Zero net worth: Byju Raveendran out of Forbes Billionaire Index 2024

Byju Raveendran, one of the most prominent faces of India’s edtech sector, has faced a steep decline in his net worth after his firm Byju’s was hit by multiple crises. Raveendran’s net worth has slipped to zero, a year after it stood at $2.1 billion (₹17,545 crore), as per the Forbes Billionaire Index 2024.

The free fall in Raveendran’s net worth is a reflection of the steep decline in the valuation of Byju’s. The cash-starved startup, in January this year, sought to raise $200 million via rights issue at a post-money valuation of $225 million. This marked a decline of 90% as compared to its valuation of $22 billion in the last funding round in March 2022.

Forbes, while releasing the global list of billionaires, said only four Indians who were counted amongst billionaires till last year have now been dropped. This includes “former edtech star Byju Raveendran, whose firm Byju's was enveloped in multiple crises”, the publication said.

Byju's crises: Valuation cut, weak fiscal results and layoffs

Byju’s financial challenges were laid bare following the long-delayed results of the fiscal year ending March 2022. The company, while declaring the results in January this year, reported net losses exceeding $1 billion (₹8,245 crore) in FY22. The weak annual performance led private equity major BlackRock to slash its valuation to $1 billion, from $22 billion in 2022.

Raveendran has drawn the ire of a section of investors following the dismal financial performance, with two shareholders – Prosus NV and Peak XV Partners – voting to oust him as the company’s CEO in an extraordinary general meeting (EGM) held in February.

Raveendran had, however, challenged the EGM’s decision before the Karnataka High Court, claiming that due process was not followed. While the legal proceedings are underway, the court has granted him interim protection from ouster.

Byju’s was also in the news earlier this week, after the company laid off 500 employees. Reeling under a severe cash crunch, Byju’s has delayed salary payments for three consecutive months. According to reports, the company’s headcount has dropped to around 13,000 from 15,000 at the end of 2023.

Byju's has reportedly sacked around 10,000 employees in the last two years. While the company’s dwindling cash reserves, faceoff with investors and legal battles are cited as the key triggers behind the layoffs, analysts also point towards the fall in demand for online education. The demand has ebbed significantly as compared to the peak recorded during the COVID-19 pandemic period.