Has Byju's run come to an end? Byju's bleeding!
Byju’s is currently grappling with a series of challenges, including funding shortages, corporate governance issues, and legal disputes.
Manipal Group Rescues Byju’s with Rs 1,400 Crore Injection
Once the world's most valuable edtech company, Byju’s is currently grappling with a series of challenges, including funding shortages, corporate governance issues, and legal disputes. To navigate this turbulent period successfully, the company faces the urgent task of securing a minimum of $1.5 billion in funding and restoring stability within its organization. The question remains: Can it achieve this?
In June, rumors began circulating within Bengaluru's real estate circles regarding Byju’s postponement of rent payments. Speculations arose that India's leading edtech firm might be contemplating vacating substantial office space. Specifically, Byju’s corporate entity, known as Think & Learn Pvt. Ltd, had leased three properties, with the largest being Kalyani Tech Park in Brookefield, spanning over half a million square feet and incurring a monthly rent of Rs 3 crore.
By the end of July, Byju’s had vacated most of the Brookefield premises, instructing its employees to work from home or alternative offices. An executive from a prominent property consultancy firm confirmed that Byju’s had been facing challenges with rent payments even before the move. This development did not come as a surprise to many observers.
Delayed rent payments were not the sole indication of Byju’s financial troubles. The company had also encountered difficulties in meeting statutory obligations, including payments towards employees' provident fund. Moreover, its workforce had shrunk significantly, decreasing from 58,292 employees in March 2022 to 24,787 by May 2023, as reported by PrivateCircle Research, a private market intelligence platform.
Further adding to Byju’s woes, the company's statutory auditor resigned, and three board members representing its investors followed suit. G.V. Ravishankar from Peak XV Partners, Vivian Wu associated with The Chan Zuckerberg Initiative, and Russell Andrew Dreisenstock from Prosus NV stepped down from the board, citing "differences" with Founder Byju Raveendran. Consequently, the board composition was reduced to Raveendran himself, along with his wife Divya Gokulnath and brother Riju Ravindran.
