Byju's acquisition spree ends in insolvency: founder says once-$22B edtech is 'worth zero'

An edtech company selling online test-prep courses to Indian school and college students, later blended with offline coaching through acquisitions.

That acquisition-fueled growth was permanent: buy two dozen startups and outspend rivals while COVID-era online learning kept compounding into a $22B education monopoly.

Raised more than $5 billion in total

Byju's, founded by teacher Byju Raveendran, rode India's COVID-era online-learning boom to become the country's most valuable startup, raising over $5 billion and reaching a $22 billion valuation. In 2021 it bought Aakash Educational Services, a chain of more than 200 offline coaching centres serving 250,000 students, for close to $1 billion — about $600 million in cash plus stock — its largest deal in a spree of more than two dozen acquisitions.

By 2022 the financing that paid for growth dried up. Byju's missed financial reporting deadlines, fell more than 50% short of revenue projections, and board members and auditor Deloitte resigned citing governance issues; investors including Prosus, Peak XV and the Chan Zuckerberg Initiative later left the board. A rights issue valuing the company at just $25 million enraged existing investors, a court blocked a second one, and BlackRock wrote its stake down to zero. The company had also defaulted on sponsorship dues owed to the BCCI from its Indian cricket team jersey deal, taken on in 2019 and exited around December 2022.

On July 16, 2024, the NCLT Bengaluru bench admitted BCCI's petition over unpaid dues of about ₹158.9 crore ($19 million), initiated insolvency proceedings and installed an interim resolution professional, effectively removing the founder from control. Raveendran later conceded the company was 'worth zero', saying the acquisition of two dozen startups proved fatal once financing dried up in 2022.

The bet assumed pandemic-era online-learning demand would keep compounding, so Byju's spent billions acquiring companies and marketing when the market had already turned.

Financing dried up in 2022, and with board members, the auditor and key investors resigning over governance, no new equity was available to cover the bills.

Byju's kept spending on commitments like the cricket sponsorship while revenue fell more than 50% short of projections, so a comparatively tiny ₹158.9 crore debt was enough to trigger insolvency.

A rights issue at a $25 million valuation — versus $22 billion at peak — destroyed the remaining investor trust and left no path to recapitalize.

Acquisition-fueled growth works only while capital keeps flowing; when markets turn, the spree becomes fixed costs, and a single unpaid bill can trigger insolvency.

As of October 17, 2024, Byju's is under insolvency resolution: an interim resolution professional runs the company, claims have been invited from creditors, and founder Byju Raveendran no longer controls it. It was locked out of more than 100 tuition centres over unpaid rent and electricity, faced a demand notice from 62 former employees over about ₹2.3 crore in unpaid salaries, and was under investigation by the Enforcement Directorate. Raveendran said he hoped for a comeback but conceded the once-$22 billion startup was effectively 'worth zero'.