It may be a funding winter for startups but the news around the biggest of them all; Byju's is giving onlookers chills. From hundreds being fired from recently acquired units to a delay in a billion-dollar payment, the next chapter in Byju's success story is a cautionary tale.
At $22 billion Byju's is India's most valued startup and the edtech giant has been on a warpath of acquisitions which are now proving to be a painpoint.
News of delayed payment set-off alarms on cash flow issues for the Bangalore based startup. Reports indicate that Byju’s asked for extending the deadline for making parts of the payments for a ~$1 billion acquisition of Aakash, a 34-year-old chain of physical coaching centres, it announced over a year ago.
But having spent $2.5 billon on acquisitions, Akash's deal is not the only one that turning to be a bother reportedly. In one week alone, units acquired by Byju's have fired over 1500 employees as per media reports. From coding platform WhiteHat Jr and exam-prep platform Toppr (both pandemic buys for Byju's) the layoffs have been sudden and largescale. The company has maintained, this is a 'restructuring' not a cost cutting and also disputed the number of employees affected.
Byjus is not alone in the sacking spree, 30 startups in 6 months have let go of over 10,000 employees in India.