Unacademy pitched a SaaS tool called Cohesive to rivals while laying off 1,000

Unacademy is India's online test-prep giant, valued at $3.4 billion in August 2021, hunting for new revenue lines as the edtech boom reversed.

An edtech giant can sell its internal engineering tooling as SaaS — and SaaS multiples can replace the venture money that stopped coming.

After multiple acquisitions and business models, Unacademy ventured into SaaS, pitching Cohesive to companies even as it laid off nearly 1,000 people — including 150 from sales and operations in one June 2022 week.

Industry estimates pegged Cohesive's annual recurring revenue at about $500,000, which The Ken reported might support a bridge round of around $10 million at most. Unacademy hoped Cohesive could be its attempt at building an AWS, but questions around product-market fit and future viability deterred potential customers. The company even pitched the service to Byju's, its $22 billion rival and the world's biggest edtech.

SaaS was a fundraising story as much as a business: with no fresh capital since August 2021, a 20-30x-multiple sector offered a way back to growth the core product could not fund.

Product-market fit was unresolved — the customers being pitched had little reason to buy infrastructure tooling from an edtech company.

The timing cut both ways: layoffs of the sales and operations teams assigned to sell the new product weakened the very motion Cohesive needed.

A SaaS line is a valuation story until it has customers who would exist without the parent's brand — internal tooling only becomes a product when outsiders pay at list price.

As of The Ken's June 20, 2022 report, Cohesive remained in market with an estimated $500,000 ARR, and Unacademy's layoffs and fundraising hunt continued. The material does not record the product's later fate.