Byju's To Cut 2,500 Jobs As It Targets To Turn Profitable By March

Byju's plans to cut nearly 2,500 jobs across different functions in an attempt to avoid redundancies as the edtech unicorn targets to be profitable by March.

Around 5% of Byju's 50,000-strong workforce is expected to be rationalised across product, content, media, and technology teams, which will help it to leverage technology "better", it said in a statement.

The job cuts at the online learning platform underscore concerns around valuations of India's tech platforms as funding slows down. Byju's had expanded through acquisitions rapidly during the pandemic when schools went online. Last valued at $22 billion, the company delayed its audited results filing, after missing timeline to close funding. Its net loss widened to Rs 4,588 crore in FY21.

The edtech startup blamed the performance on changes in accounting practices that led it to defer revenue to subsequent years. It also released the unaudited numbers for FY22 and the following four months showing significant sales growth.

The company's "top priority" is to achieve overall profitability by March 2023, Byju's said on Wednesday.

Furthermore, the edtech company will cut its marketing budget domestically and prioritise spending "to increase brand awareness in overseas markets."

The company's sales model will now focus on sales through calls and emails in the bid to reduce operational costs. Multiple inside sales hubs will be created across India from where Byju’S sales associates will reach out to incoming leads through calls, email, and Zoom meetings, it said.

"None of these measures will have any impact on our revenue run rate," Mrinal Mohit, chief executive officer, Byju’s India business said in the statement. "These steps are also meant to prepare the path towards a stellar listing eventually as the world’s largest EdTech company that has turned profitable, eventually."

Following multiple acquisitions including Toppr, Meritnation, TutorVista, Scholar, and HashLearn, the company will consolidate its K-10 business as one business unit as part of its restructuring. Aakash and Great Learning will continue to function as separate organisations, it said.

Byju's aid it aims to hire 10,000 teachers in the coming year, adding to its current strength of 20,000 teachers. "To fuel its growth, the company is expanding its teams along with hiring senior leadership to further build operational strength."

The plan to hire more teachers while firing employees across other departments mirrors that of Ola.

In a statement last month, Ola had said it would let go of 200 engineers, while hiring 3,000 more in a “restructuring exercise” meant to “minimize redundancy and centralise operations". It “temporarily halted” the plan to fire engineers three days later.

Byju’s search for profitability comes as VC-backed early Indian startups have renewed their focus on profitability after going public.

In April, Paytm’s Vijay Shekhar Sharma said he expects the payments platform to break even on operating Ebitda (before ESOP cost) by the quarter ending September 2023, following his company’s poor debut and the following stock plunge.

Zomato, which is trading below its IPO price, too set a similar timeline. The food delivery platform’s Chief Financial Officer Akshant Goyal, said they have set the September 2023 quarter as an “internal timeline for breaking even on adjusted Ebitda at the Zomato level”. That excludes profitability for Blinkit.

Last year, Bloomberg first reported that Byju's aimed to go public via a special purpose acquisition company in the U.S.