Byju Raveendran Pledges Family Homes to Secure $12 Million for Employee Salaries
- ByStartupStory | December 6, 2023
Byju Raveendran, the founder of the ed-tech giant Byju’s, has taken an unconventional step by pledging family properties, including his own residence, to secure funds for paying salaries to employees. Reportedly, Raveendran has pledged two family-owned houses and an under-construction villa in Bengaluru as collateral to borrow $12 million (₹100.07 crore).
The funds raised through this collateral will be utilized to pay salaries to the 15,000 employees of Think and Learn Private, the company that owns the Byju’s platform. The move showcases Raveendran’s commitment to ensuring the financial stability of his workforce.
In its audited results for 2022, Byju’s reported a 6% reduction in operating losses, amounting to 24 billion rupees ($287.95 million), for its core online education business in the fiscal year ending March 31, 2022. Despite this financial performance, Raveendran is proactively exploring avenues to maintain employee salaries.
However, the ed-tech giant has faced challenges beyond financial matters. Last month, the Enforcement Directorate issued show cause notices to Byju Raveendran and Think and Learn Pvt Ltd regarding alleged foreign exchange violations totaling ₹9,362 crore. The central agency accused both entities of contravening the provisions of FEMA by failing to submit documents related to imports, realizing proceeds of exports, and other financial irregularities.
Byju’s responded to the notice, stating that the queries were “solely technical in nature.” The company asserted that it has complied with the eligibility criteria in law for foreign direct investment (FDI) and has filed the requisite documents in a timely manner.
As Byju’s navigates financial intricacies and regulatory challenges, Raveendran’s pledge of personal assets underscores the founder’s commitment to his employees’ well-being amid the evolving landscape of the ed-tech industry.
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