As if delayed results, a surge in losses, and raids by the Enforcement Directorate weren’t enough, Byju’s has also opted against paying a $40 million installment on its $1.2 billion loan, due to a dispute with creditors. But the legal tussle for Byju’s in the US could affect funding for other Indian startups, which we already down 75 per cent for the January-March quarter in FY23.
Reacting to the news of Byju’s suing its lenders for predatory tactics, Byju’s rival upGrad’s founder Ronnie Screwvala called out the firm for its drama with zero content in a tweet.
The film producer-turned-startup founder, also added that even Netflix or HBO won’t buy Byju’s, as he took a jibe at the unicorn for spoiling India’s reputation as an investment destination.
Indian startups losing investor confidence?
Screwvala’s comments come at a time when India’s edtech startups, which had gathered steam during the pandemic, saw the euphoria fizzle out as schools reopened and now face a funding crunch.
Like Byju’s other edtech platforms in India have also been hit by a spate of layoffs, as they fired almost 10,000 people, out of a total of 27,000 startup employees left jobless.
The image of Indian startups was further blemished when four firms funded by global investor Sequoia were hit by scams involving embezzlement and inflated revenues.