Byju's valuation dips from $22 bn to $3 bn

Chennai: Once the most promising startup in the ed-tech space, Byju’s has seen its valuation being slashed to $3 billion by its investor Prosus against $22 billion in October 2022.

This is the second time in a year that Prosus has downgraded Byju's valuation. Byju's was last officially valued at over $22 billion in October 2022, when it raised a $250 million funding round. In November last year, Prosus first slashed the fair value of Byju's to $5.97 billion and now to $3 billion.

In July, Prosus’ representative on Byju’s board, Russell Dreisenstock stepped down from the company. Prosus stated that Byju’s had poor reporting and governance structures.

Following delayed financial results, and the resignation of its auditor, Deloitte, Byju’s saw several board members exiting. Along with Dreisenstock, Chan Zuckerberg Initiative’s Vivian Wu and Peak XV Partners (Sequoia Capital India)’s GV Ravishankar also stepped down in July. Earlier in November, Manipal Group chairman Ranjan Pai bought out the debt investment by the US Hedge Fund Davidson Kempner in a Rs 1,400-crore deal. According to reports, Ranjan Pai has extended around Rs 250 crore in fresh funding.

In September, Byju's submitted a proposal to its lenders, expressing its intention to fully repay its $1.2 billion term loan B within the upcoming six months. Byju's wants to make an initial payment of $300 million within the next three months.

Reports say that Byju’s needs around $120-130 million in fresh financing in the next couple of months to run operations. Byju’s investors want audited results for FY23 to be furnished before they extend any new money to the company. Apart from cost-cutting, Byju’s has put the up-skilling platform Great Learning and book reading platform Epic up for sale, which may yield the company about $1 billion.

Byju Raveendran and his family has around 25 per cent stake in Think and Learn, which owns Byju’s, and 27 per cent stake in Akash Institute.