Byju’s, one of India’s biggest EdTech firms has been in the news for all the wrong reasons of latedue to a slew of problems involving its finances, unpaid debts, governance, and layoffs
What is Byju’s?
Byju’s (or BYJU’S) is a global Indian educational technology firm located in Bangalore, Karnataka, India. Launched in 2011, by Byju Raveendran and Divya Gokulnath, it was valued at US$22 billion in March 2022 but has since dropped to US$8.5 billion as of June 2023. The firm claims to have over 150 million enrolled students as of April 2023. It was always a successful ed-tech firm however the real impetus came when they launched the BYJU’S App for Kids as well as the Byju’s Parent Connect app. By 2018, it had 15 million users, with 900,000 of them being paying subscribers. Byju’s became India’s first EdTech unicorn the same year. By 2019, 60% of BYJU students were from non-metropolitan and rural areas. Since January 2022, the firm is a part of IAMAI’s India EdTech Consortium as a founding member along with Simplilearn, Unacademy, upGrad, PrepInsta Prime, and Vedantu
What is the issue with Byju’s?
Byju’s, had a disastrous 2022 due to a slew of problems involving its finances, unpaid debts, governance, and layoffs, among other things. BYJU’s woes come as a result of dismissing staff, an alleged harsh and “abusive” work culture, and accusations of a “working capital crisis,” with lenders demanding the EdTech return a portion of its loan. Customers who claim they were taken advantage of by Byju’s, are posting variety of grievances on social media platforms and consumer websites, endangering their finances and prospects. Byju’s clients, some of whom were from low-income homes, spoke to Context about how salespeople aggressively pursue them, pressuring some of them into paying for courses or duping them into taking out loans before leaving them out of cash.
Byjus Layoffs
By 2022, Byju’s said that it will eliminate 5% of its workforce, or 2,500 people, as part of a “optimization” plan. To reduce redundancy and duplication of responsibilities, and to better leverage technology, roughly 5% of Byju’s 50,000-strong workforce was scheduled to be phased out across product, content, media, and technology departments. Byju’s, now has begun another round of 1,000 workers in a new round of layoffs across divisions. The current wave brings the overall number of job cutbacks at the organization to roughly 3,500. According to reports, the company’s new employment layoffs are an attempt to strengthen its finances and move toward profitability. The most recent round of layoffs at the EdTech company comes at a time when the company is in a legal dispute with its creditors in a court in the United States and has not made an interest payment of $40 million on a Term B loan worth $1.2 billion.
Is BYJUS Shutting down its subsidiary firms?
The education technology giant BYJU’s purchased the fledgling company WhiteHat Jr. for the sum of $300 million in the year 2020. We have no intention of closing it down at this time. “We are merely optimizing it for organic and efficient growth,” a spokesman for BYJU’s stated in response to claims that the education technology giant has been in discussions in recent weeks about closing down the coding platform. Reports have been coming that the company is in negotiations about closing down the platform. A little over a year ago, the e-learning firm terminated the employment of roughly 300 people. Additionally, more than 800 workers at WhiteHat Jr. quit between March and April of the previous year after being told they needed to ‘work from the office’.
Should parents start to worry?
Now that the chances of the company shutting off some courses like Whitehat Jr loom large, the parents are bound to get worried. There have been reports of numerous complaints by aggrieved parents in the past of zero customer support regarding course modifications and cancellations. However, parents should not get too disappointed and depressed as it may severely affect the student who might be in the middle of a course. The company as of now has given no formal notifications for discontinuing any course or closing any subsidiary venture. Now that they are already enrolled in the course, they should encourage the student to take as much advantage of the course material as possible but at the same time, students should also develop a habit of online self-learning where there is an abundance of online materials, books, videos available free of cost for understanding almost any typical concept.
Change needed in the mindset of Parents
This faulty mentality of considering kids incapable of learning on their own is also tremendously demoralizing. Parents have come to a point where they see coaching as essential, despite the fact that it isn’t really necessary. The growing number of mushroom coaching centers in India only adds to parents’ concerns that if their children are not spending at least six hours a day inside an already overcrowded classroom (in addition to roughly eight hours of school), they will fall behind academically. However, students should not spend any time outside of school attending extracurricular activities simply because their peers are doing so. It’s not that taking assistance is wrong, but the notion that one should do something just because other parents are doing it is incorrect. The sheer agony of falling behind many prompts only to tire out, sitting in class after class, when they should engage in extracurricular activities, broadening their interests, Holidays, and Travels, all that is outside the classroom, and seeing if they’re passionate about things that cannot or will not be taught in class.
What do you think?