The parent business of Byju’s, the beleaguered Think and Learn Pvt Ltd, announced a significant restructuring on Monday. Byju Raveendran, the founder and group CEO, will now take “a more hands-on approach in spearheading the daily operations” of the company. Arjun Mohan, the CEO of Byju’s India division, will leave the firm to take on an external advisory position, providing his “deep edtech expertise to the company and its founders during this transformation phase” concurrently.
In addition to facing severe financial losses, a slew of lawsuits, and a strong response from investors, Byju’s is in desperate need of funding. Due to the company’s declining valuation below $1 billion (around Rs 8,300 crore), some investors are pressing for Raveendran and his family members to be fired.
According to the statement, Raveendran has spent the last four years mainly concentrating on strategic goals including securing funding and promoting international expansion. But, realising the need for strong leadership in this trying time, he will now play a major role in the day-to-day operations of the business, using his knowledge to guide Byju’s into its next stage of expansion and innovation, the company announced on Monday.
Additionally, Byju’s made the decision to streamline business processes and set itself up “for long-term success.” The Learning App, Online Classes & Tuition Centres, and Test-prep are the three targeted segments that Byju’s is combining as part of this strategic change. With the help of the BYJU’S brand and ecosystem, each vertical will be able to take advantage of market opportunities with greater agility, economy, and preparedness thanks to the new structure. According to the corporation, each of these units will have its own leaders who will manage the companies sustainably and profitably on their own.
The modifications come after a comprehensive seven-month operational assessment and cost-cutting initiative headed by Arjun Mohan, the departing CEO of Byju’s India.
Byju Raveendran, Founder and Group CEO, stated, “This reorganisation marks the start of BYJU’S 3.0, a leaner and more agile organisation ready to adapt quickly to evolving market dynamics, especially in the realm of hyper-personalized education.”
A group of investors approved resolutions to remove Raveendran, his brother Riju Raveendran, and his wife Divya Gokulnath from the company’s leadership during an extraordinary general meeting (EGM) in February. The Karnataka High Court is currently debating whether the resolutions are still legitimate. Over the past year, Byju has made significant cost reductions and laid off hundreds of workers, but the company’s valuation has plummeted and it has defaulted on loans from US lenders.
“With three specialised business units, we will focus on our core strengths and continue to pursue profitability while we unlock new growth opportunities.”
Furthermore, Byju’s said on Monday that a majority of 55% of the votes cast in favour of the request for an increase in authorised share capital, which was presented at the March 29 extraordinary general meeting (EGM) and through postal ballot, had been accepted.
Byju’s has the necessary funds thanks to the $200 million rights offering, but the company isn’t able to use the money just yet. On a petition filed by four foreign shareholders, the National business Law Tribunal (NCLT) issued an interim decision directing the business to temporarily place the proceeds from the rights issuance in an escrow account. The matter’s next hearing is set for April 23.
“An independent third party has duly scrutinised the voting process, which included both the EGM and a postal ballot that concluded on April 6, 2024,” according to Buju’s statement.
According to Byju’s, “Think & Learn Pvt Ltd will be able to issue new shares and complete the rights issue in order to address the liquidity crunch, including unpaid salaries, regulatory dues, and vendor payments, as a result of the EGM proposals being approved.” It stated that these delays were caused by the unreasonable animosity of four foreign owners who preferred pointless lawsuits to fruitful negotiations.
“Byju’s is now well-positioned to begin its next chapter of innovation-led growth by launching at scale its new suite of AI-first products that received positive feedback in the pilot phase,” the statement read. “With the new organisational structure and with the return of Byju Raveendran as the operational leader.”
