Great Learning on China’s edtech crackdown

India has witnessed a robust funding flow from investors during the first half of this year with education technology and financial technology companies attracting a substantial chunk of the investment pie. And now, as the Chinese government proceeds with its regulatory crackdown on its domestic technology industry, the key beneficiaries of such an exercise is likely to be Indian tech firms. Mohan Lakhamraju, founder and CEO of edtech firm Great Learning—which was recently acquired by Byju’s for $600 million—believes capital will follow opportunities.

“I don’t want to make a statement as if India will be a disproportionate beneficiary [from tech crackdown in China]. Ultimately it is not about the country, it is about opportunities. Investors are investing in companies and not in countries,” says Lakhamraju in an exclusive interview to Fortune India.

“Wherever there are good companies, capital will follow. And India happens to have a very good ecosystem of good companies which is why it will have its share of capital,” he says, adding that not just India, other markets such as South-East Asia, Latin America, and Africa will also benefit from the situation in China.

Industry expert Sandeep Das concurs. “Investors will follow where there is a large market for paying consumers and widespread digital infrastructure.”

“In my view, the edtech players will figure out a way to work with the regulatory authorities to avoid societal pressure on young kids the way Ant Group is working with the regulatory authorities now. The fund flow to India will happen because of the potential of the Indian market and not so much because of what is happening in China,” says Das, the author of Hacks for Life and Career: A Millennial’s Guide to Making it Big.

“They [the Chinese government] will figure out a way in which there will be a new equilibrium. I don’t think China will be so unfriendly to investors,” adds Lakhamraju, pointing out that despite the recent developments in China, India was getting a lot of attention from global investors in terms of funding.

“India right now is going through a golden period of entrepreneurship. Over the last decade the entrepreneurial ecosystem has gone deeper. We are going through a strong phase and that is reflected in the amount of capital that Indian companies are raising from global investors,” says Lakhamraju.

According to a recent PwC India report, 17 companies raised funds in the range of $100 million to 500 million during the first half (January 1 to June 15) of this year. Late-stage deals recorded during the same period also attracted top dollar, including India’s largest edtech company Byju’s raising $785 million and food-delivery platform Swiggy raising $800 million in funding. Edtech was the most funded sector last year with Byju’s alone accounting for $1.4 billion in funds raised.

Commenting on the recent deal with edtech major Byju’s, Lakhamraju pointed out that going forward, Great Learning will operate as a higher and professional education division within Byju’s. It will largely operate as an independent unit with certain strategic synergies.

Founded in 2013, Great learning, which operates in the professional and higher-education space, has delivered over 60 million hours of learning to 1.5 million learners from over 170 countries. Byju’s has earmarked a further $400 million of investment into accelerating Great Learning’s growth.