Amid an escalating crisis, the edtech company Byju’s reportedly failed to pay employees in January, according to Money Control. This surprising turn of events comes despite the company’s previous assurance to employees in December that salaries would be credited on the first of each month.
In a recent letter to its employees, Byju’s thoroughly outlined the upcoming pay dates, with December salaries due on January 2 and January salaries on February 1. However, the company appears to have fallen short of this commitment, raising concerns among employees.
In a new letter dated February 4, Byju’s founder and CEO, Byju Raveendran, attempted to calm fears by announcing the successful crediting of all pending January salaries to employees over the last two days. In the letter, Raveendran expressed empathy, acknowledging employees’ expectations for their salaries, saying, “I have been moving mountains for months to make payroll, and this time, the struggle was even bigger to ensure that you receive what you rightfully deserve.”
The news comes after Byju’s senior management acknowledged in a letter dated January 2 that the delay in salary disbursement was caused by an “artificially induced crisis by select investors.” as money control reported.
Raveendran, reportedly took an unconventional approach to mitigating the crisis, pledging his home and family members’ assets to raise funds for employee payments during the cash crunch. Byju’s once hailed as India’s most valuable startup, is caught in a web of problems in 2022, including accounting irregularities, alleged mis-spelling of courses, and significant layoffs.
In response to these challenges, the company has undergone significant changes, including additional funding from early investor Ranjan Pai and the formation of an advisory council. According to Moneycontrol, Byju’s is also considering asset divestment, with discussions going on about selling assets such as Great Learning and Epic.
This latest setback calls Byju’s financial stability into question, as its ability to navigate the complexities of the edtech industry. As the company faces greater scrutiny and internal trouble the road to recovery appears to be filled with challenges, leaving employees, investors, and industry observers worried about Byju’s future path.