Byju’s has raised $250 million from its existing investors as the educational technology (edtech) giant targets profitability by March next year.
The valuation of the Bengaluru-based firm remains at $22 billion, informed sources. Existing investors who have invested in this round include Qatar Investment Authority (QIA).
Byju’s has raised a total funding of $5.5 billion from investors like Sumeru Ventures, Vitruvian Partners, BlackRock, Chan Zuckerberg Initiative, Sequoia, Silver Lake, Bond Capital, Tencent, General Atlantic, Tiger Global, and QIA. The firm has over 150 million learners.
“We are in that sweet spot of our growth story where unit economics and the economies of scale are both in our favour,” said its founder and Chief Executive Officer Byju Raveendran.
“This means the capital we now invest in our business will result in profitable growth and create sustainable social impact,” he added.
Regardless of the adverse macroeconomic conditions, Raveendran said 2022-23 is set to be the best year in terms of revenue, growth, and profitability.
“Continued support from our esteemed investors reaffirms the impact created by us so far, and validates our path to profitability,” he said.
Byju’s has raised funding at a time the edtech firm booked losses of Rs 4,588 crore for 2020-21 (FY21), 19x more than the preceding year, according to its latest financial report.
The firm, which was last valued at $22 billion, earned Rs 2,428 crore in revenue in FY21. Its adjusted revenue in 2019-20 was Rs 2,511 crore; the adjusted loss Rs 300 crore.
Byju’s is now set to lay off nearly 2,500, or 5 per cent, of its workforce as part of an ‘optimisation’ drive. The move by India’s most valuable start-up comes amid a funding winter freeze and steep losses.
It has embarked on the path to achieving group-level profitability by March next year with a three-pronged approach.
It is consolidating all its K10 India subsidiaries into one unit to leverage their synergies. Aakash Education and Great Learning, which are into test preparation and upskilling, respectively, will continue to operate as standalone independent units.
Byju’s will now be reorienting its marketing budget towards its overseas markets. The group is also increasing the strength of its in-house sales team for more efficient and effective consumer-centric lead conversions.
It plans to hire 10,000 teachers in the next six months, adding to the current strength of 20,000.
The company is also expanding its teams, besides hiring senior leadership, to further build operational strength.
The hiring strategy will play a crucial role in the company’s optimisation plan as it looks to target profitability by March next year.
Byju’s plans to hire people in India, the US, and Latin America. Almost half of the recruitment will be done in India, the rest will be conducted in overseas markets.
“The plan is to go deeper into India and go global as well. About 60-70 per cent of our teachers are women. They are able to utilise the benefit of being able to teach from their homes or anywhere in the world. It was a model we launched during the pandemic,” said co-founder Divya Gokulnath in a recent interview, adding, “That is what we are scaling further. The plan is to add 10,000 more teachers over the next six months.”
Raveendran recently told employees that the firm has started shifting focus towards profitable growth. He said a revenue of $2 billion was within sight and that the firm’s 2021-22 revenue was nearly Rs 10,000 crore, or $1.3 billion.
“This means we are now a $1 billion-plus revenue company,” said Raveendran, in a letter to employees.
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