‘All this was created by only one mistake’: BYJU’s CEO Byju Raveendran opens up on collapse from $22 billion to near insolvency

New Delhi: The founder of the beleaguered edtech company BYJU’S Byju Raveendran has opened up about the circumstances that led to fall of his once highly successful venture. Byju Raveendran admitted that his company made mistakes in its business decisions as it tried to expand too quickly to 21 countries and this hurry was primarily driven by pressure from prominent investors.

BYJU’s was once a high-valued edtech firm worth $22 billion which faced a significant decline due to financial challenges, regulatory hurdles, and legal disputes. BYJU’s CEO also acknowledged a lapse in strategy as he said that the decision to secure a $1.2 billion term loan instead of utilising available equity options left the company vulnerable to external pressures.

“The only mistake, which created all this, is that we shouldn’t have taken this, when we had enough equity options, we shouldn’t have taken this term loan at that time in 2021. Rs 1 billion because we had other options. We have raised 5 billion before that. So it’s not, we were not doing it out of desperation. Now it was all a collective decision,” he said in an exclusive interview with news agency ANI.

“When we tried expanding from India to the whole world, we made some business mistakes. Maybe we could have taken it a little bit slowly. We were growing a little too soon, too fast. We went from India to 21 new countries. But if you ask me, in that context of 2019 to 2021, the COVID era. We have 160 investors, world-class investors, and equity investors,” said Raveendran adding that external macro factors, such as the Russia-Ukraine war resulted in major investors going back on promised investments which had a considerable impact on the company’s expansion and acquisition strategies.

“We were raising money for growth at that time. But when the world changed when interest rates went up, when Fed increased the interest rate and, almost simultaneously, the big war started, Russia and Ukraine, suddenly the liquidity dried up. 700 million of committed capital; signed committed capital didn’t turn up,” he said.

“It’s a lost opportunity for India. My idea was to create a million teaching jobs. Now you can say, Oh, that’s such a big ambition. We were just starting. We were at its peak as a tool. We created almost 40,000 teaching jobs. And then there was one more thing. Like what mistake we made when we created 2.15 lakh jobs for fresh graduates which is just for the greed of a few random vulture lenders in the US,” he said.

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