San Francisco and Bengaluru-based overseas education startup Leap’s net loss widened 18.2X to INR 69.1 Cr in the financial year 2021-22 (FY22) from INR 3.8 Cr in previous financial year due to a steep rise in its expenses.

Operating revenue grew 3.7X to INR 23.5 Cr from INR 6.4 Cr in FY21. At INR 20.5 Cr, the startup earned a majority of its revenue from overseas business. On the other hand, its domestic turnover stood at INR 3 Cr.

However, Leap’s expenses grew at a faster pace than revenue. Total expenses surged 9X to INR 92.7 Cr in FY22 from INR 10.2 Cr in the previous fiscal year. 

Other expenses, including rent, advertising, consultancy expenses, ballooned 12.6X to INR 49 Cr from INR 3.9 Cr in FY21. The startup’s advertising expenses rose a whopping 21.4X to INR 32.1 Cr from INR 1.5 Cr in FY21.

Employee benefit expenses rose 6.8X to INR 41.7 Cr in FY22 from INR 6.1 Cr in FY21. The startup spent INR 37.87 Cr on salaries of the employees and remuneration of directors in FY22 as against INR 5.80 Cr in the previous year.

Besides salaries, employee benefit expenses include PF contribution, gratuity expenses, other expenses on staff welfare, among others.

Founded in 2019 by Arnav Kumar and Vaibhav Singh, Leap operates LeapScholar and LeapFinance that help overseas education aspirants plan for studying in foreign countries. Leap’s offering includes counselling services, visa services, credit for overseas education, and other bespoke financial products as well as solutions. 

Last year, Leap raised $75 Mn (INR 585 Cr) through equity financing in its Series D funding round led by Owl Ventures. Leap has raised over $150 Mn to date.

It must be noted that hit by the business slowdown, macroeconomic headwinds and funding winter, loss-marking edtech startups in India have resorted to laying off employees to cut costs. 

As per Inc42’s layoff tracker, edtech startups, including BYJU’S, Vedantu, and Unacademy, have fired over 8,500 employees since 2022. Recently, the leadership team of edtech unicorn Unacademy decided to take up to 25% pay cut for the financial year 2023-24 (FY24).

Among the big edtech startups, Vedantu’s net loss widened to INR 696.2 Cr in FY22 from INR 616.2 Cr in FY21. BYJU’S, which is yet to file its financial statements for FY22, reported a 19.8X increase in its net loss to INR 4,588 Cr in FY21. 

Teachmint reported a 24X surge in its net loss to INR 131.70 Cr in FY22 from INR 5.52 Cr in FY21. 

Amid the recent struggles of edtech startups, Inc42 reported that the founders of top eight platforms received an average salary hike of 46% in FY22 compared to FY21.