Byju’s key investors — Prosus, General Atlantic, Sofina and Peak XV — have moved the tribunal against the embattled edtech major over its $200 million rights issue….reports Asian Lite News
Key investors in Byju’s alleged on Tuesday that the Enforcement Directorate (ED) is investigating diversion of funds of over $500 million by the edtech company to a hedge fund in the US.
In the ongoing hearing at the National Company Law Tribunal (NCLT) in Bengaluru, the investors alleged that the address of the hedge fund was a “pancake shop” and its founder “is a 23-year-old without any training”.
“About $533 million has been siphoned off. He (Byju Raveendran) wants us to invest more money. How will we be protected?”
Byju’s key investors — Prosus, General Atlantic, Sofina and Peak XV — have moved the tribunal against the embattled edtech major over its $200 million rights issue.
During the hearing, the investors claimed that “if the amount is parked in their bank account especially when the man is sitting abroad and is not coming to India, it will become irreversible”.
Earlier in the day, the investors argued that the process adopted by Byju’s for its $200 million rights issue is “in breach of laws”.
They said that the board of directors had to call an Extraordinary General Meeting (EGM) of shareholders before the rights issue so that they could vote.
“The board of directors did not call a general body meeting before rights issues as they are aware that the general body is not in their favour,” argued the lawyer on investors’ behalf.
“Our 25.4 per cent stake will come down to 2.5 per cent if we don’t subscribe to the rights issue. If we subscribe, we don’t know what happens to our money,” the investors said.
Byju’s argued that the investors were “forum shopping” by approaching the NCLT.
“If the NCLT passes any order today, it will dilute the order of Karnataka HC,” the company’s lawyer said.
“The investors are not looking at the interest of 100 million students and the 12,000 employees but only at their value maximisation.”
“It has been 21 months since our last capital raise,” the company added.
Chaudhry was the CEO till November 2020, and later resigned from the board last December….reports Asian Lite News
In some cheers for edtech unicorn Byju’s which is facing a myriad of issues, Aakash Chaudhry is reportedly set to return as CEO of Aakash Educational Services that Byju’s acquired in April 2021.
According to sources, the companies are finally set to reach a deal after months of dispute.
Chaudhry was the CEO till November 2020, and later resigned from the board last December.
The Economic Times was first to report about the development.
Byju’s acquisition of Delhi-based offline test preparatory services provider Aakash for nearly $1 billion was still incomplete and Chaudhry, Co-Promoter and Managing Director of Aakash Educational Services Limited (AESL), had earlier resigned from the board.
With the new development, the Aakash promoter group is close to executing its share-swap in Byju’s.
The share-swap will give Chaudhry around 8 per cent in Think and Learn Pet Ltd, which is Byju’s parent company.
Chaudhry is likely to retain around 9 per cent in Aakash, the report mentioned.
Think & Learn will hold around 51 per cent of the company after the deal, according to sources.
Byju’s and Aakash were yet to comment on the development. Earlier this year, Byju’s denied reports that it was considering a merger of rival Gaurav Munjal-run Unacademy into Aakash Educational Services.
An Aakash spokesperson had said that they have had “absolutely no discussions with Unacademy or any other player to merge with Aakash Educational Services” .
Meanwhile, Byju’s is likely to release its financial statement for FY22 this month.
The company was scheduled to convene a board meeting in the second week of October “for approval and adoption of accounts for FY22”.
“Think and Learn Pvt Ltd has issued a notice for convening a Board meeting in the second week of October 2023 for approval and adoption of accounts for FY22,” a Byju’s spokesperson said.
Byju’s is mulling to sell at least two of its subsidiaries, Epic and Great Learning, to raise between $800 million and $1 billion, amid reports that the company has formulated a proposal to repay its outstanding $1.2 billion Term Loan B (TLB).
The company, which has sacked thousands of employees to date and has taken deeper cuts, was still unable to achieve profitability at group level amid mounting losses…reports Asian Lite News
India’s edtech superstar Byju Raveendran who rode the edtech wave during the pandemic seems to be in a tight spot. The journey of Byju’s has been a roller-coaster ride. It began as a start-up that rose rapidly, garnered high-profile investors by the score, and became the quickest in India to achieve a decacorn status, with a valuation of over $10 billion. However, the company’s trajectory took a steep plunge just as swiftly. From a lofty $22 billion valuation in 2021, it has dropped to slightly more than $5 billion now.
