At a time when embattled Indian edtech firm BYJU’s is staring at financial problems, regulatory issues, and legal battles, its founder & CEO Byju Raveendran admitted to having made certain “business mistakes”.
According to a report by news agency ANI, Raveendran acknowledged that the company’s aggressive push to expand into 21 countries beyond India contributed to its current financial troubles.
In an interview with the news agency, Raveendran reflected on the startup’s rapid global expansion, admitting that the move may have been too hasty. He suggested that a more gradual approach would have been wiser, acknowledging that BYJU’s could have been a bit slower while entering international markets.
“I won’t deny so to when we tried expanding from India to the whole world, we made some business mistakes, maybe we could have taken it a little bit slowly, we [were] growing a little too soon, too fast,” Raveendran was quoted by ANI.
Founded in 2015, BYJU’s expanded into 21 countries between 2019 and 2021, a period marked by the COVID-19 pandemic. This rapid international push was driven largely by abundant capital and mounting investor pressure to scale quickly, said Raveendran.
“When we tried expanding from India to the whole world, we made some business mistakes. Maybe we could have taken it a little bit slower. We were growing a little too soon, too fast,” said Raveendran, highlighting how liquidity soon emerged as a major challenge for the startup, as the global market tightened due to the ongoing Russia-Ukraine conflict and interest rate hikes by the US Federal Reserve.
“And from then onwards, and this is early 2022, and it’s almost now three years, we have been struggling for liquidity. But fortunately, we had enough liquidity, which we made, and I have no regrets in terms of putting all that money back,” added Raveendran.
Raveendran admitted that one of the company’s major missteps was opting for a $1.2 billion term loan in 2021 – apparently there were sufficient equity funding alternatives available at the time.
“Only mistake, if you ask me, which created all this is that we shouldn’t have taken this, when we had enough equity options, we shouldn’t have taken this term loan at that time in 2021. One billion (USD) because it was, like, we had other options. We have raised $5 billion before that. We were not doing it out of desperation. It was all a collective decision,” Raveendran told the news agency.
Meanwhile, the news agency also reported that Raveendran’s wife, Divya Gokulnath, alleged that they were being subjected to targeted intimidation efforts and coercive tactics aimed at isolating her husband by threatening those in his inner circle, including family, colleagues, and legal advisors.
Gokulnath also said that she has been threatened as well.
“Yes. They are everywhere. They send people who look like goons. They think we will get intimidated. They don’t know what we are made of. They don’t know where we come from,” she was quoted as saying.
In 2024, a few investors of BYJU’s, which include names such as Prosus NV, General Atlantic, Sofina, and Peak XV Partners, with support from Tiger Global and Owl Ventures had moved the National Company Law Tribunal (NCLT) against the company’s $200 million rights issue at a 99% discount to the company’s peak valuation of $22 billion.
The edtech startup has seen a massive markdown in valuation since its peak in 2022, the last one done by global investment firm Prosus in June 2024.
Road ahead
Despite the turmoil facing the edtech giant, Raveendran remains hopeful and determined to lead its revival.
“About Byju’s 3.0. I am so excited to talk to you about it because we both don’t belong in courtrooms. We belong in classrooms. That’s where we belong. And these classrooms, being based in India, are our biggest advantage. It’s a country where there is so much respect for teachers, so much respect for learning,” Raveendran was quoted by the news agency.
“The reason why we are not giving up on BYJU’S is because we owe it to the students, teachers, and employees who trusted us,” he added.
