Byju Raveendran, founder of Byju’s, blamed his investors for the edtech icon’s meltdown and throwing him under the bus, asserting they had aggressively backed him during its era of expansion and acquisitions, but “run away” at the first sign of trouble.
Raveendran, who spoke to media for the first time since all the financial troubles began, expressed regret over investors ditching the startup in the face of ongoing challenges.
“Investors were asking for that (a change in management) without a plan," Raveendran told journalists from his residence in Dubai. “Since the markets turned in December 2021, the only people who have been putting money in the company is us,” he added, insisting he was still the best hope for the startup.
Raveendran pointed out that “some investors — including Prosus — have not invested anything in 4-5 years”.
During a virtual press conference, while sounding optimistic of a turnaround, said Byju’s worth today is zero.
Prosus have written off their investment in the once-the-most-valued Indian startup.
“When the US lenders called a default and filed in the Delaware court, within two weeks, all three directors resigned. Those three board members resigning together... is what made it almost impossible for us to do any more fundraising or equity raising. Even if they wanted to resign, if a transition or a vote for reconstitution had been planned, the company wouldn’t be in the situation it is today,” Raveendran said.
Raveendran said that the $1.2 billion term loan secured from US lenders was used for both organic and inorganic international growth, including several smaller global acquisitions. “I thought we made the best decision in the world when we took the Term Loan B (TLB). It was the easiest capital, but it became the most expensive one,” he added.
“Everything started with the liquidity crunch…while we were still half way through most of our acquisitions,” he said while highlighting that the global financial environment began to change, with the Federal Reserve planning to halt its bond-buying programme ahead of raising interest rates.
Raveendran, who lives in Dubai, said he plans to come back to India but his hands are tied on India operations till online litigations are underway.
“I have been on the edge so many times. For me, it’s a mission, not a business. I will make a comeback, and nobody can stop me from completing my mission,” he said.
Raveendran also asserted that there is no fraud in the company. “We have not made any intentional mistakes. We have never siphoned off money. There is no fraud. If there were fraud, the founders would take money out, but we have reinvested our money back into the company,” he added.
Byju’s troubles so far
In February, Byju’s top investors such as Sofina, Peak XV, Prosus and General Atlantic had moved court to oust Raveendran citing mismanagement and oppression of minority rights. Since then, the company has been admitted into bankruptcy.
The insolvency proceedings against Byju's began in June 2024 after the BCCI alleged that Byju’s defaulted on a payment of Rs 158.9 crore related to a sponsorship deal. US-based financial creditor Glas Trust had objected to the settlement between Byju’s and the BCCI, claiming that the money was “tainted” and had been misappropriated from them.
As of September 26, 2024, the Supreme Court of India has reserved its judgment on a petition challenging the NCLAT’s decision to allow a settlement and the verdict on whether the firm will undergo restructuring or liquidation is awaited.
In a separate proceeding, a group of investors including General Atlantic Singapore TL Pte Ltd, Peak XV Partners Investments IV, Sofina SA and MIH Edtech Investments have moved the Supreme Court, alleging violation of law and corporate governance norms and mismanagement by the founders in managing company affairs.