The insolvency crisis facing Indian ed-tech giant Byju’s has triggered widespread concern among its workforce, marking a potential upheaval in the country’s startup sector. Once valued at $22
The insolvency crisis facing Indian ed-tech giant Byju’s has triggered widespread concern among its workforce, marking a potential upheaval in the country’s startup sector. Once valued at $22 billion and hailed as a leading figure in online education during the COVID-19 pandemic, Byju’s is now embroiled in a major financial dispute with U.S. lenders demanding $1 billion in unpaid debts.
Interviews with employees and reviews of internal communications reveal a growing sense of desperation as Byju’s faces a protracted battle over its insolvency. Employees, including those from its WhiteHat Jr. unit, are grappling with unpaid wages and mounting personal financial pressures.
Sukirti Mishra, a former mathematics instructor earning $1,200 a month, is among those affected. She has stopped teaching due to the company’s financial instability, which has led to conflicts with parents and personal financial distress. “A lot of people, including myself, have stopped taking classes because there’s no point doing charity for the company anymore,” Mishra told Reuters. She is struggling to manage medical expenses and loan payments while having gone unpaid for several months.
The situation has escalated to the Indian Supreme Court, which is scheduled to hear the insolvency case. The court’s recent decision to allow the insolvency proceedings to continue has raised fears among Byju’s 27,000 employees, many of whom are now exploring legal actions or street protests. The company’s board is currently suspended, and its assets are frozen as the legal process unfolds.
Since the insolvency proceedings began, approximately 3,000 employees have filed claims for unpaid wages, providing bank statements as proof. Byju Raveendran, the company’s founder, has reassured employees in an internal memo that efforts will be made to address their dues once the company regains control. However, he acknowledged the uncertainty and length of the recovery process.
The insolvency comes amid a series of setbacks for Byju’s, including boardroom exits, criticism over delayed financial disclosures, and a recent resignation of its auditor. The company’s financial troubles have not only jeopardized its operations but have also placed its employees in a precarious position, with no guarantees of recovering their dues.
As Byju’s attempts to navigate its financial crisis, the broader implications for the startup sector and the educational technology market remain uncertain. The company’s future depends on finding a new buyer or successfully liquidating its assets, a process that could take months and may not fully resolve the financial issues faced by its employees.
The situation highlights the volatility and risks inherent in the startup world, especially for employees who may find themselves vulnerable to financial instability. As Byju’s works through its insolvency challenges, the focus remains on how quickly the company can stabilize its operations and what measures will be taken to support affected staff.
