The ed-tech company which was once valued $22 bn in Oct 2022 after raising $250 mn in the funding round, now falls down to $1 bn
BlackRock, a U.S.-based investment firm, has once more decreased the estimated worth of its stake in Byju’s, lowering the educational technology company’s valuation to just $1 billion from its earlier valuation of $22 billion in early 2022. BlackRock, holding less than 1% of Byju’s, now values its shares at approximately $209.6 per share, a substantial decline from the peak of $4,660 recorded in 2022, as reported by TechCrunch. BlackRock revealed in a filing with the US Securities and Exchange Commission on January 5 that it has devalued its shares in Byju’s for the third time in 2023.
Prosus, the investment firm holding almost 9% of Byju’s, has followed suit by reducing the value of its stake in the edtech company to under $3 billion. This marks a significant drop of over 86% from the previous funding round valuation of $22 billion. Notably, in November of the previous year, Prosus initially lowered the fair value of Byju’s to $5.97 billion.
Prosus additionally expressed concerns about Byju’s, describing it as a business facing multiple challenges and grappling with various headwinds. Prosus, alongside other shareholders, is actively engaged in daily discussions with the company to address and navigate these issues collaboratively.
Over the last two years, the domestic educational technology firm has encountered significant financial challenges and has become embroiled in a series of controversies. These include issues related to a substantial cash crunch and allegations of violating FEMA (Foreign Exchange Management Act) rules.
Founder Byju Raveendran faced disappointment as the Enforcement Directorate (ED) conducted searches at the ed-tech firm’s premises and Raveendran’s residence in April 2023. During these searches, the ED seized documents related to all investments received by the company, along with documents concerning its overseas investments.
Reports also say that Byju’s is in need of a minimum of Rs 500 to Rs 600 crore to settle outstanding dues of employees and vendors.
Also read: Byju’s, once an edtech giant, now in dire straits?
