Byju Raveendran, the creator of edtech giant Byju’s, is in negotiations to increase his ownership stake to almost 40%. Raveendran is in discussions to raise funds by using the shares as security to finance the buyback of an estimated 15% of the company.
The buyback may occur at a lower valuation, even though Byju’s was valued at $22 billion when it last raised capital in October 2022.
Though, according to an exclusive report, the discussion with the stakeholders and financiers are still in the initial phase and may not end up to a deal.
The founder of Byju’s has about 25 per cent stake in the country’s most-valued startup and the brand has other prominent investors like Chan Zuckerberg Initiative, Sequoia Capital India, Blackrock, and Silver Lake. According to Tracxn data, Byju’s has till date raised more than $5 billion.
Byju’s had a turbulent year in 2022, which was characterised by several layoffs and criticism over the company’s late filing of its FY21 statistics. Byju’s finally submitted its FY21 figures in September after a delay of nearly 18 months, and it revealed that its net loss increased to ‘4,588 crore from ‘231.69 crore in FY20. The company’s overall annual revenues decreased slightly, by 3.32%, to $2,428.39 crore. Due to the postponement of 40% of income to following years, but not costs, there was a significant increase in losses throughout the year. Then, Raveendran stated that losses would be lower in FY22. He had previously stated that the company had brought in close to ‘10,000 crore in gross revenues for FY22.
In the upcoming quarters, Byju’s had stated that it will concentrate on increasing overall profitability. “As an established company that takes its obligation to stakeholders and investors seriously, we work to achieve sustainable growth in addition to rapid revenue growth. According to Mrinal Mohit, CEO, Byju’s India business, “These steps will enable us to attain profitability in the stated time period of March 2023.”
