BYJU'S, one of India's leading EdTech platforms, and its Co-founder and Chief Executive Officer (CEO), Byju Raveendran, are back in the spotlight after Raveendran's shocking revelation that the company’s net worth has currently fallen to zero.
The situation has been aggravated by the resignation of three key investors — Prosus, Peak XV Partners, and the Chan Zuckerberg Initiative — making fundraising difficult. In light of these developments, EdexLive spoke with BYJU'S spokesperson, Rethu Panicker, to gather insights into the company’s financial strategy and leadership.
1. Byju Raveendran recently revealed the company’s net worth is zero. What are your thoughts?
Raveendran envisions a recovery plan focused on reviving the core business, using BYJU'S vast content library, and restructuring operations to ensure long-term sustainability.
2. How does BYJU'S plan to address its ongoing legal disputes with creditors?
Raveendran has injected all his personal funds into the company, leaving him with "literally zero" personal assets, showing his commitment. Despite salary disruptions, BYJU'S has prioritised paying teachers. While Raveendran explored selling assets like Epic and Great
Learning to generate liquidity, these efforts were blocked by lender demands for full loan repayment.
This, he argues, demonstrates his commitment to the company and undermines accusations of financial impropriety.
Speaking about selling assets, Raveendran claims to have explored selling assets like Epic and Great Learning to generate liquidity and appease US lenders. He asserts that he received "three solid offers" for Epic but the deals fell through because the lenders demanded full repayment of the loan,
hindering his ability to negotiate a partial settlement.
3. What is BYJU'S strategy for the next 12-18 months, particularly regarding cost management?
Raveendran aims to counter negative narratives and stabilise the company. He stresses that most subsidiaries, including Akash, Great Learning, and Epic, are performing well and cash-flow positive. Akash and Great Learning have seen significant growth, with Akash's student base doubling and Great Learning serving three times the pre-acquisition numbers.
● Akash Services: Byju highlights that Akash Services has witnessed substantial growth, with the number of students served increasing by two and a half times since the acquisition.
● Great Learning: Similarly, Great Learning has also experienced notable growth, serving three times the number of students compared to pre-acquisition levels.
● BYJU'S Core Product (App): Despite challenges in the services segment of the core BYJU'S business, Byju emphasises that the app-based learning products continue to operate without disruptions and have seen a 60% increase in student users.
4. How has the internal management structure evolved to stabilise the company?
Byju and his family remain committed to the company, with five of the six founding partners still involved. He believes that securing just one investor could spark the company's revival, and he is ready to invest further personally.
He expresses confidence in the company's revival, suggesting that the family will be actively involved in these efforts. He believes it "takes just one investor to make a comeback" and expresses willingness to personally invest further, implying that his family shares this commitment.
5. There are reports of Byju Raveendran considering a new EdTech venture. Is this true, and how would it differ from BYJU'S?
Raveendran remains deeply involved in product development, focusing on innovations like AI-powered learning tools. His personal brand has been key to building BYJU'S reputation, and any new venture would likely benefit from his ability to attract investors and create high-quality educational content.
Brand Building: Byju Raveendran's charisma and personal brand played a significant role in establishing BYJU'S as a household name in India. His appearances in marketing campaigns and his reputation as a gifted teacher helped build trust and credibility with parents and students alike.
Fundraising and Investor Relations: Byju Raveendran's ability to secure substantial investments from prominent global investors, including Sequoia Capital, Chan Zuckerberg Initiative, and Lightspeed Venture Partners, fueled the company's rapid expansion. He successfully
positioned BYJU'S as an attractive investment opportunity, attracting billions of dollars in funding.
6. What measures is BYJU'S taking to improve corporate governance and transparency with investors?
While Byju Raveendran doesn't explicitly address specific corporate governance failures, he alludes to areas where improvements could have been made, particularly regarding board composition and decision-making processes.
Raveendran acknowledges past governance issues, particularly around board composition. He stresses the company’s commitment to addressing employee concerns, prioritising teacher salaries, and reassuring students and parents that the core learning products have remained stable, with strong user engagement continuing.
What about addressing employees' concerns?
Raveendran acknowledges the significant job losses and salary payment issues resulting from the financial crisis. He stresses that the company has made efforts to prioritise teacher salaries, even during bankruptcy proceedings. He emphasises the role of the remaining employees in maintaining the company's operations and expresses his commitment to compensating them for the disruptions they have faced.
