Byju’s is planning to raise $500-600 million from Abu Dhabi’s sovereign wealth funds and existing investors, according to sources, as the start-up world is facing a funding freeze.
The educational technology (edtech) giant targets profitability by March next year.
“There is no change in Byju’s valuation. The new fundraising process is still going on,” said a person familiar with the matter.
“Any new valuation would be determined in the future as it is very tough for investors to do that in this environment.”
Byju’s didn’t respond to queries on the company’s fundraising plans.
In its last round, the firm had raised $250 million from Qatar Investment Authority (QIA) and existing investors.
The valuation of the firm had remained static at $22 billion. Byju’s had raised $800 million in a funding round this March, with Founder and chief executive officer Byju Raveendran bringing in half of it.
Raveendran was in talks with various international and domestic banks to raise $400 million as a loan to fund 50 per cent of the $800-million funding round, according to people familiar with the development.
The Bengaluru-based firm recently announced plans to lay off nearly 2,500 people, or 5 per cent, of its workforce as part of an ‘optimisation’ drive.
The edtech firm booked losses of Rs 4,588 crore for 2020-21 (FY21), 19 times more than the preceding year, according to its latest financial report.
The firm earned Rs 2,428 crore in revenues in FY21.
Its adjusted revenue in FY20 was Rs 2,511 crore, with the adjusted loss standing at Rs 300 crore.
Raveendran had earlier said that the firm was in a sweet spot in terms of its growth story where unit economics and the economies of scale were both in its favour.
This meant the capital that the company would invest in its business would result in profitable growth and create sustainable social impact, he had added.
The firm has now embarked on the path to achieving group-level profitability by March next year with a three-pronged approach.
It is bringing the K10 subsidiaries — Meritnation, TutorVista, Scholar, and HashLearn — under the India business unit. Other acquisitions Aakash and Great Learning would function separately.
The company is also realigning marketing spending to enhance its global footprint.
The firm also plans to hire 10,000 teachers in the next six months, adding to the current strength of 20,000 teachers.
The company is also expanding its teams, besides hiring senior leadership, to further build operational strength.
The firm said that it has already started shifting its focus toward profitable growth.
It said revenue of $2 billion was within sight of the firm and that the company’s FY22 revenue was nearly Rs 10,000 crore, or $1.3 billion.