In a sign of the intensifying funding winter and challenging macroeconomic conditions, edtech major Byju’s got its valuation marked down by yet another investor, by a massive 62% in the quarter ending March 2023. From the looks of it, US-based asset management company Blackrock cut the valuation of its holding in the Indian edtech startup in the quarter to about $8.4 billion, marking the second occurrence of such an instance.
Currently, Blackrock is a minority investor in Byju’s – holding a 0.9% stake in the startup. Now, it pegged the value of its 2,279 shares in the company at $4,043,471. This in turn, effectively estimates Byju’s fair value at $8.4 billion, as of March 31, 2023, and comes at a time when Byju’s is fighting battles across business, governance and financing front.
This recent mark down comes after Blackrock slashed Byju’s valuation just last month. At that time, it slashed its valuation by about 50%, ensuring that it dropped to $11.5 billion. Byju’s declined from responding on queries on the matter.
Byju’s, founded by Byju Raveendran in 2011, has emerged as a leading player in the Indian edtech sector. The company offers a comprehensive digital learning platform that combines engaging content and innovative teaching methods to provide personalized education to students. Byju’s has made some noteworthy investments and acquisitions – including Aakash Educational Services two years ago – and garnered significant attention and investor interest, becoming one of the most valuable start-ups in the world.
Nonetheless, as the pandemic-induced surge in demand for online education subsides, investors are scrutinizing the long-term sustainability and profitability of edtech businesses, and are tightening their purse strings amidst worsening macroeconomic conditions in the market. With private investors adjusting their expectations and risk assessments accordingly, this reassessment has led to a correction in valuations of several major startups. Meesho falls within this list, whose valuation was recently slashed by Fidelity Investments by 10%. Janus Henderson, as another example, cut the valuation of PharmEasy by 50% to $2.8 billion earlier this month. And around the same time, Invesco cut the valuation of Swiggy for the second time this year, reducing it by less than half to $5.5 billion.
Byju’s recently bagged a total of $250 million in a fresh round of debt funding through structured investments.