In 2015, Byju Raveendran, a young engineer from the southern state of Kerala, India, embarked on an ambitious journey with a vision to transform the landscape of education in the country.

Recognizing the challenges faced by stressed teenagers in mastering subjects like math and science, Raveendran conceived the idea of Byju’s – The Learning App, an edutech platform that aimed to make learning engaging and accessible through digital means.

His vision was to leverage online resources to create a platform that not only facilitated academic understanding but also made the learning experience enjoyable for students burdened by the pressures of traditional education.

Byju’s sought to bridge the gap in India’s educational system by offering a dynamic and interactive approach to learning, particularly in the domains of mathematics and science. Raveendran envisioned a platform that would not only cater to academic needs but also address the stress and anxiety prevalent among students preparing for exams.

The use of technology was pivotal in his approach, aiming to harness the power of digital tools to create an immersive and effective learning environment. Byju’s early success can be attributed, in part, to Raveendran’s commitment to revolutionizing education by providing a solution that resonated with the evolving needs of the student community in India.

Ambitious Beginnings With Celebrity Backing

Byju’s embarked on its ambitious journey in 2015, with the vision of transforming math and science education in India. What set it apart initially was the strategic alliance with two global icons – Bollywood superstar Shah Rukh Khan and soccer legend Lionel Messi, who lent their celebrity status as brand ambassadors.

This association not only added credibility to Byju’s but also helped in creating widespread awareness and acceptance among the target demographic – stressed teenagers seeking an engaging approach to learning.

To fuel its expansion, Byju’s leveraged the growing interest in edtech and secured substantial funding from venture capital sources. The injection of funds allowed the company to scale up its operations rapidly, invest in cutting-edge technology, and build a comprehensive platform for online learning.

This financial backing played a pivotal role in Byju’s ability to reach a global audience and position itself as a frontrunner in the edtech industry.

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The COVID-19 pandemic prompted a surge in remote learning worldwide, creating an opportune environment for edtech platforms. Byju’s capitalized on this trend by engaging in a spree of global acquisitions, deploying nearly $3 billion in the process.

These acquisitions were aimed at expanding the company’s reach, acquiring talent, and integrating diverse educational resources into its platform. The strategic move positioned Byju’s as a major player in the rapidly evolving landscape of online education.


Apart from acquisitions, Byju’s directed a significant portion of its funds towards technological advancements. The company sought to enhance the overall learning experience by incorporating interactive content, adaptive learning modules, and personalized learning paths. This technological focus not only attracted users but also aligned with the broader trend of integrating innovation into education during the digital age.

The timing of Byju’s aggressive expansion coincided with a global shift towards remote learning due to the pandemic. The increased demand for online educational solutions created a conducive environment for Byju’s growth, as students and parents sought effective alternatives to traditional classroom settings.

By positioning itself as a comprehensive and engaging learning platform, Byju’s capitalized on the surge in interest in remote learning, further fueling its ascent to prominence.

Valuation Plunge From $22 Billion To Under $3 Billion

A mere 15 months ago, Byju’s was riding high with a staggering valuation of $22 billion, making it one of the most valuable edtech companies globally. However, the company has experienced a precipitous decline, and its current valuation has plummeted to under $3 billion. This drastic drop reflects a significant loss in investor confidence and raises concerns about the underlying financial health of the company.

Byju’s woes are compounded by the exit of key investors who were once instrumental in supporting the company’s growth. Notable backers, including Prosus NV, Peak XV, and the Chan Zuckerberg Initiative, have decided to sever ties with Byju’s by stepping down from the company’s board. The departure of these influential investors suggests a loss of faith in Byju’s business strategy, management decisions, or both, further contributing to the company’s financial challenges.

The situation worsens as creditors have taken control of Byju’s Alpha, a U.S.-based financing vehicle, due to an unpaid $1.2 billion term loan. This development underscores a severe liquidity crunch faced by Byju’s, where the company is unable to meet its financial obligations. The takeover by creditors signals financial distress, potentially affecting Byju’s ability to operate and service its debts, posing a threat to the overall stability of the organization.

The unpaid $1.2 billion term loan has become a focal point of Byju’s financial challenges. The failure to meet this substantial financial obligation has led to creditors taking decisive action to safeguard their interests.

This debt-related crisis not only reflects on the company’s financial mismanagement but also raises questions about the sustainability of Byju’s business model and its ability to generate sufficient revenue to cover its liabilities.

The cumulative effect of the valuation drop, investor exits, and creditor control points to a severe liquidity crunch for Byju’s. A liquidity crunch occurs when a company lacks the necessary funds to meet its short-term obligations, potentially jeopardizing day-to-day operations. Byju’s, once a high-flying edtech unicorn, is now grappling with the immediate financial challenges that threaten its continued existence in its current form.

Aggressive Sales Tactics And Toxic Work Culture

The success of Byju’s was initially propelled by an aggressive sales machine that aimed to achieve rapid growth. However, this very sales-driven approach is now identified as a major contributor to the company’s downfall.

