Tag: IPO

  • PhysicsWallah becomes first Indian edtech unicorn to go public

    PhysicsWallah becomes first Indian edtech unicorn to go public

    Run by founders Alakh Pandey and Prateek Maheshwari, PhysicsWallah, which became a unicorn after surpassing a USD$1bn valuation, opened its public offering for subscription on November 11, with the bidding closing on November 13.

    The IPO, comprising a Rs 3,100 crore (USD$350m) fresh issue and a Rs 380 crore (USD$42.9m) offer-for-sale (OFS) by Pandey and Maheshwari, raised Rs 1,563 crore (USD$176.4m) from anchor investors at Rs 109 per share, a day before the issue opened.

    PhysicsWallah, known for its digital courses, physical centres, and hybrid programs, with a strong focus on India’s national-level engineering and medical exams as well as government exam prep, views the IPO as a key milestone.

    We plan to open at least 70 centres annually over the next three years, with around Rs 400 crore allocated for this
    Alakh Pandey, PhysicsWallah

    The stock market listing makes PhysicsWallah India’s first pure-play edtech company to go public. Pandey said the IPO proceeds would be largely used to expand offline centres and boost branding.

    “The first major expense after the IPO will be setting up new offline centres. This is our primary focus, as we plan to open at least 70 centres annually over the next three years, with around Rs 400 crore allocated for this,” stated Pandey, during a media briefing with reporters.

    “Another Rs 400 crore will be spent on our existing centres, covering lease and rental expenses. Around Rs 700 crore will go toward branding and event marketing over the next three years, with at least Rs 250 crore each year. Additionally, Rs 200 crore will be allocated for technology upgrade and server costs, and the remaining funds will be used for general expenses.”

    Backed by venture capital firms WestBridge Capital, Hornbill, and GSV Ventures, the company, strong in India’s tier-2 and tier-3 cities, sees the IPO as paving the way for further expansion in Karnataka, Kerala, Tamil Nadu, Gujarat, Odisha, and Northeast India.

    “Physics Wallah is an impactful organisation – from Tier 3 towns to villages, students everywhere are learning through our platform,” said Pandey.

    PhysicsWallah hitting Dalal Street, India’s equivalent of Wall Street and home to the Bombay Stock Exchange (BSE), comes at a time when some of the country’s biggest edtech competitors are seeing their businesses shrink.

    While Byju’s, once the world’s “most valued” edtech startup, is facing takeover bids amid bankruptcy proceedings and lawsuits over “alleged harm to its reputation”, Unacademy has seen a year-on-year decline in total revenue over the past two years, with Upgrad reportedly considering acquiring the company at roughly a tenth of its last valuation of USD$3.44bn.

    Though PhysicsWallah reported a 33% revenue jump to Rs 847 crore (USD$95.5m) in Q1FY26, its net losses widened to Rs 127 crore (USD$14.3m) due to a 39% rise in expenses.

    The company, however, has maintained that its revenue has grown 90% over the past two years and that it maintains a strong cash balance.

    “I want this company to be run with discipline, to grow responsibly, and to make it public in a way that benefits everyone. We are in a hyper-growth phase, and as we expand, we don’t want to slow down or fail to deliver. The IPO will also help us gain more trust and traction with parents.

    “Online education will continue to be our biggest focus – whether it’s a student in Grade 6 or a college or UPSC aspirant. We currently reach 42 lakh (over 4 million) students, mostly in test prep, but we are expanding into school education and board exams. Our aim is to make affordable education accessible across regions,” Pandey added.

    Despite initial optimism, reflected in domestic mutual funds taking up more than half of the allocation – indicating early institutional confidence – the demand in the public issue has remained lukewarm.

    The IPO got off to a slow start, with Day 1 subscription at just 7% and Day 2 improving slightly to 12%, falling well short of market expectations.

    By Day 3, the IPO reached 1.11x overall subscription, with the retail portion at 85%, non-institutional investors (NII) at 25%, qualified institutional buyers (QIBs) at 1.61x, and the employee portion subscribed 2.58x.

    The basis of allotment, which determines how many shares each investor will actually receive, is expected on November 14, with listing likely on November 18.

    Experts suggest that PhysicsWallah’s IPO, which saw muted subscription initially, signals broader caution for India’s edtech sector, which is facing declining market demand and revenue losses, with over 2,000 startups having shut down in the past five years.

    But it’s not just PhysicsWallah. More edtech companies are eyeing the IPO route, including Imarticus Learning, Upgrad, Eruditus, and other education-related firms like Simplilearn and Leverage Edu.

    Just recently, B2B education platform Crizac debuted on the Indian stock market, raising £74m in its IPO, with the listing expected to support the company’s expansion into new markets and services.

    With funding in the edtech space rising five-fold in H1 2025, as per reports, industry insiders expect the next 12-24 months to bring a handful of IPOs.

    “Edtech has gone through its ups and downs and has never been a very predictable sector. There are very few companies that can actually go public successfully,” Nikhil Barshikar, CEO and co-founder of Imarticus Learning, told The Entrepreneur in a recent interview.

