After edtech crash, study-abroad was the bright spot. Now, it faces testing time

“The situation is dicey here,” said Samarth, who is studying for a masters degree. With only a brief window between the end of his internship and the start of the next academic term, he’s worried that even a slight delay in returning could put his visa at risk. “Even if I come back a day late, they might use it as an excuse to cancel my visa,” he said, referring to US President’s Donald Trump regime.

Even when they are travelling within the US, universities are advising international students to carry their passports at all times.

Since Trump returned to power, the US’ immigration policies have become draconian. On 27 May, the administration ordered US embassies around the world to stop scheduling appointments for student visas. It even halted Harvard University’s ability to enroll foreign students. Amid all this, several international students have faced deportation for minor infractions.

While much of the attention around US visa restrictions has focused on students, the Big Brother approach in the US has made another group, India’s study-abroad startups, anxious. Companies such as Leap Scholar, Leverage Edu, AdmitKard and upGrad, which promise smooth overseas admissions and counselling services, are now facing business uncertainty. Because it is not just the US, but key markets such as Canada, the UK, and Australia as well that have tightened rules for international student admissions, according to industry insiders.

After the crash of mainstream edtech in India, the study-abroad industry had emerged as a bright spot. But populist politics across the globe threaten to shake the foundations of the business model. Can these startups weather the storm?

The business

Before 2016, most Indian students seeking to study abroad relied on a highly unorganized network of small, local consultants operating out of single-office setups in Tier I and Tier II cities. About 10 years ago, edtech platforms focused on helping students get admissions abroad started emerging. They include AdmitKard (2016), Leverage Edu (2017), Leap Scholar (2019). Upskilling platform and edtech unicorn upGrad also launched study-abroad services in 2021.

These startups offered a range of services, helping students with university applications and counselling to scholarships, visa applications, accommodation and even loans to finance their education. Each operates with a slightly different proposition—while Leap Finance and Leverage Edu are full-service platforms offering end-to-end guidance and admission support to students, AdmitKard is mostly about counselling. upGrad’s study-abroad programme focuses on hybrid or online-to-offline programmes in which students study online the first year and travel to the university campus the second year.

Over the last few years, India’s study-abroad market has been taking big strides, fuelled by a growing appetite for global education and rising disposable incomes. While the market saw a slump during the covid-19 pandemic years, it has bounced back since. According to Bengaluru-based consulting firm Redseer, about 2 million Indian students are projected to opt for overseas education by 2027. This number, according to the firm, stood at 0.7 million in 2019 and 0.9 million in 2022.

The sector has also seen significant venture capital infusion during and after the pandemic years, 2023 being the year it attracted the highest funding ever, at about $562 million, according to data sourced from Tracxn.

A temporary dip?

Even other top markets, such as the UK, Canada and Australia, have tightened their immigrant rules of late. In May, the UK government released a whitepaper that proposed reducing the standard length of the graduate visa for international students to stay on and work in the UK from two years to 18 months, among other changes.

Last week, Australia-based IDP Education, one of the world’s largest international student placement firms, warned that its full-year revenue and earnings would take a hit due to visa crackdowns in key markets such as Australia and Canada, estimating student placement volumes to drop 28-30% during this financial year. The announcement led to its stock plummeting 50%, it’s worst single-day drop ever,

Canadian study-abroad startup ApplyBoard laid off about 150 employees last week due to policy changes at major study destinations. Last November, Canada ended its Student Direct Stream (SDS) programme, which expedited the processing of study permit applications for international students.

India’s edtech exporters, most of whom rely heavily on the US and UK, are now bracing for the impact of ongoing uncertainty. Industry experts acknowledge that a dip is likely if the situation persists, though they are cautiously optimistic that the downturn will be temporary.

“In our study-abroad business, about 70% of visa appointments were already taken care of. So, those haven’t been affected. But 30% is halted because the visa appointments are on hold,” Praneet Singh, associate vice president of university partnerships at upGrad Abroad, told Mint.

A million students enter the US to study every year, so it impacts the country’s economy as well, Singh noted. “That gives me conviction that it’s not going to last. It’s going to be a couple of weeks or maybe a month or two. But it will eventually get lifted.”

Piyush Bhartiya, co-founder of study-abroad counselling startup AdmitKard, said there is a lot of uncertainty among students planning to go to the US. If their September intake is blocked and interviews don’t open, then US sentiment will go from unsure to negative, he said.