Current and former employees have come forward to reveal the existence of a toxic work culture within Byju’s. The aggressive pursuit of sales targets led to an environment where employees felt immense pressure to deliver results at any cost.

One of the alarming aspects highlighted by employees is the prevalence of verbal abuse within the organization. Salespeople reported enduring verbal mistreatment as they tried to meet demanding targets.

This culture of aggression not only created a stressful workplace but also adversely impacted the mental and emotional well-being of the employees. The relentless pursuit of sales at the expense of employee welfare fostered an environment that was detrimental to the overall work culture.

Employees faced additional challenges as they were allegedly pressured to work even when unwell. The pressure to meet targets was so intense that some employees had to show up on sick days, only to be sent on medical leave afterward.

This practice not only compromised the health of the workforce but also showcased a disregard for employee well-being in the pursuit of sales goals. Manipulative tactics, such as forcing employees to show up on sick days, reveal a disregard for ethical work practices.

Frontline staff, working long hours six days a week, reportedly faced guilt-tripping tactics for wanting to leave work at a reasonable hour. The pressure to work extended hours and meet aggressive targets created an environment where employees felt guilty for seeking a work-life balance.

Additionally, some representatives allegedly resorted to deceptive sales strategies, such as asking friends and family to make purchases only to cancel them later for a refund. These practices suggest a culture that prioritizes short-term gains over ethical conduct.

The book, “The Learning Trap” by Pradip Saha, sheds light on allegations that Byju’s engaged in sales manipulation. In instances where customers had stopped paying, the company was accused of crediting monthly installments to lenders, potentially masking the financial difficulties faced by the organization. Such alleged practices not only raise concerns about the transparency of Byju’s operations but also hint at attempts to manage appearances and financial realities.

Byju’s has responded to these allegations by stating that many of the instances highlighted in the book are not systemic deficiencies but localized lapses that occurred during a period of rapid growth.

The company claims to have tightened processes since then. However, the allegations of a toxic work culture and manipulative sales practices continue to cast a shadow over Byju’s reputation and contribute to the challenges it faces in retaining investor confidence and recovering from its financial downturn.

Legal Troubles And Regulatory Scrutiny

Byju’s found itself entangled in legal troubles with a probe initiated in India for alleged violations of foreign exchange controls. The nature and extent of these violations remain undisclosed, creating uncertainty around potential legal repercussions for the company. Regulatory scrutiny in matters of foreign exchange controls implies a breach of financial regulations, and the outcome of this investigation is awaited.

Despite the ongoing investigation, Byju’s has maintained that it has been in complete adherence to regulations. The company asserts its commitment to compliance and regulatory standards, suggesting that any deviations are unintentional or disputable. However, until the resolution of the probe is revealed, the legal implications for Byju’s remain uncertain.

The recent departure of the group general counsel from Byju’s raises eyebrows and adds another layer of concern. Legal experts are often key figures in navigating regulatory challenges, and their departure can be perceived as a sign of internal discord or a response to the legal scrutiny the company is facing. This development keeps investors cautious, as it may indicate potential legal vulnerabilities and challenges in navigating complex regulatory landscapes.

A Great Opportunity Missed

Byju Raveendran had a notable opportunity to contribute to education in India by bridging gaps through affordable courses and philanthropic efforts. With the launch of the app in 2015, there was a chance to address disparities in the education system and provide quality learning opportunities to a broader audience. Philanthropic initiatives, coupled with affordable courses, could have positioned Byju’s as a socially responsible education provider.

However, Byju’s chose a path of rapid growth over social relevance. The emphasis on aggressive sales tactics, as highlighted in earlier sections, shifted the company’s focus towards expanding market share and achieving high valuations. This emphasis on growth at all costs may have led to compromised ethical standards and contributed to the current challenges facing the company.

The learning app initially envisioned as a tool for educational empowerment, transformed into a sales-driven trap, prioritizing revenue generation over social impact. The question arises whether Byju’s could have thrived as a nonprofit, similar to Khan Academy, by focusing on stability and a mission-driven approach.

Nonprofit models often prioritize educational impact and community welfare over aggressive revenue targets, offering a potential alternative path that Byju’s did not explore.

Byju’s current predicament prompts a reflection on the consequences of its growth strategy. While the company aimed for glamour and high valuations, the sustainability of its approach is now under scrutiny. The missed opportunity to focus on stability, affordability, and philanthropy raises questions about the long-term impact Byju’s could have had on education in India had it chosen a more balanced and socially relevant growth path.

Image Credits: Google Images

Feature image designed by Saudamini Seth

Sources: Business Standard, Economic Times, Live Mint

Find the blogger: Katyayani Joshi

This post is tagged under: Byjus, exploitation, sales practice, human resources, education, online education, coaching, membership, financial incongruencies, ethics, social relevance, book, learning trap

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