New Delhi: Edtech company Unacademy will shut down its company-run offline centres and move fully to a franchise model over the next few months, founder Gaurav Munjal told employees in an internal email. The decision comes shortly after acquisition talks between Unacademy and upGrad collapsed due to disagreements over valuation and deal structure.

With that deal off the table, Unacademy is now planning its next phase on its own while continuing internal restructuring. In the email, accessed by Moneycontrol, Munjal said Unacademy will convert all its company-operated offline centres into franchise-run centres. Under this setup, local partners will manage daily operations, while Unacademy will handle academics, technology, curriculum and branding.

What Munjal said in the email

“Over the coming months, we will exit our company-operated centre business by converting them into franchise partnerships,” Munjal wrote. He added that the model has already shown positive results. According to him, this approach helps Unacademy stay asset-light and reduce costs while focusing on its main strength, which is online education products.

The transition is expected to be completed by April. After that, Unacademy will no longer directly run any offline centres. Munjal said this change will improve the company’s cost structure, as franchise partners will take care of operational expenses.

“Unacademy has always been exceptional at one thing: building great online learning products. So we are going back to our strengths. Unacademy will be an online-first company moving forth, like it was when we started in 2015,” a company spokesperson told Moneycontrol.

Cost changes at Unacademy

Munjal also spoke about cost cuts made over the past year. Unacademy reduced its test-prep losses from around Rs 450 crore in CY2024 to about Rs 200 crore. This was done by shutting down weak businesses and focusing on areas that were performing better. Several of Unacademy’s main businesses are now making money at the contribution level. 

UPSC, NEET PG, CAT and other test-prep segments have turned contribution-margin positive. PrepLadder and Graphy were cash-flow positive throughout the year. Meanwhile, language-learning platform Airlearn grew from about $200,000 in annual revenue at the start of 2025 to nearly $3 million by the end of the year.

Leadership changes and current financial position

The announcement follows recent leadership changes at the company. Earlier this year, Munjal and co-founder Roman Saini stepped away from daily operations. Co-founder Sumit Jain was appointed CEO of Unacademy’s core test-prep business.

Unacademy currently has around Rs 1,100 crore in cash, according to earlier Moneycontrol reports. The company is expected to finalise its future plans as it completes the shift away from running offline centres itself. “We know what we are good at. We know where we are going. And now, with the right structure in place, we get to do what builders love most: grow,” in a mail Manjul wrote.