Byju Raveendran, co-founder and CEO of Byju’s, on Thursday told employees that the edtech firm was going through a tough phase but will soon come out of it.
“We are in a tough phase, but we will come back soon… last 12 months we have been struggling. But edtech will stay forever, and we are the pioneers. It is one of the most important sectors and we are in the correct space,” Raveendran told employees in a 45-minute video townhall address, his first after the resignation of three board members and statutory auditor, Deloitte last week. The company is also battling a consortium of lenders in the US courts.
Sources said that he also informed that the company is close to achieving profitability at the group level.
Raveendran told employees that the resignation of the board members was not due to Deloitte quitting as its statutory auditor. He said that the resignation of the board members was amicable and done with mutual understanding. The resignation of Deloitte was due to the decision to appoint BDO as the statutory auditor for the next five years. Raveendran said this was a strategic decision.
He said that the company’s ongoing discussions with its term loan B lenders are progressing well. “These discussions have taken a significant turn and we will get positive development within weeks,” Raveendran said.
Sources said that he talked about his optimism on the edtech sector and said that it offers a huge potential with the market slated to grow 2x in the long term. He also said that about four of Byju’s six biggest acquisitions are profitable, with Aakash, Great Learning and Tynker doing well. “Byju’s will continue to grow for the next 5-10-20 years,” Raveendran added.
However, employees said that Raveendran did not take any questions from them, hence there was no clarity on issues like layoffs, hikes, incentives and provident fund payments.
As earlier reported, Byju’s recently has been embroiled in several controversies around its financial performance, debt burden, and delay in filing financial results for FY22. One of its key investor, Prosus has recently lowered the valuation of the firm to $578 million for its 9.6% stake. Prosus’ 9.6% stake value pegs Byju’s valuation at around $6 billion instead of $22 billion when it last raised funds.