Byju’s Founder Offers Personal Home to Secure Funds for Staff Salaries Amid Deepening Crisis, Reports Say

Byju Raveendran, the founder of the popular edtech company Byju’s, is facing a financial crisis and has taken drastic measures to ensure the payment of his employees’ salaries. According to insiders, Raveendran has pledged his own home, as well as properties owned by his family members, as collateral to raise funds.

The properties in question include two houses owned by Raveendran’s family in Bengaluru, as well as his under-construction villa in Epsilon, a luxurious gated community in the city. These properties were used as collateral to secure a loan of $12 million, which was then utilized to pay the salaries of 15,000 employees in Byju’s parent company, Think & Learn Pvt.

In an effort to alleviate the financial pressures faced by the company, Raveendran has been exploring various options. Byju’s, once considered India’s most valuable tech startup, is currently in the process of selling its US-based kids’ digital reading platform for approximately $400 million. Additionally, the company is embroiled in a legal battle with creditors due to a missed interest payment on a $1.2 billion term loan.

Raveendran, who was once worth nearly $5 billion, has personally raised debts of around $400 million by pledging all his shares in the parent company. Furthermore, he reinvested $800 million from previous share sales back into the company, resulting in a significant strain on his personal finances.

Last month, Byju’s released its first financial results in years, revealing a slight narrowing of losses for Think & Learn amidst a surge in business during the pandemic. The company also stated that an investigation by an Indian federal agency into its overseas fundraising has concluded, with any potential penalties expected to be minimal.

The situation at Byju’s highlights the challenges faced by even the most successful startups, as they navigate financial hurdles and adapt to changing market dynamics. However, with Raveendran’s determination and the company’s ongoing efforts, Byju’s aims to overcome these obstacles and continue its growth trajectory in the edtech industry.