The embattled edtech giant, Byju’s, is navigating a turbulent period as a group of investors, including Prosus Ventures holding a significant 9 per cent stake, calls for the removal of founder and CEO Byju Raveendran. The demand for leadership change is fueled by deep concerns over the company’s stability amid an unprecedented crisis.
In a statement released on Friday, Byju’s defended its founder, asserting that the dissenting investors lack the necessary voting rights to enforce a change in leadership. The internal strife underscores a broader conflict within the edtech firm, with shareholders expressing worries about the company’s future trajectory under the current leadership.
Prosus Ventures, supported by unnamed fellow shareholders, issued the call for Raveendran’s removal, citing concerns related to governance, management, compliance issues, and a desire to reconstitute the board to diminish founder control. This move follows a series of setbacks for Byju’s, including the resignation of Deloitte as its auditor last year, citing a failure to provide essential documents.
About Byju’s Edtech Firm Faces Turmoil:
The edtech company further faced challenges with delayed financial statements for the year ending March 31, 2022. Notably, board members representing Peak XV, Prosus, and the Chan Zuckerberg Initiative resigned from Byju’s board in the previous year, highlighting the internal discord.
Byju Raveendran responded to the mounting pressure in a letter to shareholders, emphasizing the importance of a swift capital raise. He outlined plans to utilize the raised capital for business operations, managing obligations, and enhancing sustainability. Despite these assurances, Byju’s valuation has reportedly plummeted to an estimated range of $1 billion to $3 billion, according to some investors.
As the edtech industry continues to evolve, the challenges faced by Byju’s underscore the delicate balance between maintaining founder influence and responding to investor concerns. The outcome of this internal struggle will undoubtedly shape the future trajectory of one of India’s leading edtech firms. Investors and industry observers keenly await the resolution of this unprecedented crisis at Byju’s.