Byju’s Layoff 1,000 Employees Amid Legal Battle with US Lenders

Indian edtech giant Byju’s has recently undergone a restructuring process, leading to the layoff of approximately 1,000 employees across various departments. This decision comes as the company faces a legal battle with US lenders over a USD 1 billion term loan B. Despite the layoffs, Byju’s maintains a total headcount of around 50,000 due to the addition of new employees. The move is seen as part of the company’s cost optimization strategy and its commitment to achieving profitability by March 2023.

Byju’s, a renowned startup founded in 2011, has become one of India’s largest edtech platforms, attracting significant investments from global players such as General Atlantic, BlackRock, and Sequoia Capital. However, in recent months, the company has encountered both legal and financial challenges.

The latest round of layoffs, affecting 1,000 employees, occurred on June 16 and primarily impacted teams related to the platform, brand, marketing, business, product, and technology. These employees were reportedly informed about their termination through in-person meetings and phone calls.

Byju’s had previously initiated a workforce reduction, letting go of 5% of its staff (around 2,500 employees) over the past six months, starting from October 2022. This action was part of the company’s plan to achieve profitability by March 2023.

Byju Raveendran, the founder and CEO of Byju’s, had assured employees in October that there would be no further layoffs beyond the initially planned 2,500 staff. However, the recent layoffs demonstrate the company’s ongoing efforts to optimize costs and streamline operations.

In addition to the workforce reduction, Byju’s has been dealing with legal and financial setbacks. BlackRock, one of its investors, significantly devalued the company’s worth to $8.2 billion, representing a decline of over 60% from its peak valuation. Earlier in March, BlackRock had already marked down Byju’s value to $11 billion. Meanwhile, Byju’s is currently engaged in a legal dispute with creditors in the US who are demanding early repayment of a $1.2 billion loan.

Byju’s, an edtech giant in India, has made the difficult decision to lay off 1,000 employees as part of its ongoing restructuring process. The company’s focus on cost optimization and profitability targets has prompted these measures, despite the addition of new employees to its workforce. Concurrently, Byju’s faces challenges on both legal and financial fronts, including a legal battle with US lenders over loan repayment and a significant devaluation by one of its investors. These recent developments have put the spotlight on the company’s future prospects and its ability to navigate these obstacles successfully.

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