Similarly, its workforce has shrunk from 59,000 to less than 34,000, with numerous layoffs in recent weeks. With each passing day, the co-founders find themselves in increasingly turbulent waters. Soon enough, the investors will have to make pivotal decisions about this start-up, whose problems seem to be piling up.
Chetan Bhagat, author, and YouTuber in a column in Times Of India, has said that, “It is baffling how Byju’s could delay the publishing of its financials though such sophisticated investors were involved.” He added, There are lessons here if we want India’s startup ecosystem and entrepreneurship to thrive.”
Recentl Byju’s defaulted on its loan of $1.2bn in the US. Its auditor Deloitte resigned citing concerns with Byju’sfinancials, which the company had not provided for over a year.
The company, which has sacked thousands of employees to date and has taken deeper cuts, was still unable to achieve profitability at group level amid mounting losses.
At a group level, BYJU’s had said in October that its top priority was to achieve “overall profitability by March 2023”. Between April and July 2022, the company logged a revenue of Rs 4,530 crore. Post that, there has been no communication from the company about the pending results. The edtech unicorn reported a loss of Rs 4,588 crore for the fiscal year ended March 31, 2021.
BYJU’s had claimed that it clocked gross revenues of nearly Rs 10,000 crore in FY22. Earlier this month, sources had said that the edtech major is set to raise around $500-$700 million in its latest funding round at a flat valuation of $22 billion, led by a couple of top private equity firms and sovereign wealth funds.
Byju’s overvaluation still not have jeopardised the company. But it u1adea rookiemistake.Despite huge cashflow losses, it took on a $1.2 billion loan abroad.
The Bengaluru-based firm is also fighting allegations of having association with investors with questionable identities like Sumeru Ventures and Oxshott Capital Partners, who are yet to infuse some $250 million into the company committed months back. Byju’s has attributed the delay to ‘macroeconomic changes’. It is understood that the investment in Byju’s is the only transaction Oxshott Capital Partners has made thus far. Quite along similar lines, Sumeru Ventures, which was launched in 2018 has reportedly made three investments only in 2022, having been inactive for the best part of its existence. Recently, Congress MP Karti Chidambaram pointed out these anomalies in a letter to the government’s serious fraud probe agency seeking an investigation into the start-up’s finances.
Sensing the importance of offline learning in India, a market where a large portion of the population is still very much receptive to the idea of classroom education, edtech players are going hybrid. Byju’s for instance, has launched brick-and-mortar tuition centres which co-founder Divya Gokulnath claims has been well received in the market. These physical centres are tech enabled and offer a hybrid or blended learning format to students of classes 4-10.
The company’s creator, Byju Raveendran, addressed the media after the initial findings were made public to clear any problems about the company’s future. Like attributing the slowing of growth to the change in revenue recognition accounting in FY21 or the point that EMI-driven sales were not recognised until important collections were made.
Both seem to be glaringly obvious upgrades that are not possible to reassure investors when viewed in retrospect. The rumours involving its business practices can still be dismissed if you give it credit for its size and scope. Byju’s claim that it is done with layoffs has already been rejected as news came last week that 2,500 more employees (out of a workforce of roughly 50,000) were fired due to what most outlets have directed to as “growth worries.”
If FY23 is already looking bleak, one must wonder whether the current approach is viable and able to deliver the kind of profits that investors have paid for. Raveendran’s projections that the company would serve admirably after FY21 may still be seen in the topline for FY22.
The company, which has sacked thousands of employees to date and has taken deeper cuts, was still unable to achieve profitability at group level amid mounting losses….reports Asian Lite News
India’s edtech superstar Byju Raveendran who rode the edtech wave during the pandemic seems to be in a tight spot.
The journey of Byju’s has been a roller-coaster ride. It began as a start-up that rose rapidly, garnered high-profile investors by the score, and became the quickest in India to achieve a decacorn status, with a valuation of over $10 billion.
However, the company’s trajectory took a steep plunge just as swiftly. From a lofty $22 billion valuation in 2021, it has dropped to slightly more than $5 billion now.
Similarly, its workforce has shrunk from 59,000 to less than 34,000, with numerous layoffs in recent weeks. With each passing day, the co-founders find themselves in increasingly turbulent waters. Soon enough, the investors will have to make pivotal decisions about this start-up, whose problems seem to be piling up.
Chetan Bhagat, author, and YouTuber in a column in Times Of India, has said that, “It is baffling how Byju’s could delay the publishing of its financials though such sophisticated investors were involved.” He added, There are lessons here if we want India’s startup ecosystem and entrepreneurship to thrive.”
‘Worst is over’ and youâll only see growth in coming months: Byju Raveendran.
