SUMMARY
After multiple delays in disbursing the employee salaries for the month of March, BYJU’S cleared part of the pending salaries on April 20
Founder and CEO Byju Raveendran took more personal debt to clear the salaries, a source told Inc42
BYJU’S is facing a severe cash crunch, which has resulted in it delaying disbursement of employee salaries for the months of February and March
After multiple delays in disbursing the employee salaries for the month of March, beleaguered edtech giant BYJU’S cleared part of the pending salaries on Saturday (April 20), sources told Inc42.
“Teachers and people at the lower end of the pyramid have been paid 100%,” the sources added.
Founder and CEO Byju Raveendran took more personal debt to clear the salaries, one of the sources told Inc42.
The development was first reported by Moneycontrol. The report said that BYJU’S initially cleared the complete salaries for two teams, while the employees of the remaining teams received half of their salaries recently.
BYJU’S is facing a severe cash crunch, which has resulted in it delaying disbursement of employee salaries for the months of February and March.
Earlier this month, the troubled startup told employees that it arranged an alternative line of credit to clear their salaries and the process would be completed by April 18.
It is pertinent to note that media reports said in December that Raveendran pledged his house and family’s property to get a loan to clear the salaries of BYJU’S employees.
The developments come at a time when BYJU’S has raised $200 Mn via a rights issue at a 99% valuation cut. However, the amount is kept in a separate escrow account due to an order by the National Company Law Tribunal (NCLT) over a plea filed by its investors.
BYJU’S has blamed its investors multiple times for the delays in vendor payments and disbursement of employee salaries.
Last week, BYJU’S also said that its shareholders voted in favour of increasing the company’s authorised share capital, paving the way for it to conclude the rights issue. According to the edtech giant, 55% of the shareholders voted in favour of the decision through a postal ballot.
“The approval of the EGM proposals paves the way for Think & Learn Private Limited, the parent company of BYJU’S, to issue fresh shares and conclude the rights issue aimed at tackling the liquidity crunch, including unpaid salaries, regulatory dues and vendor payments,” the startup said.
BYJU’S has been trying to douse fire on multiple fronts over the last year or so. From delay in filing financial statements, rising losses, and layoffs to its ongoing war with investors, multiple legal cases, and insolvency petitions, the company is plagued by a slew of issues.
Last week, the NCLT gave the company a week’s time to resolve its payment dispute with French outsourcing firm Teleperformance Business Services.
Meanwhile, BYJU’S India CEO Arjun Mohan is exiting the startup months after his joining.
