schools and pre-schools, parents, and students. LEAD School enables schools to combine technology, curriculum, and pedagogy in an integrated teaching and learning system.
The startup earned a revenue of INR 203.7 Cr through sale of products in FY23, while the remaining operating revenue was generated from sale of services. Including other income, LEAD School’s total income stood at INR 295.5 Cr in FY23, a 107% jump from INR 142.8 Cr in the previous year.
Helped by cost-cutting measures, the startup was able to control the rise in its expenses relative to its business growth during the year under review. Its total expenses increased over 14.7% to INR 617.4 Cr in FY23 from INR 538.1 Cr in FY22.
In a statement, LEAD School said it reduced its cash burn by 60-70% in FY23 compared to the previous year.
Employee benefit expenses continued to be the biggest expenditure for the startup. It spent INR 285.4 Cr on employee expenses in FY23, an increase of 11% from INR 256.4 Cr in FY22.
It must be noted that LEAD School laid off over 160 employees in multiple rounds in FY23.
Besides employee benefit expenses, the startup spent INR 134.8 Cr on procurement of books, teaching aids and devices in FY23, a jump of 40% from INR 95.9 Cr in the previous fiscal year.
The startup also spent INR 137 Cr on ‘other expenses’ in FY23. However, the filing didn’t provide the break up of other expenses.
LEAD School’s advertisement and promotional expenses fell 68% to INR 24.5 Cr in FY23 from INR 76.4 Cr in FY22.
EBITDA margin improved to -104.2% in FY23 from -270.3% in FY22. The startup claimed it is on the path to achieve profitability and become EBITDA positive in FY25.
Founded in 2012 by Sumeet Mehta and Smita Deorah, LEAD claims its integrated system is available to schools in 400+ towns and cities across India, reaching 5 Mn students and empowering over 50,000 teachers.
The startup has raised over $185 Mn till date and counts GSV Ventures and Westbridge Capital among its backers.
Earlier this year, LEAD School acquired London Stock Exchange-listed education group Pearson’s K-12 learning business in India for an undisclosed amount.
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