Recently Byju’s defaulted on its loan of $1.2bn in the US. Its auditor Deloitte resigned citing concerns with Byju’sfinancials, which the company had not provided for over a year.
The company, which has sacked thousands of employees to date and has taken deeper cuts, was still unable to achieve profitability at group level amid mounting losses.
At a group level, BYJU’s had said in October that its top priority was to achieve “overall profitability by March 2023”. Between April and July 2022, the company logged a revenue of Rs 4,530 crore. Post that, there has been no communication from the company about the pending results. The edtech unicorn reported a loss of Rs 4,588 crore for the fiscal year ended March 31, 2021.
BYJU’s had claimed that it clocked gross revenues of nearly Rs 10,000 crore in FY22. Earlier this month, sources had said that the edtech major is set to raise around $500-$700 million in its latest funding round at a flat valuation of $22 billion, led by a couple of top private equity firms and sovereign wealth funds.
Byju’s overvaluation still not have jeopardised the company. But it u1adea rookiemistake.Despite huge cashflow losses, it took on a $1.2 billion loan abroad.
The Bengaluru-based firm is also fighting allegations of having association with investors with questionable identities like Sumeru Ventures and Oxshott Capital Partners, who are yet to infuse some $250 million into the company committed months back. Byju’s has attributed the delay to ‘macroeconomic changes’.
It is understood that the investment in Byju’s is the only transaction Oxshott Capital Partners has made thus far. Quite along similar lines, Sumeru Ventures, which was launched in 2018 has reportedly made three investments only in 2022, having been inactive for the best part of its existence. Recently, Congress MP Karti Chidambaram pointed out these anomalies in a letter to the government’s serious fraud probe agency seeking an investigation into the start-up’s finances.
Sensing the importance of offline learning in India, a market where a large portion of the population is still very much receptive to the idea of classroom education, edtech players are going hybrid.
Byju’s for instance, has launched brick-and-mortar tuition centres which co-founder Divya Gokulnath claims has been well received in the market. These physical centres are tech enabled and offer a hybrid or blended learning format to students of classes 4-10.
The company’s creator, Byju Raveendran, addressed the media after the initial findings were made public to clear any problems about the company’s future. Like attributing the slowing of growth to the change in revenue recognition accounting in FY21 or the point that EMI-driven sales were not recognised until important collections were made.
Both seem to be glaringly obvious upgrades that are not possible to reassure investors when viewed in retrospect. The rumours involving its business practices can still be dismissed if you give it credit for its size and scope.
Byju’s claim that it is done with layoffs has already been rejected as news came last week that 2,500 more employees (out of a workforce of roughly 50,000) were fired due to what most outlets have directed to as “growth worries.”
If FY23 is already looking bleak, one must wonder whether the current approach is viable and able to deliver the kind of profits that investors have paid for. Raveendran’s projections that the company would serve admirably after FY21 may still be seen in the topline for FY22.
With 150 million learners around the world, BYJU’S has been leading in tech-driven, personalised and engaging educational content and products…reports Asian Lite News
EdTech company BYJU’S has been announced as an official sponsor of the FIFA World Cup Qatar 2022.
Through this partnership, BYJU’S will leverage its rights to the FIFA World Cup 2022 marks, emblem, and assets, and run unique promotions to connect with passionate football fans around the world. It will also create engaging and creative content with educational messages as part of a multifaceted activation plan.
“FIFA is dedicated to harnessing the power of football towards the goal of enacting positive societal change. We’re delighted to be partnered with a company like BYJU’S, which is also engaging communities and empowering young people wherever they may be in the world,” said Kay Madati, FIFA’s Chief Commercial Officer, in a statement.
“We are excited to be sponsoring the FIFAAWorld Cup Qatar 2022, the biggest single-sport event in the world. It is a matter of pride for us to represent India on such a prestigious global stage and champion the integration of education and sport. Just as footballA inspires billions, we at BYJU’S hope to inspire the love of learning in every child’s life through this partnership,” added Byju Raveendran, BYJU’S founder, and CEO.
Byju Raveendran
With 150 million learners around the world, BYJU’S has been leading in tech-driven, personalised and engaging educational content and products. The company has expanded to cater to a large student community globally – from K-12 and competitive exam preparation to early learning and coding to professional upskilling courses.
It has also empowered 3.4 million students from underserved communities with digital learning in India and aims to reach 10 million students in its home country by 2025.
The FIFA World Cup Qatar 2022 will take place from November 21 to December 18, 2022.
