Byjus To Lay off 2,500 Employees Due To A 20-Fold Surge In Losses
HIGHLIGHTS
- The startup said that it had let go of workers in order to prevent role overlap.
- BYJU’S stated that it is integrating the K-12 firms it has bought, including Toppr, HashLearn, and Scholar, among others.
- The firm said it aims to achieve profitability by the end of FY23 despite a 20X increase in its loss to INR 4,588 Cr in FY21.
Byju’s, the most valuable edtech firm in the world, announced in a statement that it would be cutting off around 2,500 workers across departments to reduce costs in the face of growing losses. According to a statement from the company, “Around 5% of BYJU’S 50,000-strong staff is planned to be rationalized across product, content, media, and technology teams in a gradual approach to decrease redundancies and duplicate tasks, as well as by employing technology better.”
The company also announced that, with the exception of Aakash and Great Learning, which will continue to operate as independent organizations, its India K–10 business, which consists of Toppr, Meritnation, TutorVista, Scholar, and HashLearn, will now be unified into one business unit. Byju’s, a well-known edu-tech startup in India, announced on Wednesday that it would be laying off 2,500 staff members in an effort to become profitable by March of next year. Tiger Global is funding the company.
The online learning platform, valued at over $22 billion in September, had recorded a loss of 45.64 billion rupees ($554.77 million) for the fiscal year 2021 in May due to rising promotion and personnel spending. This is the startup, which is valued at $22 billion second,’s substantial layoff move in recent months. It eliminated hundreds of positions in June. As a result of lockdowns forcing schools to stay closed for months, Byju’s, which had emerged as a pandemic winner, has seen a decline in demand.
Byju Raveendran, the company’s founder, said in an interview with TechCrunch last month that he doesn’t believe the startup would submit an IPO application in the upcoming 12 months. Additionally, he mentioned that the business is attempting to close a new round of funding from sovereign funds in the upcoming weeks. With educational technology companies expanding their footprint in coaching hotspots in Kota and other Indian cities, the company is also planning to add 10,000 teachers to its present strength of 20,000 in 2023. This is a result of the heightened market rivalry.
Byju’s is also updating its sales strategy to emphasize inside sales through the use of video calling platforms, which will improve customer satisfaction and lower operating expenses. The creation of numerous inside sales hubs throughout India will now allow Byju’s sales representatives to contact inbound leads via phone calls, emails, and Zoom meetings. Inside sales should reduce business expenses.
Many start-ups worldwide have made staff reductions, reduced operating expenses, and shifted their attention to profitability as the start-up ecosystem experiences a funding slowdown. This tendency has had a significant negative influence on K12-focused edtech companies in India, with big companies like Vedantu, Unacademy, and BYJU’S laying off hundreds of people.
In the fiscal year that ended in March 2022, Byju’s invested $2.5 billion in the acquisition of businesses like Aakash, the American company Epic, the children’s coding platform Tynker, the business of professional education Great Learning, and the exam fraud platform Toppr.
The Indian startup has taken steps in recent months to pay off its loans and other obligations. According to an earlier TechCrunch article, it recently paid the $234 million it owed Blackstone for the $1 billion purchase of Aakash, clearing all outstanding debts. By the conclusion of the current fiscal year, the firm, which reported a net loss of $577.4 million, hopes to turn a profit. According to Divya Gokulnath, a co-founder of Byju, the company will start concentrating on establishing brand awareness abroad through new collaborations and hiring 10,000 teachers for both its Indian and international operations.
“By adhering to a plan that we have developed, we anticipate reaching our goals in terms of financial well-being by March 2023. We have significantly increased brand recognition in India, and there is still room to improve marketing budget management and prioritize spending such that it leaves a worldwide impact. The integration of several business divisions comes in second and operational costs come in the third “said Gokulnath.
“Within the next six months, India will likely account for 50% of all new hiring. If you can speak either English or Spanish, you can enrol. The US and India will both supply the teachers. Additionally, we are considering extending to Latin America “said Gokulnath.
She claimed that the company would build on its relationships with well-known brands like Fifa and that its new alliance would emphasize communicating the value addition that the business provides in terms of learning. As the nation’s most valued startup on Wednesday finally filed audited financial records after months of delay, Byju’s reported a loss of Rs 4,588 crore for the fiscal year that ended on March 31, 2021, 19 times greater than the prior year. The losses for the 2020-21 fiscal year were higher than the last year’s losses of Rs 231.69 crores. Sales fell from Rs 2,511 crores in FY20 to Rs 2,428 crores in FY21.
Edited by Prakriti Arora
