Rama Krishna Sangem
Fortunes of India’s billionaire businessmen change overnight. Once praised as poster-boy of EdTech firms of India, Byju’s Raveendran is today a much maligned man. A major reason for this is Indian conditions and business values – where there is no tight regulatory monitoring. Our businessmen too are tempted to overnight riches and careless business practices!
Forbes Richest List 2024: A year ago, Byju Raveendran’s net worth stood at Rs 17,545 crore ($2.1 billion), and he was prominently featured in various prestigious ‘world’s richest’ lists. However, the recently released Forbes Billionaire Index 2024 reveals that Raveendran’s net worth has plummeted to literally big Rs zero.
This dramatic decline follows a series of crises that have severely impacted the once-thriving edtech startup, representing a notable downfall for the iconic figure in India’s startup ecosystem.
Noting Byju’s exit from the list, Forbes said, “Only four people from last year’s list dropped off this time, including former edtech star Byju Raveendran, whose firm Byju’s was enveloped in multiple crises and its valuation was marked down by BlackRock to $1 billion, a fraction of its peak $22 billion valuation in 2022.”
Rise and fall of Raveendran
Founded in 2011, Byju’s quickly rose to prominence as India’s most valuable startup, reaching a peak valuation of $22 billion in 2022. Raveendran’s brainchild revolutionised the education sector with its innovative learning app, serving students from primary school to MBA aspirants. However, recent financial disclosures and growing controversies have severely impacted the company’s fortunes.
The challenges faced by the company became evident with the release of Byju’s overdue financial results for the fiscal year ending March 2022, which unveiled a substantial net loss surpassing $1 billion. This dismal financial outcome prompted BlackRock, a major investor, to significantly reduce its valuation of Byju’s to just $1 billion, signifying a sharp decrease from its previous peak valuation.
Byju Raveendran has also faced severe criticism due to his company’s declining fortunes. Shareholders, including Prosus NV and Peak XV Partners, recently voted to oust Raveendran as CEO, escalating a battle over the future of the once-thriving online tutoring startup, which is now striving to stay afloat.
In addition, Byju’s foreign investments have drawn the attention of the Enforcement Directorate (ED). Before issuing a lookout circular against its founder, the ED sent show cause notices to Byju’s parent company, Think & Learn, regarding alleged Foreign Exchange Management Act (FEMA) violations amounting to over Rs 9,362 crore.
We just saw how Gautam Adani’s fortunes have almost halved from 120 billion US dollars last year, thanks to a story put out by US based Hindenburg research. Of course, now he is back to 60 per cent of previous best. We need to see, how the fate of Byju’s will unfurl over the coming months.
