Byju’s plans 4k-5k job cuts in restructuring move: Reports
Byju’s, once a shining beacon of success in the Indian startup ecosystem, now finds itself grappling with a multifaceted set of challenges. This time, the edtech startup is looking to cut as many as 5,000 jobs in the coming weeks as part of a broader restructuring at the workplace. This strategic decision comes as a response to a series of challenges, including a cash crunch, and escalating pressure from creditors, compelling the edtech giant to realign its operations in order to ensure long-term financial sustainability.
According to media reports, Arjun Mohan – Byju’s new Indian CEO – has kicked off the restructuring exercise that will lead to around 11% of the workforce getting the boot in the coming weeks. Mohan has communicated these decisions to senior leaders in the firm, according to media reports. “We are in the final stages of a business restructuring exercise to simplify operating structures, reduce the cost base and better cash flow management,” a spokesperson spoke on the matter, adding, “Mr. Mohan would complete the process in the next few weeks and steer a revamped and sustainable operation.”
The layoffs are poised to impact a broad spectrum of roles encompassing both offline and online sectors within Byju’s operations, and includes sales and other areas where there is significant overlap. The marketing department will also see a substantial downsizing. Furthermore, the company has set its sights on removing a number of high-paying senior executive positions as part of its restructuring initiative.
Remarkably, this announcement follows a series of cutbacks that have seen over 10,000 full-time and contract positions eliminated over the past two years. The primary catalyst behind this massive workforce reduction is the pressing need to harmonize its operations with the financial constraints that have been accentuated by the deferral of Byju’s IPO. The company is now operating under the watchful eye of lenders, something that necessitates swift action to recalibrate the organization for a more secure financial footing amidst troubled times. It also comes as Byju’s has been working to consolidate four of its businesses into two (K-10 and Exam Prep).
If you have followed us, then you are aware that Byju’s – India’s most valuable startup with a staggering valuation of $22 billion as of last year – is going through a tough time as it is currently grappling with a multitude of financial challenges. Chief among these is the need to resolve a dispute with creditors concerning the terms of a $1.25 billion loan. The abrupt departure of board members and the resignation of its auditor, Deloitte, in June of this year have compounded these challenges. Additionally, Prosus, a major investor in Byju’s, publicly voiced its dissatisfaction, raising questions about reporting and governance structures.
