Byju's, an Edtech Giant, Attempts to Raise $1 billion to Fend off Investor Revolt

According to the sources, the education firm is providing advantages to potential investors, including preferential treatment in the event of insolvency.

According to sources, the Indian edtech startup Byju’s is in advanced discussions with potential new shareholders for a $1 billion financing round in an effort to quell an uprising by some investors.

The source stated that the education startup was providing advantages to potential investors, including preferential treatment in the event of bankruptcy. It was also stated that none of the company’s current owners have a so-called liquidation preference.

The story claims that the education company is offering incentives to potential investors, such as special treatment in the case of bankruptcy. It was also highlighted that none of its present owners had a purported inclination for liquidation. Byju’s aims to finish a round in two weeks.

The news comes days after executives from three major investors, Peak XV, Prosus NV, and the Chan-Zuckerberg Initiative, abruptly left the company without providing a public explanation. Additionally, auditor Deloitte announced it was cutting ties with the startup due to its “long-delayed” financial statements for the year ended March 2022.

The largest shareholder in Byju, Prosus, has further reduced the business’s fair value to $5.1 billion, adding to the startup’s never-ending list of problems. Byju is currently the most valuable company in India.

Byju’s is now valued at $5.1 billion by Prosus, who has estimated the fair value of its $9.6 percent holding at $493 million. When Byju’s raised a $250 million investment round in October 2022, the company’s latest announced valuation was over $22 billion.