Struggling Indian ed-tech startup Byju’s is seeking to secure more than $100 million from existing investors, with plans to issue fresh shares at a significant 90% discount to its $22 billion valuation from its last funding round in 2022, according to media reports.
Amidst a series of legal and financial challenges, Byju’s aims to raise capital for vendor payments and business stabilisation through the sale of new shares, including those to founder Byju Raveendran, according to sources familiar with the matter cited by Bloomberg.
The share issuance, scheduled for the upcoming month, is expected to value the company at less than $2 billion, a stark decrease from its $22 billion valuation in the late 2022 round, where it successfully raised $250 million. Byju’s declined to comment on the matter and attempts to reach Raveendran for comment were unsuccessful. The Bloomberg report did not disclose the names of the investors anticipated to participate in this latest funding round.
Earlier this month, BlackRock reduced Byju’s valuation by 95% to $1 billion, while tech investor Prosus NV lowered it to under $3 billion in November of the previous year. These valuation cuts coincided with reports of Raveendran pledging his homes for funding, intended to cover staff payments following the departure of several executives and board members. The exits were triggered by a delay in filing the company’s 2021/22 financial results.
Despite a more than doubling of total income, Byju’s experienced a widening core loss of over 61% in fiscal year 2022, as indicated by data from a statement filed with the registrar of companies on Tuesday. Notably, in November, the company had reported a six percent reduction in its operating loss for the 2021-2022 period in its core online education business.
With inputs from Reuters.