Chennai-based edtech firm, Veranda Learning Solutions is planning to set up around 1,250 offline hybrid centres to offer high-end, industry-focussed software education programs to over five lakh students annually across the country.
“We are planning to establish a network of around 1,200-1,250 centres in India with each centre producing around 400 IT industry-ready students annually over the next 2-3 years. We are building the capacity to offer it through our offline hybrid format,” Kalpathi Suresh, Executive Director Cum Chairman, Veranda, told BusinessLine.
In September last year, Veranda Learning acquired Bengaluru-based Edureka, an online upskilling platform for working professionals in the IT industry. Veranda has since been working on transforming Edureka from a pure-play online platform to an offline hybrid upskilling platform with a pan-India presence.
“We have already soft launched the first set of such offline hybrid centres. We currently have over 20 such centres already signed and paid up. We expect it to gain significant momentum as we move forward,” Suresh added.
Bridging skill gap
Highlighting a NASSCOM study, which put the gap between demand and supply of digital talent at six million, Suresh said, on one side there is the issue of high attrition and talent war that is saddling the IT industry while on the other side, there is a serious skill gap due to unaffordability of education programs, especially for people in smaller towns.
“If the skill gap has to be bridged, we need to leverage and harness the people from Tier 2,3 and 4 cities. Our aim is to offer these programs at affordable costs to the real (rural) India,” Suresh added.
Veranda is planning to roll out these offline hybrid centres through a franchise model. When asked if it is possible to offer software upskilling courses at affordable price points, Suresh said that it can be a win-win for both Veranda as well as franchisees even after offering the courses at reasonable costs.
“At ₹25,000 per student each centre would produce about 400 students every year, which is about a crore of rupees in revenue. At about 1,250 centres, it works out to ₹1,250 crore of topline. A partner typically makes ₹15-20 lakh as investment for a centre. We charge 25 per cent for Royalty and 15 per cent for giving them access to our entire lab on the cloud. So out of ₹1 crore, we retain ₹40 lakh and our partner takes ₹60-lakh with ₹15-20 lakh as profit,” Suresh said. adding “This means an internal rate of return (IRR) of 100 per cent.”
Veranda raised ₹200 crore via its public issue last month. The company had then said it will use ₹60 crore for debt repayment, ₹25 crore for the settlement of the acquisition cost of Edureka or repay the bridge loan taken for it, ₹50 crore towards growth initiatives and ₹65 crore for general corporate purpose.
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