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Mousumi Malik, a Montessori teacher, had been working at a playschool in suburban Kolkata. In July, she started a playschool at her home with five students and some help from FlintoClass, which offers all learning tools needed for a preschool.
It offers curricula, lesson plans for three sessions every day, material to engage the child and teacher-training modules, says Arunprasad Durairaj, chief executive & co-founder, Flintobox, a Chennai-based start-up that raised $7 million from early-stage venture capital firm Lightbox.
Lightbox has been encouraged by the positive feedback from parents. Flintobox offers an early-child skill development module (for two- to eight-year-olds), which uses experiential learning models to help parents engage with the child at home. ‘’It is a great product,” says Prashant Mehta, partner, Lightbox.
Adding: “We have been impressed with what it has been able to achieve with $1.5 million in funding. The firm is profitable at scale. While it continues to invest in its subscription model, Flintobox, its new business line, FlintoClass, which offers preschool in a box, will target independent preschools.”
The company, started in 2013, was initially backed by GSF Accelerator and, in subsequent years, by GSF Angels, Globevestor, Indian angel investor Ashvin Chadha and Globevestor. Some like Globevestor are partially exiting the company through secondary sales to new investor Lightbox. “We turned positive last quarter, are cash efficient and have low cash burn,” says Durairaj.
Flintobox is an early-child development product, through which parents can engage 1:1 with a child.
Lessons in a box
Flintobox is an early-child development product, through which parents can engage 1:1 with a child. It offers three-month or 12-month subscriptions and sends new ideas in a box every month. These are focused learning modules, aimed to promote cognitive, physical and emotional development. Starting with 310 subscriptions in 2013, Flintobox claims 40,000 subscriptions across 700 cities, at Rs 650 per child per month.
Preschool in a box
In FlintoClass, the start-up thinks it has a product that can redefine the preschool system. “We provide everything you need to run a preschool,” says Durairaj. It charges Rs 500 per child per month; a school can start with five students, and pay more as it grows.
The problem with preschools in India is the lack of high-quality educators. ‘’There are not many early-child educators. So, independent preschools (not part of a chain) struggle to grow and deliver high-quality education and experience,” says Durairaj. It’s early days yet. Launched in January 2017, FlintoClass has signed up 350 schools, where the number of students ranges from six to 130.
The company is targeting 1,000 preschools in a year, which will make it the largest preschool system in India that doesn’t own a school. In five years, it hopes to penetrate 10,000 preschools. This will fetch the start-up annual revenues of Rs 6 billion, which includes Flintobox that is likely to contribute 40 per cent of the revenue by then.
It’s not that the company thought of FlintoClass as an afterthought. It always wanted to get into preschools and shared it with investors. “We can touch a kid’s life at home, where they spend maximum time in early years, and at preschools, like a second home for many. Both cater to the development needs of a child,’’ says Durairaj.
The company is trying to fix a gap in the preschool system. Lack of educators cannot be fixed overnight. Becoming a franchise for a top brand is expensive — it calls for an investment of Rs 1.5-2 million. FlintoClass trains teachers and provides them with the required tools to deliver a high-quality learning experience.
EXPERT TAKE
Improving renewal percentage a challenge
Nitin Pandey, Founder & CEO, parentune.com
Research in the ‘Early Learning Years’ points to 95 per cent of brain development in early years. Cognitive development peaks for the age span of three to seven years. Interactive play & learn boxes can play a significant role in a child’s overall development. Parents expect the box to be age-appropriate and to foster their child’s development. Parents look for a validation from like-minded fellow parents and recommendations from experts. Good design and material quality is hygiene in this segment. Logistics prowess can be outsourced.
This segment has low entry barrier but high sustainability barriers. There are two game changers in this segment, customer acquisition cost (CAC) and renewal throughput. Flinto tried various things early on and then focused on tackling the demerits of screen time in children. The top challenges are to improve the renewal percentage as they scale and to optimise the CAC. Their recent iteration for preschools, FlintoClass, is a new revenue stream. If done well, this can mean optimising the two game changers with this alternative approach. Overall, whosoever has the parents’ preference in this segment shall be the winner.
