In a significant move signalling the end of the prosperous era in 2021, Raveendran, Byju’s founder, has pledged assets valued at around Rs 100 crore, including an under-construction villa and family homes. The decision, driven by the edtech major’s financial strain, aims to meet salary obligations for a portion of its workforce.
The move suggests anticipation of fresh funds and underscores his commitment to staff morale amid the current cash crisis.
Following the salary settlement, Raveendran addressed senior executives in a conference call, expressing regret over the lack of adequate capital. He also highlighted the challenges posed by the $1.2-billion Term Loan B (TLB), a consequence of delayed audits and demands for a full refund from lenders.
The TLB, obtained during the peak of Byju’s growth in 2021 to support acquisitions, lies at the core of the ongoing crisis. With the company spending close to $3 billion on acquisitions in 2020–21, it found itself entangled in the consequences of its high-risk strategy as growth slowed post pandemic.
Recently, the edtech platform shortened the required notice period for its employees. The move was aimed to manage its working capital shortage.
The decision included employees across all levels, including executives, associates, specialists, senior executives, senior associates, senior specialists and team leads.
Previously, the notice period for seniority level ranged from 30 to 60 days, which was reduced to 15 days. Similarly, Level 4 employees, including assistant managers and above, were asked to serve a notice period of 30 days, as opposed to the previous possibility of up to 60 days depending on the role.
The decision was taken to establish uniformity in the company’s policies, while also standardising the notice period across all levels. Additionally, the decision to pledge homes adds further scrutiny to the brand’s perception.