Byju's founder says his edtech startup, once worth $22B, is now 'worth zero'
Byju Raveendran, the founder of the embattled edtech group Byju's, acknowledged on Thursday afternoon that he made mistakes, mistimed the market, Byju Raveendran, founder of edtech group Byju's, said his startup, once valued at $22 billion, is now effectively worth "zero."
Byju Raveendran, the founder of the embattled edtech group Byju’s, acknowledged on Thursday afternoon that he made mistakes, mistimed the market, overestimated growth potential and that his startup, once valued at $22 billion, is now effectively worth “zero.”
In a recent candid conversation with a group of journalists, Byju's founder Byju Raveendran revealed the shocking truth behind the startup's downfall, which has left the founder with a bitter taste in his mouth. Despite being once valued at a staggering $50 billion, Byju's has since entered insolvency proceedings, a far cry from its former glory.
Raveendran attributed the company's demise to its aggressive expansion into new markets, which ultimately proved fatal when financing dried up in 2022. The startup had planned to go public earlier that year, but the global market downturn following Russia's invasion of Ukraine sent the venture capital market into a tailspin. Many of Byju's over 100 investors had urged Raveendran to pursue expansion into as many as 40 markets, but when the global market crashed, those very investors "ran away," leaving the startup high and dry.
The departure of three key backers – Prosus Ventures, Peak XV, and Chan Zuckerberg Initiative – from the company's board last year made it impossible for Byju's to raise additional funds. Representatives of the aforementioned three firms, as well as auditor Deloitte, left the startup's board last year, citing governance issues. Raveendran lamented, "It's worth zero. What valuation are you talking about? It's worth zero." The founder's words are a stark reminder of the devastating consequences of poor governance and accountability.
Byju's, once India's most valuable startup, had raised over $5 billion from prominent investors such as BlackRock, UBS, Lightspeed, QIA, bond, silver Lake, Sofina, Verlinvest, Tencent, Canada Pension Plan investment Board, General Atlantic, Tiger Global, Owl Ventures, and the world Bank's IFC.
Despite the setbacks, Raveendran remains hopeful that his startup will make a comeback. "I have nothing to lose. I came from a small village. I invested everything I had into the startup." The founder's determination to revive Byju's is a testament to his unwavering commitment to his vision.
The story of Byju's serves as a cautionary tale for startups and investors alike. It highlights the importance of prudence and caution in the face of uncertainty, as well as the need for strong governance and accountability. As Raveendran's words echo through the startup ecosystem, one thing is clear: the demise of Byju's is a stark reminder of the risks and challenges that come with entrepreneurship.
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