SoftBank-backed EdTech giant Unacademy has announced a major strategic pivot. In a bid to cut costs and reinforce its "online-first" DNA, the company will shut down all its company-operated offline centers and transition completely to a Franchise Partnership Model.
CEO Gaurav Munjal confirmed that the shift will be completed by April 2026. This decision comes shortly after merger talks with rival upGrad fell through, signaling Unacademy's intent to pursue a standalone, profitable path.
FounderStory Intelligence
Why the Shift? The "Asset-Heavy" Trap
In 2022-23, EdTech giants rushed to open physical centers (following the "Hybrid" hype). However, managing real estate, staff, and overheads for hundreds of centers proved to be a massive cash drain.
By moving to a Franchise Model, Unacademy shifts the CAPEX (Capital Expenditure) and operational risk to partners, while retaining revenue through royalties and brand licensing. This "Asset-Light" approach is designed to be capital-efficient, allowing the company to focus on content and technology.
Financial Turnaround
Munjal highlighted significant improvements in financial health. The company's annual burn rate has been slashed by over 50%—from ₹450 crore in 2024 to ₹200 crore in 2025.
Key verticals like UPSC, NEET PG, and CAT have turned contribution-margin positive, meaning they are profitable on a per-unit basis before corporate overheads. Additionally, subsidiaries PrepLadder and Graphy are now cash-flow positive.
"The shift will be completed by April... described the franchise model as asset-light and capital-efficient."
FounderStory Takeaway
Unacademy's pivot is a tacit admission that "Phygital" is hard to scale profitably on your own balance sheet. The future of EdTech seems to be a split: Online for scale, and Franchises for physical presence. With Airlearn gaining traction globally, Unacademy is potentially looking at international markets to fuel its next phase of growth, moving beyond the saturated Indian test-prep market.