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Investing in Yellow Class

Developing the largest global online extracurricular learning community for children

Published
17th August 2021
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Yellow Class

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3 mins

In today’s age of rapid technological disruption and a world where careers are transforming at an ever-increasing pace, the school curriculum is inadequate to prepare students for the future. The rise of the passion and internet economy has opened a plethora of career options for children today. Since the school curriculum and infrastructure do not focus enough on holistic child development, parents are keen on finding alternative and easily accessible options to encourage hobbies and develop skills among their children.

In recent years, the extra-curricular segment in India has grown steadily and is expected to reach a size of $5.8 Bn in 2021. Currently, this is a fragmented market mostly catered to by smaller localized players without any structure or standardization in quality. As parents need to manage their work and home lives, travelling long distances for a class is also a major inconvenience and limits the options to neighbourhood classes. This problem is further compounded in Tier 2+ cities where many of these activities are not available. 

Another major concern among parents is the rapid increase in screen time for children. Currently, more than 100 million children (below 13 years’) in India spend over 100 hours on YouTube and similar platforms every month passively binging on videos thus impacting their overall development. During the pandemic, the screen time increased ~100% for children—almost 54% of parents stated that their children had spent an additional 5 hours on screens.

Yellow Class is an online extracurricular learning platform for children in the 3-12 years’ age group, across 40+ categories including art, craft, dance, yoga, general knowledge and logical reasoning, to create a fun, learning destination. Classes are delivered in a large-class format with as many as 10,000 kids attending a class at the same time. Chatbots, polls, quizzes and social nudges form the gamified AI layer that makes the class engaging and fun.


Its unique model of livestreaming classes and building interactivity through gamification facilitates learning at scale, thus fundamentally breaking the conventional constraint of teacher-student ratio imposed otherwise in small group classes. This enables the platform to rapidly generate high-quality content across a diverse range of activities at low cost thus characterizing an edtech “product” that can scale to a much larger base of users with much lesser increase in cost. Yellow Class’ wide range of activities ensures that even if a child loses interest in a particular activity, they can explore other activities on the platform, which leads to high retention.

Team

As parents of young children, both Anshul and Arpit witnessed the tectonic shift in the adoption of online learning during the pandemic lockdown and personally felt the gap in the extracurricular learning space. They started with small experiments on Zoom and, within six months, they had built a successful product with 200K+ active users. The inclination of proud parents to share their child’s creations among their social circles has led to the viral growth of Yellow Class. Such strong word of mouth marketing led to the platform’s massive 18X growth in the last six months. With low acquisition costs, zero marginal costs for additional users and high retention, Yellow Class is out to build the largest global community for extracurricular learning for children.

The value of the platform out was evident in the pure delight observed in each of our customer conversations. We have been interacting with the team since inception and were pleasantly surprised each time by the depth of their consumer insights and thought process. Anshul and Arpit had previously started and led multiple startups in the face of odds showcasing their grit and resilience as founders. We are thrilled to lead Yellow Class’ Series A investment as they set out on the mission to democratize holistic learning.

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