With all the key markets correcting at the same time, there will be some downturn, Bhartiya noted. “The US issued about 80,000 visas last year from India. Now, if that 80,000 falls to 40,000, we don’t know how many markets or how many countries it will take to absorb that other 40,000,” said Bhartiya.

Leap Finance, one of the larger startups in India’s study abroad ecosystem, has refrained from commenting on the subject altogether.

With all the key markets correcting at the same time, there will be some downturn.

— Piyush Bhartiya

With market conditions in flux, investors are closely watching the sector, particularly how these businesses respond and pivot to sustain growth. While recent policy uncertainties in traditional destinations such as the US and UK have sparked some investor caution, the demand for overseas education remains structurally strong, according to Surabhi Sanyukta, vice president–Investments, BlackSoil, an investor in study-abroad platform Leverage Edu.

“The sector has seen consistent double-digit year-on-year growth over the past few years, and this demand is not diminishing; it is simply becoming more geographically distributed,” she said.

“One of the key challenges the sector faces is its historical reliance on a few dominant geographies. Policy shifts, changing visa regimes, and economic volatility in these markets can significantly impact student flows. Startups that scaled primarily on the back of US or UK-bound student demand are now having to recalibrate their strategies,” Sanyukta added.

Expanding horizons

The uncertainty around immigrant laws in various geographies has had a clear impact. Enrolments have gone down by 27% in top destination markets such as the US, the UK and Canada. This decline has affected study-abroad platforms as well, but sparked interest in other destinations.

“If we were getting about 6,000 closed leads in February for Germany, we’re now getting about 9,500 leads a month for that country, which makes for 35% of our business. France has gone from 3% of our business to 8% of our total business at the moment. Finland has also gone from 3% to 6% of our business,” said upGrad’s Singh.

The two really big winners have been Germany and Ireland, which have traditionally seen a smaller intake from India, said AdmitKard’s Bhartiya. “On our platform, we have seen almost five times more inquiries for Germany in the last two years. France and some of the Nordic countries are also gaining interest very rapidly,” he said.

AdmitKard is now focusing on getting accreditations in other countries as the non-US market sees a spike in interest. “We are a very strong recruiter for the US market so we had focused on US accreditation. Now, we are focusing on other countries as well, and onboarding partners in countries like Japan, Finland, and Sweden,” Bhartiya said.

Many prominent schools in the US and UK are setting up offshore campuses in locations such as Dubai and Singapore. Study abroad platforms are now turning to these newer markets, capturing already existing demand and creating new demand.

In the last six months, upGrad has focused on finding partners in Dubai. “We’ve got Middlesex University, University of Birmingham, among others. We’ve just signed up with four schools in the UAE. The company is also trying to double down on Finland and expand to Singapore,” Singh said, noting that India will also see a lot of campuses being set up.

Many prominent schools in the US and UK are setting up offshore campuses in locations such as Dubai and Singapore. Study abroad platforms are now turning to these newer markets.

New Delhi-based Leverage Edu has also seen a sea-change in its student composition over the past 12 months. The company, which relied on India for 100% of its customers, is now seeing 40-45% of students coming from non-India regions—of that, 25% is from Africa, 15% is the rest of South Asia (Nepal, Bangladesh), with the rest from the Middle East and Southeast Asia, Akshay Chaturvedi, founder and CEO of the edtech startup, told Mint.

Chaturvedi added that the UK used to be a dominant study location for the company till about two years back. The country still accounts for 50-60% of the business today, but the remaining 40-50% is mostly from the rest of Europe, particularly Germany, he said.

The way forward

Aside from admissions, most study-abroad platforms make money from test-prep, counselling, documentation, and application fees. These services have stable demand despite the shifts in study markets.

For instance, 25% of Leverage Edu’s business comes from services such as forex and loans, among other ancillaries. Last quarter, the company also launched a job portal, Leverage Careers.com, which the CEO believes will push the income from these non-core services up further.

Value-added services contribute about 10% to Leap’s revenue, with the majority coming from counseling and financing. upGrad’s study-abroad vertical also offers International English Language Testing System (IELTS) prep programmes aside from online-to-offline learning, its core business.

Ashish Bhatia, founder & CEO at India Accelerator, which has invested in edtech companies such as Imarticus Learning, Ingenium and Dhurina, noted that offering various services gives these startups the flexibility to adapt to the changing circumstances. “Startups that proactively expand their offerings and limit their reliance on the US markets are most likely to come out of this situation unaffected,” Bhatia said.

As things stand, however, nobody knows when the situation will improve. Startups that pivot to accommodate the changing reality will be better placed to weather the storm.