Byju says firm's $22 billion valuation intact, accepts past mistakes

In hot water for crises at Byju’s, CEO Byju Raveendran in a meeting with shareholders admitted to past mistakes but assured that his learnings far outweighed any misstep, according to people in the know. He also stressed that the valuation of the company was intact at $22 billion.

In the meeting with nearly 75 shareholders on Saturday, Raveendran highlighted his personal investments in the company, including $400 million in the parent company, $250 million for the Aakash acquisition, and an additional $250 million through pledged secondary shares in last funding round. “He also mentioned that all the secondaries done has been invested back in the company at $22 billion valuation,” said a source.

Raveendran, the sources said, claimed his unwavering dedication to the edtech firm, saying “Byju’s is not my work; it is my life.”

He said all Byju’s processes would be strengthened with the assistance of newly appointed CFO Ajay Goel and general counsel Roshan Thomas.

The latest crisis at Byju’s was triggered by the resignation of its statutory auditor Deloitte Haskins & Sells over delays in the edtech start-up’s financial statements. This was followed by the resignation of three board members from Prosus, Peak XV Partners, and Chang Zuckerberg Initiative.

The board members, who have resigned also were present at the meeting; they shared their reasons for resignation, even as Raveendran told the attendees that the company was yet to accept their resignation.

“While the board members (those who resigned) expressed gratitude towards Deloitte, they mentioned that the auditor had been causing delays and complications in Byju’s results,” said one of the sources.

An e-mail sent to Deloitte remained unanswered. 

Deloitte, in its resignation letter to the shareholder, stated that financial statements of the company for the year ended March 31, 2022, were long delayed. “We have also not received any communication on the resolution of the audit report statements and the underlying books and records for the year March 31, 2022, and we have not been able to commence audit as on date,” said the letter.

The source further said: “All the three resigned board members, too, were on the call; they assured shareholders that they will work with the company during the transition.”

Raveendran told the shareholders that discussions were on for several weeks regarding the reconstitution of the board to strengthen processes.

Ajay, group CFO, shared the timeline for the financial results. According to sources, Goel committed to closing the audit for FY22 by the end of September and the audit for FY23 by the end of December. “He updated the shareholders that the audit for most subsidiaries for FY22 had been completed,” added the source.

Thomas, group General Counsel, assured the shareholders that on the Term Loan B issue (the $1.2 billion loan case in the US), constructive negotiations were going on, and the company was hopeful for a quick resolution.