Byjus: In five stories: a year of controversy for Byju’s

Byju’s, India’s highest-valued startup, has had a rough 2022 thanks to a series of financial controversies, unpaid loans, management and layoffs, among other things.

The ETtech team has kept a close eye on all the developments surrounding Byju’s. Here are five must-read stories:

Byju’s losses widen to Rs 4,588 crore in delayed FY21 results

Byju's financial performanceETech

After a delay of nearly 18 months, Byju has released its audited results for the financial year ended March 2021 in September 2022. The company revised its profit from operations to Rs 2,280 crore though it had a massive loss of Rs 4,588 crore, up from just Rs 262 crore in the previous fiscal.

This is a huge drop of 48% from the expected revenue. Byju Raveendran, founder and CEO of Byju’s, attributed this to changes in the business model due to the Covid-19 pandemic.

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Cofounder Divya Gokulnath also dismissed media reports about the company’s FY21 financials being delayed in a lengthy LinkedIn post.

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Byju sacks around 2,500 employees in ‘rationalisation’ bid

A month after handing over its audited FY21 financials 18 months late, Byju announced mass layoffs in October. The company said it would lay off 2,500 people, or about 5% of its 50,000-strong workforce.

Also Read: Byju staff allege harsh working conditions at edtech giant

Before this, the company laid off at least 600 people from group companies such as Toppr and WhiteHat Jr.

Raveendran later acknowledged in an internal email that the layoff process was “not as smooth” as the company had intended.

The company, which decided to shut down and lay off 140 employees at its product development center in Thiruvananthapuram, had to reverse the decision after the state government intervened.

Access to all types of capital to close large multi-billion dollar acquisitions: CEO

Raveendran told ET in an interview in May that the next 12 months is the best time to acquire companies.

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“We’re looking at large multi-billion-dollar acquisitions… That’s why we’re accessing all kinds of capital. We are evaluating acquisitions in the US.”

Byju’s raises $800 million at $22 billion valuation

As part of a pre-IPO round, the company raised $800 million in fresh funding in May. Founder Byju Raveendran invested $400 million in his personal capacity in the round.

In October, Byju closed a financing round of $250 million from its existing investors, including the Qatar Investment Authority (QIA). Tiger Global and Sequoia Capital are also putting money into India’s highest value startup.

A few days later, Byju took a Rs 300 crore loan from its subsidiary, Aakash Educational Services.

In December, the startup appointed an adviser to restructure its $1.2 billion in debt. It also put on hold the $1 billion plans to list Aakash Educational Services.

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ICAI, NCPCR probe and many more

In November, the Institute of Chartered Accountants of India (ICAI) said it was looking into several “issues” with the company’s financial disclosures.

Lok Sabha member Karti Chidambaram had earlier flagged concerns about the edtech startup’s finances.

The National Commission for Protection of Child Rights (NCPCR) later summoned Raveendran over allegations of malpractice by the company’s sales team.

‘Loss after loss’: parents detail how Byju pushed them into debt

Following this, NCPCR chairman Priyank Kanoongo told ET that Byju’s will introduce an ‘affordability’ test for parents to better understand their financial bandwidth.

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