BYJU’s, the troubled edtech decacorn, appears to have averted a potential crisis as it reassured employees at its hybrid learning arm, BYJU’S Tuition Centre (BTC), that there will be no layoffs. The assurance was made during a town hall meeting attended by over 5,000 BTC employees on July 22. Additionally, the Bengaluru-based firm has agreed to pay variable pay and other incentives to its workforce.
Reports of Impending Protests and Their Resolution
The decision to reinstate variable pay and other incentives came after reports emerged that employees of the hybrid learning arm were planning a pan-India protest amid speculations of mass layoffs starting July 26. The protest organizers claimed that the promise to pay incentives was a response to their plans. However, sources close to the company stated that the town hall meeting was a regular business update and not an ’emergency’ meeting, as claimed by some protesters.
BYJU’s Official Statement on the Matter
A spokesperson for BYJU’s responded to the situation, stating that they had planned the town hall meeting in advance to celebrate BTC’s one-year completion and to mark the beginning of BTC 2.0, a more efficient version of the learning arm. The spokesperson denied having any knowledge of employee protests and clarified that they satisfactorily addressed all employee concerns, including restructuring and incentives.
BTC’s Current Status and Expansion Plans
BTC currently has 50,000 students enrolled across 302 centers in 143 towns. However, the operations continue to face challenges due to high sales and marketing costs and significant refunds in some centers. As part of its BTC 2.0 expansion plan, the company aims to achieve 10 enrollments per center per week and reduce refunds by 30%.
BYJU’s Struggles and Ongoing Challenges
This development adds to BYJU’s string of troubles over the past year, which included multiple rounds of layoffs affecting over 5,000 employees. The company’s financials have faced delays, and it has been grappling with raising funds amid a challenging funding climate in the Indian startup ecosystem. Additionally, BYJU’s has encountered a potential debt crisis involving its $1.2 billion term loan B (TLB) and faced valuation markdowns from investors. The company is also under scrutiny by the Enforcement Directorate for alleged violation of Foreign Exchange Management Act (FEMA) norms.
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