Byju’s, once counted among the world’s most valuable startups, is looking to raise funds at a discount of more than 90% from its previous round to ease its financial woes.
The beleaguered Indian education provider is seeking more than $100 million from existing investors in a fresh share issue planned for next month, at a price that values the company at less than $2 billion, people familiar with the matter said. That’s down from $22 billion at its previous round in late 2022.
Eponymous founder Byju Raveendran will participate in the share sale to keep his stake in the company, the people said, asking not to be named because the information is not public. The company, which has been battling a cash crunch for several months, will use the proceeds from the stock sale planned for next month to pay vendors and stabilize the business, they said.
Raveendran pulled out all the stops in his fight to keep the company afloat and to ease its financial pressures. The company is in the process of selling its US children’s digital reading platforms for about $400 million and is also locked in a legal battle with creditors over a missed interest payment on a $1.2 billion term loan.
A spokesman for the company declined to comment.
The company is focused on rebuilding its core business and will double down on recent attempts to jump on the next big bandwagon in education: generative artificial intelligence for so-called hyper-personalized learning, after the stock sale, the people said.
Backed by the Chan Zuckerberg Initiative, General Atlantic and Prosus NV, Byju’s – formally known as Think & Learn Pvt – raised billions of dollars to fund a global acquisition before it ran into a global tech funding downturn. Several shareholders in the company are expected to participate in the stock sale, the people said.
Unlock a world of Perks! From insightful newsletters to real-time stock tracking, breaking news and a personalized news feed – it’s all here, just a click away! Login Now!
Catch all Corporate news and Updates on Live Mint. Check out all the latest action on Budget 2024 here. Download The Mint News App to get Daily Market Updates and Live Business News.
More or less
Published: 23 Jan 2024, 14:28 IST