Credits: Wikimedia commons

Earlier this year, edtech decacorn Byju’s announced the closure of its $800-million investment round, which was part of its funding efforts before it went public. It can thus be expected that four months down the line, the online education provider has raked in the capital to continue its shopping spree across markets.

However, this is not to be, as it is yet to receive $250 million out of the $800 million that made up the investment round in March. It seems that its investors – global tech fund Sumeru Ventures and Oxshott, a fresh face in the crowd – have not transferred the $250 million to Byju’s (yet).  This was found as one of Byju’s investors initiated a probe through corporate investigation and risk consulting firm Kroll. The same found “serious discrepancies with Sumeru Ventures,” something that effectively “derailed the entire investment.”

According to a Byju’s spokesperson, the investors are yet to transfer the committed amounts because of “macroeconomic reasons,” and that it was expected that the $250 million-sized hole would be filled by the end of next month.

That this development comes at current times is hardly surprising, and the “macroeconomic reasons” can be guessed at. Globally economy is facing headwinds that economists say were last seen only during The Great Depression, and startups, particularly cash-guzzling late stage ones, are feeling severe heat. Some of the biggest names in late stage VC investing, such as Sequoia, Softbank among others have already announced planned pull-back on late stage checks. Moreover, startup business models have, for a very long time, never taken profitability as a key metric, resulting in humongous losses and steep valuations. All of that has been due for correction, and startups are learning it the hard way during the current global economic turmoil.

Speaking on the rest of the capital, Byju’s founder Byju Raveendran has already put $400 million into his edtech behemoth – effectively making up 50% of the multi-million dollar round.

Once all the capital has been gathered by Byju’s, the edtech decacorn will be valued at a humongous $22 billion. This puts it far ahead of other Indian startups in India, such as Zomato and Swiggy and helps it maintain the title of the highest-valued startup in the country.

This has seen them resort to measures such as laying off employees (like Byju’s has done). It is, however, hardly good news and increases headaches for firms and investors alike, and may be an obstacle to Byju’s goal to raise $1 billion to continue its acquisition spree.