Hope 50% of our portfolio firms go public in 5 years: GSV Ventures CEO

Michael Moe, founding partner and chief executive officer, GSV Ventures, expects half the firm’s portfolio companies in India to go public in five years. GSV Ventures has invested in Indian edtech players such as PhysicsWallah, Emeritus, AdmitKard, Apna, and Bright Champs. In an interview with Udisha Srivastav on the sidelines of the ASU + GSV & Emeritus summit, he talks of India’s edtech sector and the impact of artificial intelligence (AI). Edited excerpts:

 

Edtech in India has faced the brunt of high valuation. What trends do you foresee in fundraising in 2025?

 

The edtech sector in India — and globally — became overheated in 2021 and early 2022. A lot of capital flowed in, often at extremely high valuations, leading to a necessary market correction. Now things have settled, and we remain bullish on India. We continue to see significant opportunities and expect to be more active in the market.

 

We have invested hundreds of millions of dollars. (In 2025) It would be driven by opportunities. We have stepped up and would like to fund businesses that are growing fast. There are interesting companies we are paying attention to.

 

GSV Ventures was eyeing to ink two deals in 2025. Any update?

 

We haven’t made any official announcements, but we are engaged. You can expect us to make announcements both in the short term and over the coming year.

 

How do you see PhysicsWallah’s decision on its initial public offering and journey?

 

PhysicsWallah has built a successful business in a short period. Its achievements are impressive, but I believe the best is yet to come. It has reached a scale and level of sophistication that position it for significant growth.

 

PhysicsWallah is driven by a commitment to help students succeed in an affordable and scalable way. Its value proposition has been central to its success, and it has been strategic in leveraging technology.

 

How many of your portfolio companies in India are going for an IPO and how do you see IPO milestones? Is it an exit strategy for GSV?

 

Most venture capital-backed companies do not go public — 90-95 per cent are either acquired or they shut down. However, I hope a significantly higher percentage of our portfolio companies go public simply because they can and because it is the best way to maximise their potential. In the next five years, I would like to see at least 50 per cent of our investments go public.

 

If you find a business that can grow at 20-30 per cent for a long time, that is an opportunity to stay invested. Hence, an IPO should not be the closing chapter. It should be the next chapter.

 

Why didn’t you invest in Byju’s?

 

The valuation was incredibly high, and I am more of a fan of growth than getting two cents on valuation. It was not a place where it made sense for us to invest in.

 

What sets the Indian edtech market apart from other markets?

 

Culturally India values education highly. Indian people understand the key to their future is education, which is clear. We have seen the playbook in other countries like China and Singapore, where investment in education and prioritisation of education have paid off in terms of the growth of the country, success, and opportunities.

 

India’s entrepreneurial ambition is remarkable. Over the past 15 years, we have witnessed a dramatic evolution in the startup ecosystem, with more individuals aspiring to become entrepreneurs and gaining experience. In the past, talented and ambitious individuals would have moved to Silicon Valley. That’s no longer the case — India has become a hub of entrepreneurship.

 

So, this is an exciting marketplace from that standpoint. India understands the return on investment in education is extraordinary and encouraging innovation and entrepreneurship in education has a multiplier effect. Right now, India is one of the best places in the world to be a tech entrepreneur

 

How do you foresee the edtech sector evolving in 2025 and beyond, given the increasing impact of AI and technology in education?

 

AI is a disruptive technology. It will be embedded in most education-technology offerings. AI is going to be like air —invisible and ubiquitous — and you will need it to live. It is powerful both from the standpoint of a student’s experience and from the point of view of cost and quality. We are in the early days, but we expect to see that with most companies we invest in.

 

Will AI integration in edtech create more jobs or shall we witness a slump in job creation?

 

You will see both. Ultimately you’re going to see many more (jobs) created rather than getting destroyed. If we look at the history of humankind, technology has enabled more opportunities, not less.