Binny Bansal-Backed PlanetSpark Adapts to Edtech Challenges by Upskilling Office Workers

PlanetSpark, supported by Binny Bansal, is shifting its focus from just school students to include working professionals as the demand for upskilling continues to grow. This move is part of the company’s strategy to navigate through tough times in the Indian edtech sector, especially for K-12 education.

Kunal Malik, co-founder of PlanetSpark, mentioned that the demand for training office workers is increasing rapidly. The company had previously raised $13.5 million from notable investors, including Bansal, in December 2021, when vocational courses were in high demand. However, as funding decreased post-pandemic and students returned to traditional schooling, many edtech companies faced challenges. While some vocational training startups struggled, others focused on upskilling, like Eruditus and UpGrad, have managed to thrive.

Founded in 2017 by Malik and Manish Dhooper, PlanetSpark initially provided live classes for public speaking and creative writing to K-8 students. Now, students in grades 9 to 12 and working professionals account for about 30% of its revenue.

Cost-Cutting and New Strategies

To adapt, PlanetSpark has made significant cuts to its administrative expenses, reducing costs related to software vendors by nearly 80%. The company now develops many of its systems in-house, which has helped improve its financial situation. In FY23, PlanetSpark increased its product development budget from 7% to 15% of its revenue.

After facing massive losses in FY22, the company has managed to reduce its losses by 40% in FY24, with a revenue increase of 60% compared to the previous year.

During the pandemic, PlanetSpark’s monthly revenue soared from ₹7 lakh to ₹7 crore, but this growth led to higher losses. Malik emphasized the need to fix their unit economics for long-term sustainability.

Looking Ahead

Malik aims for PlanetSpark to achieve profitability by the end of FY25. “We’ve been profitable on a monthly basis since April 2024. Our goal is to end this year in the green,” he stated.

The edtech sector has seen many ups and downs over the past several years, leading some companies to shut down or pivot their business models. An investor noted that many edtech companies face challenges converting free users into paying subscribers, often resulting in companies shifting to an enterprise-focused model to reduce customer acquisition costs.