    “But now, more companies are focusing on cutting unprofitable or unpredictable business segments. My gut feeling is that in the next 24 months, we will see at least five to 10 listings from the edtech vertical.”

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  • The University of Phoenix IPO

    The University of Phoenix IPO

    Apollo Global Management and Vistria have an offer only a pig would consider: the Phoenix Education Partners IPO.

    Touted by Morgan Stanley, Goldman Sachs, Bank of Montreal, Jefferies, and Apollo Global Securities, the offering of Phoenix Education Partners brings the University of Phoenix (UoPX) back to public markets—but few fans remain in the audience.

    A Decade of Decline: From Expansion to Erosion

    In the early 2000s, UoPX was hailed as a pioneering force in adult education—cozy campuses near freeway exits and an advanced online infrastructure for working learners earned praise. Its founder John Sperling was seen as visionary.

    But by 2010 enrollment had already begun plummeting after reaching nearly 470,000 students, and the school’s academic quality and recruiting ethics were under the microscope. Critics decried “The Matrix,” a perverse scheme where recruiters were aggressively incentivized to push enrollments—no matter the cost.

    By 2018, more than 450 locations had shuttered, enrollment was down by approximately 80%, and half the remaining sites were no longer accepting new students. Even Hawaii, Jersey City, Detroit, and other major cities were on the closure list.

    Regulatory Fallout: Lawsuits, Settlements, and Borrower Defenses

    From the early 2010s onward, UoPX saw an avalanche of legal scrutiny. In 2019, the FTC leveled a $191 million settlement against it for misleading advertising, including deceptive claims about job placement and corporate partnerships.

    By late 2023, 73,740 borrower-defense claims had been filed by former students under federal programs. Many of these were settled under the Sweet v. Cardona class action, with estimates of the university’s potential liability ranging from $200 million to over $1 billion. Meanwhile, nearly one million debtors owed a combined $21.6 billion in student loans—about $22,000 per borrower on average.

    Another flashpoint: UoPX agreed to pay $4.5 million in 2024 to settle investigations by California’s Attorney General over military-targeted recruiting tactics.

    The Ownership Unicorn: Apollo, Vistria, and Political Backing

    After Apollo Global Management and the Vistria Group acquired UoPX in 2016, the school became a commodified unit in a larger private equity portfolio. The deal brought in figures like Marty Nesbitt, a political insider, as chairman—signaling strategic power play as much as financial management.

    Vistria’s broader stable included Risepoint (previously Academic Partnerships), meaning both UoPX and OPM entities were controlled by one private-equity firm—drawing criticism for creating a “for-profit, online-education industrial complex.”

    The IPO Circus: “Pigs on Parade”

    Enter the Phoenix Education Partners IPO, steered onto the market with all the pomp of a carnival but none of the substance. The front-line banks—Morgan Stanley, Goldman Sachs, BMO, Jefferies, Apollo Global Securities—are being paid handsomely to dress up this distressed asset as a growth opportunity.

    But here’s what those colorful floats hide:

    • Collapse, not comeback. Enrollment and campus infrastructure have withered.

    • Debt, not opportunity. Nearly a million debt-laden alumni owe $21.6 billion.

    • Liability, not credibility. Borrower defense claims and state investigations continue to mount.

    • Profit, not public good. Ownership is consolidated in private equity with political access, not academic mission.

    This is a pig in parade attire. Investors are being asked to cheer for ribbon-cutting and banners, while the mud-stained hooves of exploitative business models trudge behind.

    The HEI Verdict

    This IPO isn’t a pivot toward better education—it’s a rebrand of an exploitative legacy. From aggressive recruitment of vulnerable populations (“sandwich moms,” military servicemembers) to mounting legal liabilities, the University of Phoenix remains the same broken system.

    Investors, regulators, and the public must not be dazzled by slick packaging. The real story is one of failed promises, students carrying lifelong debt, and private equity cashing out. In education, as in livestock, parades are meant to show off—just make sure you’re not cheering at the wrong spectacle.

    Sources

    • Higher Education Inquirer. Search: University of Phoenix

    • Higher Education Inquirer. “The Slow-Motion Collapse of America’s Largest University” (2018)

    • Higher Education Inquirer. “University of Phoenix Collapse Kept Quiet” (2019)

    • Higher Education Inquirer. “Fraud Claims Against University of Phoenix” (2023)

    • Higher Education Inquirer. “University of Phoenix Uses ‘Sandwich Moms’ in Recruiting” (2025)

    • Higher Education Inquirer. “What Do the University of Phoenix and Risepoint Have in Common?” (2025)

    • Federal Trade Commission. “FTC Obtains $191 Million Settlement from University of Phoenix” (2019)

    • Sweet v. Cardona Settlement Documents (2022–2023)

    • California Attorney General. “University of Phoenix to Pay $4.5 Million Over Deceptive Military Recruiting” (2024)

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