India’s EdTech sector is moving away from funding-led growth as investment declines, while public listings, acquisitions, offline centres and institutional partnerships reshape business models, according to a Tracxn report.
Annual equity funding fell from about $4.3 billion in 2021 to $214 million in the first eight months of 2026. The number of funded rounds also declined from 368 in 2021 to 36 during the same period.
However, the median round size rose to $1.1 million in 2026, nearly twice the level recorded in earlier years covered by the report. This indicates that fewer companies are raising capital, while those securing funding are receiving larger amounts.
The sector recorded 94 acquisitions and seven public listings between 2021 and 2026. Five of the seven listings took place between July and November 2025, with market capitalisations at IPO ranging from $10 million to $3.6 billion.
Physics Wallah, which raised $275 million, the lowest cumulative funding among the sector’s six most-funded companies, became the only one in that group to go public. Its market capitalisation at its IPO in November 2025 was $3.6 billion.
The report also highlights consolidation among major companies. Unacademy was acquired by upGrad in an all-stock transaction cleared by India’s competition regulator in July 2026. Meanwhile, Think & Learn, the parent company of BYJU’S, has been undergoing insolvency resolution proceedings since July 2024.
K-12 EdTech received 51% of total sector funding between 2021 and 2026, followed by Continued Learning at 26%, Higher Education Tech at 17% and Test Preparation Tech at 15%. Pre-K EdTech accounted for 1%.
Companies are also changing how they deliver education. Physics Wallah operated 353 offline centres across India and the UAE by the end of FY26, compared with 198 a year earlier. Offline enrolments reached about 470,000 students.
Unacademy, meanwhile, converted its company-operated offline centres into franchise partnerships amid funding constraints and its focus on profitability. upGrad and Eruditus have relied on partnerships with universities.
The sector also faces regulatory and competitive changes. India’s Digital Personal Data Protection Rules require full compliance by May 2027, while the government announced free online coaching for competitive examinations in August 2026.
