Tech Upskilling Start-up Scaler Completes $55-million Funding

Scaler (by InterviewBit), one of the fastest-growing tech upskilling startups, said it has done the successful completion of Series B funding of $55 million led by new investor Lightrock India along with two existing investors, Sequoia Capital India and Tiger Global. With this fresh round of funding, the total capital raised by Scaler Academy since January 2020 stands at $76.5 million with a valuation of $710 million.

The entry of Lightrock India into the Scaler family as a new strategic partner will help accelerate the brand’s ambition to disrupt India’s formal higher education sector. This comprises universities and colleges that are unable to meet the growing demand for the new kind of skilled workforce for the country’s $200 billion IT sector. The fresh round of funding will also allow Scaler to aggressively pursue its international expansion plans, launch new product offerings and business verticals. The funding would also help the firm make strategic acquisitions, invest in best-in-class talent, and grow its customer base in India and globally.

“The failure of legacy institutions in India’s higher education sector, particularly in the IT space, has opened up opportunities for avowed status-quo disruptors like Scaler to push a new kind of thinking that looks beyond cost arbitrage-based success,” said Abhimanyu Saxena, co-founder, Scaler and InterviewBit. “Technologies like machine learning and data science will create a new kind of India powered by communication technologies like 5G that will have a far-reaching impact on the country’s socio-economic status. We are creating the skilling ecosystem that will ensure that we succeed by creating a future-ready India. We decided to go with Lightrock India and our existing investors (Sequoia Capital India and Tiger Global), who share our vision of what we are trying to do at Scaler.”

The higher education ecosystem is fragmented and deeply broken. There is an acutely inequitable ecosystem where the top 15 per cent of colleges drive millions to attempt an array of entrance examinations, whilst the bottom 85 per cent have limited accountability. On top of that, the top 15 per cent cater to those who can afford $11,000 or more, further restricting the country’s ability to build a robust talent pipeline for the future. Therefore, higher education must shift from learning to skilling, from poor accountability to employability and from physical communities to digital tribes.

“The team at Scaler Academy (and InterviewBit) are transforming higher education in India by democratising the privilege of working in technology for millions of Indians,” said Divya Venkatavaraghavan, principal investor, Lightrock India. “They are building a learning community that is accountable for outcomes and designed for the future of work. We are privileged to partner with them on this exceptional journey as they help unlock the demographic dividend of India.”

Shailendra J. Singh, managing director, Sequoia Capital (India) Singapore, said the most distinctive part of Scaler’s strategy is that they are super focused on extremely high-quality computer science education, delivered with their own unique approach. This makes their programs practical and useful in the work environment. “This is resulting in outstanding student NPS (net promoter score) and exceptional job placements for Scaler students,” said Singh.

John Curtius, partner at Tiger Global, said, as an experienced investor in India’s startup ecosystem, Tiger Global is particularly bullish about the country’s edtech companies.

“Scaler’s relatively young age (since April 2019) is more than made up for by the vision and maturity of its founders and the 800-plus-member team that is on a mission to disrupt India’s tech education space,” said Curtius. “We could not be more excited to double down on our investment in Scaler and continue to support the team.”

Scaler’s success in the last two and half years is highlighted by the fact that nearly 7 out of every 10 startup unicorns in India now has a Scaler alumni. “We have over 380 alumni in just these 9 companies alone - Microsoft, Google, Uber, Amazon, Paypal, Adobe, VMWare, Intuit, Mcafee. The cumulative annual salary of Scaler graduates is more than Rs 600 crore as of today,” said Saxena of Scaler. “If you factor in our expenses on teaching and infra, Scaler enables the addition of more than $100 million into India’s economy every year. Our next goal will be enabling the addition of a $1 billion India’s GDP annually.”

The largest tech giants in the world are headed by Indian-origin CEOs. India has evolved from being the de-facto outsourcing and back-office hub of the world to emerging as the proverbial melting pot for churning out the finest tech talent. And yet, for far too long, poor employability has plagued India’s employers – for, e.g. less than 1.5 per cent of engineering students from IT branches can correctly compile code. Employability for mechanical and civil engineers was about 6 per cent, while it was as low as 1.7 per cent for chemical engineering. In light of this, Scaler said its full-stack learning platform is truly democratising privilege by creating an online, socially woven community of tech talent, engaged through constant skilling and retained through career advancement.