According to media reports, a group of shareholders of Indian EdTech giant Byju’s called for the removal of Byju Raveendran, the company’s founder and CEO, on Tuesday.
Shareholders made the demand during an extraordinary general meeting held on July 4th to address the reported crisis at the EdTech firm.
According to sources familiar with the matter, news agencies reported that no action was taken on this demand as it was raised by a small group of shareholders and lacked support from the majority shareholders.
Furthermore, the significant stake held by the company’s promoters makes it challenging to remove Byju Raveendran as the CEO of Byju’s.
In the latest development, certain shareholders who spoke to news agencies have refuted the information that a group of shareholders sought the removal of Byju as CEO. According to them, no such demand was made, there was no discussion on the matter, and it was not listed on the agenda of the extraordinary general meeting.
Byjus, the renowned Indian EdTech firm widely regarded as one of the most successful startup ventures in the country, has been facing significant challenges over the past few months.
Byjus has been adversely affected by several factors, including a decline in demand for online education compared to the peak of the pandemic, financial difficulties, allegations of predatory practices towards customers, and accusations of fostering a toxic work culture. These challenges have had a profound impact on the company.
Byjus has attracted significant funding from renowned investors in recent years, primarily due to the substantial increase in demand for online education. Leveraging these funds, Byjus has made numerous acquisitions of smaller EdTech companies offering diverse online education and training services.
Challenges arose when the popularity of “online education” began to decline with the reduction of the pandemic’s impact. The sales of online courses offered by Byjus and its subsidiaries reportedly experienced a decline, consequently impacting the revenue flow of the company.
Byjus’ audited results for the financial year 2020-21 revealed significant losses amounting to Rs 4,500 crore, marking a substantial 17-fold increase compared to the Rs 262 crore loss in the previous year. The delayed release of the financial statement drew the attention of the Ministry of Corporate Affairs, placing the company under scrutiny.
In the past month, there were resignations of board members and statutory auditors from Byjus, citing various reasons. Deloitte, the statutory auditor, stepped down due to the inability to complete the long-pending audit for the financial year (FY) 2022. The company has now clarified that new auditors and the CFO have committed to completing the audit for FY 2022 by September and FY 2023 by December, respectively.
