Dubai [UAE]: Byju Raveendran, the founder and CEO of embattled Indian edtech giant BYJU’S, has acknowledged that one of the company’s biggest missteps was opting for a USD 1.2 billion term loan in 2021, despite having adequate access to equity capital at the time.
In an exclusive interview with ANI, Raveendran reflected on the decision, which was taken collectively with the board, including both founder and investor directors. He emphasized that the move was not made out of desperation, pointing to BYJU’S previous successful fundraising efforts totaling USD 5 billion.
“Only mistake if you ask me, which created all this is that we shouldn’t have taken this, when we had enough equity options, we shouldn’t have taken this term loan at that time in 2021. One billion (USD) because it was, like, we had other options. We have raised 5 billion before that. We were not doing it out of desperation. It was all collective decision. Today everyone, like our board was like three founder directors and three investor directors. They were there till 2020,” Raveendran said.
BYJU’S, once a poster child of India’s edtech revolution, has in recent years faced growing financial instability, regulatory pressure, and legal challenges. Raveendran admitted that decisions around some of the company’s acquisitions, such as WhiteHat Jr., also proved to be missed opportunities.
“….those are all business mistakes. now I am like today, even though that came through an acquisition, the concept of whitehead Junior, what would have really changed is teachers in India teaching students anywhere in the world who wanted to learn math from Indian teachers. Like, that’s a huge opportunity lost,” he said.
Financial Troubles with BCCI
Raveendran also addressed BYJU’S dues to the Board of Control for Cricket in India (BCCI), stemming from its title sponsorship of the Indian cricket team.
“We paid…we would have paid almost thousand five hundred crores before that. But the last 158 crores, we were not able to pay because the company was going through a liquidity crunch. Approximately, that’s the amount we would have paid in those three years when we had the sponsorship. Last 10% was remaining, which they went to NCLT with that. But the moment, we got admitted into this CIRP process, we arrived at a settlement with BCCI and we paid them the amount. So we should have been out of insolvency and company should have come back, should have been back to us within 15 days,” he explained.
On the Aakash Acquisition
Despite challenges, Raveendran described BYJU’S USD 950 million acquisition of Aakash Educational Services Ltd (AESL) as one of the company’s smartest strategic moves.
“It’s one of our best acquisitions. Today, all this narrative around acquisitions – like we made mistakes – like when you make six big acquisitions, four of them are doing well but everyone talks about the two, and that’s how it works, right?” he said.
The acquisition, completed in April 2021, was one of the largest in India’s startup ecosystem, comprising 70% cash and 30% equity.