Byju Raveendran, an engineer from Kerala, envisioned revolutionising education systems through his startup venture. Over the years, his startup, Byju's, soared to great heights, earning the moniker of a startup star. With a valuation reaching $22 billion in 2022, Byju's appeared unstoppable.
The current downturn
However, today, Byju's finds itself grappling with severe financial distress, struggling even to pay its employees' salaries. The company's chief, billionaire Byju Raveendran, is unable to steer the company back on track. The sudden downfall has left many wondering about the company's missteps.
Unraveling the story
Founded in 2003, Byju's initially gained traction by aiding friends in cracking the CAT entrance exam. By 2011, it had officially registered as Think and Learn Private Limited. Byju's catapulted to prominence with the launch of its interactive learning app, catering from kindergarten through 12th grade. It soon became India's premier ed-tech unicorn.
Financial fiasco
Reports suggested that Byju's faced a sudden setback in June 2023, as Dutch-listed investor Prosus NV slashed the startup's valuation by more than 75% from its 2022 peak of $22 billion. Administrative and cash flow woes compounded, leading to a significant workforce reduction. Allegations of financial mismanagement and aggressive marketing tactics tarnished the company's image, contributing to its downfall.
The auditors' exit
As financial woes deepened, Byju's auditor, Deloitte, distanced itself from the company. Byju's defaulted on loan payments, witnessing a staggering loss of Rs. 4,564 crore in just a year. The company's precarious financial state has left its remaining employees anxious about receiving their due salaries.
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