BYJU’S Vs Lenders, New-Age Tech Stocks Rebound & More

Byju Raveendran Bares It All

For the first time since BYJU’S was thrust into turmoil three years ago, cofounder Byju Raveendran has publicly broken his silence on what transpired at the company. From receiving threats to alleging a conspiracy to oust him, he had much to speak about. 

Raveendran’s Biggest Regret: In a damning confession, the BYJU’S cofounder conceded that his biggest regret was taking the $1.2 Bn term loan B (TLB) in 2021, despite having sufficient equity funding options. He explained that aggressive hedge funds bought the loan and sped up its repayment, which wasn’t due until November 2026.

Allegations Run Amok: Alongside claims of external pressures and internal errors, cofounder Divya Gokulnath also detailed an alleged campaign of intimidation targeting close associates. Both she and Raveendran further asserted that certain lenders orchestrated a malicious media campaign and manipulated legal and administrative channels to seize control of BYJU’S.

Blitzscaling Gone Wrong? During the podcast, Raveendran also indicated that BYJU’S troubles were likely a consequence of the rapid expansion of operations, which overlooked sustainable growth and profitability. In his own words, the edtech startup expanded “too fast” – 21 countries in two years – driven by a “mandate” from its global investors to grow. 

The Inherent Contradiction: While Raveendran had much to say, there is also another side – of investors and creditors – to the story of BYJU’S fall from grace. Over the years, we have seen the edtech platform dodge questions, delay financial results and evade accountability, all while burning through billions of dollars, laying off thousands and pushing sales teams to sell products at the peril of unsuspecting parents.

Regardless of the challenges, the revelations have put the spotlight back on the Raveendrans’ ambition to reassert control over BYJU’S. While the future is unclear, here’s what the husband-wife cofounders of BYJU’S had to say.

From The Editor’s Desk

Tonbo Imaging Gears Up For IPO: The defence tech startup plans to file its DRHP with the SEBI by August to raise INR 800 Cr to INR 1,000 Cr via IPO. Tonbo has appointed IIFL Securities and JM Financial as the book-running lead managers for its public issue. 

Suicide At Ola Krutrim: The GenAI unicorn has confirmed that one of its engineers, part of the data science team, died by suicide on May 8. This follows a Reddit post, which claimed that the employee was under severe work-related stress at the company.

Startup Funding Tanks: Indian startups cumulatively raised $151.6 Mn across 24 deals last week, marking a 74% decline from the $587 Mn raised the previous week. Emerging on top, Farmley raised $40 Mn while Complement1 bagged $16 Mn. 

VerSe Innovation Axes 350 Jobs: The DailyHunt parent has laid off the employees as part of a broader exercise to spur investments in AI and focus on long-term priorities and growth. This follows Deloitte flagging weaknesses in the company’s internal financial controls in FY24 report.

AJIO, Myntra Boycott Turkish Brands: The two ecommerce platforms have delisted Turkish apparel brands like Trendyol, Koton and LC Waikiki on their websites. This comes after Turkey backed Pakistan during the latter’s standoff with India. 

Foxconn Ramps Up India Play: Foxconn will soon kick off the shipments of iPhones from its new plant in Karnataka. The new facility in Devanahalli is touted to be the company’s second biggest factory in the world and will have a capacity of manufacturing 2 Cr iPhones annually. 

New-Age Tech Stocks Rebound: All 33 new-age tech stocks under Inc42’s coverage ended last week with substantial gains in the range of 0.83% to nearly 35%. TAC Security and ideaForge were the biggest gainers, soaring 34.86% and 21%, respectively,  last week. 

Proposals Galore For Indian LLMs: The Centre has received 506 proposals in total from startups and other entities to build an indigenous foundational AI model. Last month, SarvamAI was selected from the first pool of applicants to build the country’s first sovereign LLM.

Inc42 Startup Spotlight

How FinRight Is Simplifying PF Withdrawals 

Provident fund (PF) is the financial backbone for the retirement plans of many salaried professionals. But PF withdrawals can be a cumbersome task, be it the complex documentation process or KYC verification. That’s where FinRight steps in.

The AI Twist To Withdrawals: Founded in 2023, FinRight’s AI-powered tool, CheckMyPF, helps users generate a detailed health report of their PF account within minutes, flag blocked amounts and highlights issues before they become roadblocks. 

Besides, FinRight also manages the coordination and paperwork involved in the process of making withdrawals and steps in when users face technical glitches or run into problems with the EPFO system.

A Thriving Market To Bank On: Till date, the Mumbai-based startup claims to have processed over 15,000 PF claims worth more than INR 300 Cr, serving 8,000+ users from companies like Google, Netflix, Deloitte, and EY.

FinRight has set its eyes on the 73.7 Mn EPFO subscribers in the country in FY24, with total contributions totalling INR 2.6 Lakh Cr during the same period. But, with giants like BankBazaar, Groww and Paytm on its tail, can FinRight simplify complex PF withdrawals with AI?

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