Byju Raveendran plans to return to edtech with new avatar

The indomitable Byju Raveendran on Thursday said his investors were not blameless for the edtech icon’s collapse, claiming they actively supported him during its era of expansion and acquisitions but “all ran away” at the first sign of trouble.

“Investors are demanding (management changes) without a plan. Since the market turned in December 2021, the only people who have put money into the company are us,” Ravindran told reporters at his residence in Dubai. The company The founder of an edtech company says he insists he remains the startup’s best hope. He was answering a question about whether, in hindsight, he should have given up control of the company to save its value.

In February this year, Byju’s top investors such as Sofina, Peak XV, Prosus and General Atlantic had filed a court case to oust Raveendran on the grounds of mismanagement and oppression of minority rights. The company has since declared bankruptcy.

There was no immediate response from the investment consortium. MintComments were sought Thursday evening.

“Investors don’t care about students or parents, they just want me to build a $100 billion company,” he said.

The “escape” statement is untrue

Ravindran was speaking to reporters at his residence in Dubai. He disagreed with suggestions that he had “fleeed” to Dubai and claimed that he would return to India after the court trial to start another edtech company, which he would run at “half the cost.”

Ravindran said he moved to Dubai for his father’s treatment. Regarding his personal life situation, he said that after giving birth to two boys, he is now the father of a four-month-old baby girl. He described his mindset as “positive” and said he’s still excited about returning to teaching. His greatest skill is that he can change a student’s mind in five minutes – “about how they think about learning.”

He said every decision taken by Byju’s is taken with the consent of all investors.

“The biggest encouragement I received for the acquisition came from Whitehat Jr., and conversely, the biggest resistance I received from the board was the acquisition of Aakash,” Raveendran said. For context, Aakash is now seen as the only shining star in Byju’s 26 acquisitions. Whitehat Jr. was one of its first failed acquisitions.

Raveendran said if he had enlisted the help of experienced investors like Mohandas Pai from the beginning, he might not have made the mistake.

“We overestimated the potential growth… As a pioneer in this industry globally, we entered many markets together,” said Raveendran, who believes Byju’s downfall was largely due to market timing and the debt the company took on.

Byju’s is facing multiple lawsuits from lenders and investors. The lender has sought repayment of a $1.2 billion loan he took out in November 2021. Investors have sought to retain their rights in Think & Learn, while investors including the Qatar Investment Authority have sought court rulings seeking details of Raveendran’s personal assets.

Raveendran went on to claim that while the value of parent company Think & Learn has now dropped to zero, Byju’s 26 subsidiaries, including Aakash Education Services and Great Learning, have cumulatively reported $Even now, the ARR is Rs 5,500 crore. Mint This cannot be independently verified. At the peak of business in 2021, the company claims to achieve $It has revenue of Rs 10,000 crore and has over 85,000 employees, including teachers on the platform.

Career landing

Ravindran acknowledged for the first time since the crisis erupted at the company that was once valued at $22 billion that core business has now dropped to zero. “Right now, there is no revenue coming from the core business,” he said.

According to him, taking into account the revenue of its various subsidiaries, the combined figures add up to more than $50 billion rupees. “Student enrollments at these subsidiaries have been growing and are running well,” he added.

Claiming that he will make a comeback, Ravindran said that even if people turn off Think and Learn, he will still find ways to teach.

Calling it a relaunch and renaissance effort, Raveendran said the founders intend to stay in the edtech industry and possibly bounce back with a different image.

Regarding Aakash’s shareholding, Raveendran seemed to say that while Manipal Group founder Ranjan Pai owns 40% of the shares, the remaining 60% is held by parent company Think and Learn Pvt. Ltd.

To be clear, the Aakash deal still has contractual milestones to be reached.

Raveendran also said that this will happen only after the final tranche of shares is exchanged between Blackstone and the Chaudhary family. While the Chaudhry family still holds an 18% stake in Aakash, Blackstone Group still holds a 12% stake.

missing money

He said the $533 million that was at the center of the argument for the edtech giant has fully offset expenses the company may incur over the next two years. “The funds were used as security for the payment commitments we made,” Raveendran said, explaining how the funds were exhausted and therefore outside the scope of the Term Loan B (TLB) lenders.

In documents filed with a U.S. court last week, Raveendran confirmed that the $533 million could not be made available to TLB lenders because it had been committed to future expenditures, contrary to its previous position that the money was safely held overseas.

Auditor resigns:

Ignoring the allegations raised by Deloitte India when it resigned as Byju’s statutory auditor in June 2023, Raveendran said it was a collective and conscious decision by the company not to grant access to Deloitte. The review could not be completed within the stipulated time. “We don’t want them to start a review because it took them an extra 12 months the first time. So, it’s a mutual decision by everyone,” Ravindran said.

Its second auditor, BDO, also resigned earlier this year, citing financial and governance concerns.