In his internal e-mail, Byju Raveendran also conceded that the procedure was “not as easy” as the business had hoped.
The decision to terminate 2,500 employees was made “to maintain the health of the bigger business and pay regard to the limits imposed by external macroeconomic conditions,” Byju’s founder and CEO told staff on Monday.
In his internal e-mail, Byju Raveendran also conceded that the procedure was “not as easy” as the business had hoped. A copy of the communication has been examined by ET.
If this process is not going as smoothly as we had hoped, I beg your pardon. We want to complete this process quickly and effectively, but we don’t want to rush it. As a result, we are giving each member of the affected team the respect, understanding, and time they require when we inform them. I want to underline that the entire job reduction do not represent more than 5% of our current workforce, stated Raveendran.
The email comes after Byju’s decided to reduce its 50,000-person workforce by 5%.
The decision drew harsh criticism from Kerala-based employee unions who said the business was pressuring staff to leave. The state government has started an inquiry into Byju’s labor practices.
Raveendran claimed that although the business had grown rapidly over the previous four years, it was now striving to “develop sustainably.”
“Over the past four years, we have rapidly and significantly expanded globally. Our hypergrowth years, from 2018 to 2021, saw us consistently shattering records in every business parameter. By welcoming team members from our acquisitions as well as our core business, we also greatly expanded our family, he added.
“And then 2022 occurred. This year, a number of unfavorable macroeconomic circumstances altered the business environment. Due to these, tech businesses all around the world are putting more of an emphasis on sustainability and capital-efficient growth. Byju’s is also in line with this pattern.
After an 18-month delay, Byju’s released its fiscal year 2020–21 results last month.
It revealed a loss of Rs 4,588 crore, which is nearly 18 times worse than the same period last year.
The business, which is currently the most valuable startup in India, announced that its operating revenue for the fiscal year that ended on March 31, 2021, has been readjusted to Rs 2,280 crore.
This was a substantial decrease of approximately 50% from the anticipated revenue of about Rs 4,400 crore stated in the unaudited results of Byju’s parent company Think & Learn Pvt Ltd, which has recently been under heavy scrutiny for its accounting practices.
According to a report from ET on October 18, Byju’s secured a $250 million funding round from current investors, including the Qatar Investment Authority (QIA), which took the lead with over $100 million.
Byju’s announced a modification to its direct-to-consumer sales model in September. This has caused it to begin closing several of its field sales offices across the nation, where people are either being transferred to larger centers or being laid off.
“I am aware that following this path to profitability comes with a hefty price. To prevent role duplication throughout our businesses, we are being forced to part ways with 2,500 of our coworkers, Raveendran stated.
