Indian edtech giant BYJU’S has decided to make new job cuts in the coming weeks as part of a restructuring plan, Business Today has learned from sources. The development comes as edtech struggles with a severe lack of funding, battles with lenders and faces lower valuations.
The layoffs will affect about 4,000 employees, more than 11 percent of the company’s 35,000-strong workforce, the people said. A company spokesperson confirmed this, but declined to say the actual number of employees affected. They pointed out that edtech is in the final stages of restructuring its business.
“We are in the final stages of restructuring our business to simplify our business structure, reduce our cost base and improve cash flow management.” Arjun Mohan, BJYU’s new India CEO, said in the coming weeks We plan to complete this process and move forward with a revamped and sustainable operation,” a BYJU spokesperson said.
Arjun Mohan was appointed CEO of India operations a few weeks ago, replacing Mrinal Mohit. Mohan previously served as the company’s chief business officer (CBO) before leaving to work at Upgrad, an edtech company led by Ronnie Screwborough.
Commenting on Mohan’s return, Raveendran previously said, “His expertise will undoubtedly aid our turnaround efforts and strengthen our position in the global EdTech landscape.”
Edtech top level exit
The edtech major has witnessed multiple high-level departures. Mohit, the outgoing CEO of BYJU’S India operations, has left the company to pursue his personal aspirations, the company said in a statement regarding his departure.
The first to resign were Edtech CEO Pratyusha Agarwal, tuition center business director Himanshu Bajaj, class 4 to 10 business director Mukut Deepak, and Edtech senior vice president of international business. There are four people, including President Cherian Thomas. .
Past layoffs at BYJU’S
It is worth noting that this is not the first restructuring measure for BYJU’S. Earlier this year, Edtech laid off about 1,000 employees. Late last year, the company laid off 2,500 employees.
The company also laid off approximately 600 employees at group companies White Hat Jr. and Topple.
Lack of funds and increasing debt
The edtech giant has been experiencing financial difficulties in recent months. To repay Term Loan B (TLB), the company has decided to sell two major assets, Epic and Great Learning, to generate between $800 million and $1 billion in cash, Business Today first reported. Reported.
Investor and regulatory oversight
The company has come under intense scrutiny from investors and regulators in recent months. In July, the company’s auditor, Deloitte Haskins & Sells, resigned as an auditor, claiming that EdTech was not cooperating with the company’s financial statements.
Following the auditor’s resignation, the heads of the edtech giant’s top three investors – Prosus, Peak XV Partners (formerly Sequoia India) and the Chan Zuckerberg Initiative – also resigned.
Edtech also faced flak from EPFO as the sacked employees alleged that BYJU’S was collecting provident fund dues from employees but not depositing them with EPFO. Days after the issue came to light, EPFO initiated a probe into the company and BYJU’S deposited the employee dues.
Funding and evaluation
The edtech giant has raised a total of $5.8 billion in funding from investors including Qatar Investment Authority (QIA), Sumeru Ventures, Vitruvian Partners, BlackRock, Chan Zuckerberg Initiative, Sequoia, Silver Lake, Bond Capital, Tencent, General Atlantic, and Tiger Global. Procured.
At its peak in 2021, the company was valued at $22 billion, making it the world’s most valuable edtech and India’s most valuable startup. However, multiple investors have since downgraded the company’s valuation on its financial statements.
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