Byju’s Faces Another Setback as Three Directors Confirm Resignations
Written by Sanjay Kumar
BYJU’S
Educational technology company
- Founders: Byju Raveendran, DivyaGokulnath
- Subsidiaries: Byju’s Exam Prep, WhiteHat Education Technology, MORE
- Founded: 2011
- Revenue: 2,280 crores INR (US$290 million, 2021)
- Headquarters: Bengaluru, Karnataka, India
Despite facing lender and regulatory scrutiny, the beleaguered edtech giant, Byju’s, received confirmation of the resignations of three directors representing key investors, contradicting the company’s denial.
Peak XV Partners’ GV Ravishankar, Prosus’ Russell Dreisenstock and Chan Zuckerberg Initiative’s Vivian Wu have stepped down from the board of Byju’s parent Think & Learn Pvt., according to their spokespersons.
A spokesperson from Peak XV Partners, formerly known as Sequoia Capital India and Southeast Asia, stated, “We are committed to supporting the company in bringing on board an independent director in order to strengthen business processes and internal control mechanisms.”
Byju’s had previously refuted media reports regarding the resignations, dismissing them as entirely speculative. However, the company has now acknowledged that discussions with investors are underway to reconstitute the board, including the induction of independent directors.
Explaining the need for board reconstitution, a Byju’s spokesperson said, “The need for reconstitution arose as few investors had to vacate the board seat due to their shareholding falling below a minimum required threshold as per our shareholding agreement. We want to reassure all stakeholders that we are actively working towards constituting a diverse and world-class board commensurate with the company’s size and scale.”
These resignations add to the growing list of challenges faced by Byju’s over the past year. The company has encountered searches by the Enforcement Directorate, valuation cuts by prominent investors, a legal battle with lenders over repayment terms, layoffs, delayed financial results, and funding issues. Furthermore, its auditor, Deloitte Haskins & Sells, resigned citing “long delayed” financial statements.
Byju’s has been embroiled in various controversies, significantly impacting its reputation. The delay in announcing its FY20-21 results, which finally occurred in September 2022 after an 18-month delay, marked the beginning of a turbulent period for the company. Subsequently, Byju’s faced challenges such as the dispute with its $1.2 billion term loan B (TLB) lenders, raids by the Enforcement Directorate (ED), the absence of a timeline for FY21-22 results, funding difficulties for verticals like coding unit Whitehat Jr., and more.
As Byju’s navigates these difficulties, stakeholders remain keenly observant of the company’s efforts to reconstitute its board and address the pressing issues at hand.
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