In the midst of layoffs, Ed-tech company Byju’s has named football player and world-renowned sports legend Lionel Messi as the brand ambassador for its social impact arm – Education For All (EFA). An irony that we must accept. The Ed-tech major has been slammed by netizens for mass-firing and concurrently associating the costliest player. Additionally, Lionel Messi has an approximately 450 million strong social media following.
This move comes as Byju has laid out a plan to “optimize its marketing and operational cost” and become profitable by March 2023, which will result in the layoff of 5% of staff, or roughly 2,500 individuals, in the upcoming six months.
Kerala Centre: Twist & Turn
After conciliatory talks that were led by Chief Minister Pinarayi Vijayan with Byju’s, it was decided that the edtech unicorn will not shut its operations at the Technopark campus here and decided to relook at the restructuring plans and continue its development center in the Trivandrum Technopark office.
FIFA World Cup 2022 & BCCI Connection
Notably, in 2021, Byju’s made the headlines as the first Indian company to become the official sponsor of the FIFA World Cup 2022 in Qatar. It is well known that worldwide, there are over 3.5 billion fans of football and the right place to connect with passionate football lovers across the world.
Byju’s and the BCCI agreed to extend their partnership until the end of the 2023 ODI World Cup in India in April. Byju’s initially joined the Indian team in 2019, when mobile manufacturer Oppo ceded sponsorship rights to the online teaching startup.
BYJU’S Under Fire
Byju’s recorded a loss of 4,588 crores for the fiscal year ended March 31, 2021, which was 19 times greater than the previous fiscal year, as the nation’s most valuable start-up released audited financial statements after months of delay.
The losses in the 2020-21 fiscal year increased from 231.69 crores in the previous year. Revenue fell to 2,428 crores in FY21, down from 2,511 crores in FY20.
However, for the fiscal year ending March 31, 2022, the company said revenue increased fourfold to 10,000 crores, but it did not disclose profit or loss figures.
According to Byju’s, the losses widened in FY21, owing primarily to the deferment of some revenue and losses incurred from WhiteHat Jr.
According to Mr. Byju Raveendran (Founder), the company is considering postponing its initial public offering (IPO) due to the macroeconomic environment’s volatility.
BYJU’S New Acquisition
According to Mr. Raveendran, Byju’s has also put a hold on new mergers in light of the shift in the macroeconomic environment and is instead concentrating on integrating recent acquisitions.
Epic, a U.S.-based reading platform, and Tynker, a coding website, were earlier bought by the corporation for $500 million and $200 million, respectively.
Other foreign acquisitions by Byju include the Austrian math operator GeoGebdra for roughly $100 million and Singapore’s Great Learning for about $600 million.
However, there are talks about American edtech firms 2U. Byju has made an offer, but it is currently on hold.
By the end of this year, the business hopes to build it up to 500 offline centers across India, where it now claims to have over 200 active centers.
BYJU’S Under Government Scanner
The Department of Consumer Affairs has identified Byju’s as one of the edtech companies that misrepresent courses and has drawn attention to the numerous consumer complaints. Furthermore, the most valuable startup in India has been advised to collaborate with the Advertising Standards Council of India (ASCI) for the claims made in its advertisements.
Karti Chidambaram, an Indian lawmaker, was among the first to call for an investigation into Byju’s finances, citing a delay in submitting its financial statements for the fiscal year that ended in March 2021.
BYJU’S In Brief
BYJU’s, a Bangalore-based educational technology platform, is a freemium online tutoring and coaching firm for students in grades 1 through 12 as well as those preparing for competitive exams. The parent firm of BYJU is ‘Think and Learn Pvt Ltd. In 2018, Byju’s joined the unicorn club of Indian startups as the 11th unicorn. With a presence in more than 340 districts, Byju’s EFA has partnered with 128 NGOs spanning 26 states.
BYJU’S was established in 2011 by Byju Raveendran. With a $3.05 billion net worth, he ranks as the youngest billionaire in India, according to Forbes’ list of the country’s 100 richest individuals (2020).
This platform is used by over 15 million students worldwide and has 9,00,000 paid subscribers. Its approach combines learning re-invention, world-class teachers, tried-and-true pedagogical methods, and personalized learning.
The tagline of BYJU is “Fall in love with learning.” Byju’s was named after its founder’s first name.
Byju’s CEO, Byju Raveendran, now owns nearly 25% of the company, while co-founder and his wife Divya Gokulnath and the management team own about 4%.
According to reports dated July 7, 2022, Byju’s valuation, which was last estimated at $22 billion at the end of the round, has now scaled to $23 billion.
Byju’s current situation makes it evident that one may have to pay a price for rising too quickly. It’s not that the business lacks funds; rather, its unprecedented growth in an unconsolidated manner has resulted in a significant amount of organizational redundancy. One has to correct it sooner or later, and these layoffs are the outcome of that.
