Byju’s plans to raise $500-600 million from Abu Dhabi’s sovereign wealth funds and existing investors, sources say, as the start-up world faces a funding freeze. The educational technology (edtech) giant is aiming for profitability by March next year. “There is no change in Byju’s assessment. The new fundraising process is still ongoing,” a person familiar with the matter said. “Any new valuation would be determined in the future as it is very difficult for investors to do so in this environment.”
Byju’s did not respond to questions about the company’s fundraising plans.
In its most recent funding round, the company raised $250 million from the Qatar Investment Authority (QIA) and existing investors. The company’s valuation had remained static at $22 billion. Byju’s raised $800 million in a funding round last March, with founder and CEO Byju Raveendran contributing half. Raveendran was in talks with various international and domestic banks to raise $400 million in a loan to fund 50% of the $800 million funding round, according to people familiar with the development.
The Bengaluru-based company recently announced plans to lay off nearly 2,500 people, or 5% of its workforce as part of an “optimization” campaign.
The edtech company recorded losses of Rs 4,588 crore for 2020-21 (FY21), 19 times more than the previous year, according to its latest financial report. The business had revenue of Rs 2,428 crore in FY21. Its adjusted revenue for FY20 was Rs 2,511 crore with the adjusted loss amounting to Rs 300 crore. rupees.
Raveendran had previously said that the company was in an ideal situation in terms of growth, where unit economics and economies of scale were both in its favor. This meant that the capital the company would invest in its business would result in profitable growth and create lasting social impact, he added. The business has now set out on a path to group-level profitability by March next year with a three-pronged approach.
It consolidates K10 subsidiaries – Meritnation, TutorVista, Scholar and HashLearn – under the India business unit. The other acquisitions Aakash and Great Learning would operate separately. The company is also realigning its marketing spend to strengthen its global footprint.
The company also plans to hire 10,000 teachers over the next six months, adding to the current staff of 20,000 teachers. The company is also expanding its teams, in addition to hiring senior executives, to further strengthen its operational strength.
The company said it has already started to focus on profitable growth. He said revenue of $2 billion was within sight of the business and the company’s revenue for FY22 was nearly Rs 10,000 crore or Rs 1.3 billion. dollars.