Byju Raveendran’s Byju’s, India’s highest valued startup and torchbearer of the Indian edtech space, has parted ways with over 2000 employees across a couple of its acquired entities and its own business, reports MoneyControl. It has also delayed payments for it’s $950 Mn cash-and-stock acquisition of the 34 year old offline entrance exam coaching institution, Aakash Education Services Ltd.(AESL)
The payments for the deal, which was finalized in April 2021, were supposed to be squared off till June 2022. However, a company spokesperson has refused to acknowledge the company’s pushback as a delay, saying August 2022 was the “agreed-upon” deadline for the deal. “Aakash is our most successful acquisition till date, and we are very proud to have them in our fold. The acquisition process of Aakash is fully on track and all payments are expected to be completed by the agreed upon date – August 2022,” the spokesperson said.
The spokesperson further added “Along with all our group companies, we continue to be perfectly poised to provide access to quality education in all learning segments from early learning to exam prep and career success.”
The layoffs occurred in Toppr, a startup acquired by Byju’s last year, which laid off 300 employees. The second half of these job cuts came from Whitehat Jr., an early age coding platform, which also fired 300 employees. Byju’s commented on the layoffs at Toppr, claiming the company had “completed the integration of Toppr and has absorbed almost 80% of its talented workforce into the Byju’s ecosystem.” The statement added “As the next step, we are optimizing teams to recalibrate business priorities and accelerate our long-term growth.”
The Bengaluru-based Byju’s, valued at a staggering $22 Bn, has been on an acquisition spree ever since startup funding in India peaked last year. The company has spent a total $2.5 Bn in acquisitions of over the last 18 months. The acquisition of Aakash has helped the company to establish a strong presence in the unimaginably massive offline entrance exam coaching market, which has largely been dominated by AESL and Allen Coaching Institutes.
The acquisition also puts at Byju’s’ disposal the top tier infrastructure, staff and teachers in Aakash’s arsenal. (Some of these teachers are actual celebrities in the senior secondary student community). Byju’s has earlier discussed plans of infusing another $200 Mn in 200 coaching centres, with a goal to eventually cater to students from 4th to 10th grade as well.
Byju’s, dispite the recent funding crunch in the Indian startup space, has had no shortage of funding. The company raised $1.7 bn in equity funding last year. As it turns out, in these times of a raging fire of layoffs across all sectors, Byju’s isn’t spared. Recently, rival edtech Unacademy also had mass layoffs, shortly after a $440 Mn funding round.