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New Delhi: India’s earlier all-star edtech firm Byju’s is taking a further hit after its founder Byju Raveendran was sentenced to six months jail term by a Singapore court in the contempt of court proceedings. The latest development is set to be a further blow to the entrepreneur, who was believed to be one of the biggest success stories of the Indian start-up world.
The multiple reports stated that Raveendran did not comply with several court orders that included the asset and disclosure orders. The orders were reportedly issued in April 2024 and were part of separate proceeding India’s investors and lenders have been involved in with Byju’s.
The court has issued a summons for Raveendran to appear before the court. He has also been ordered to pay around $90,000 in legal costs, which is US$69,400 less than the amount imposed by the apex court in its sentencing. He was also asked to deliver papers to establish that he was the legal owner of a company named Beeaar Investco Pte in the case.
According to reports, it is being linked to a greater legal tussle between the foreign investors who are seeking repayment after the education-technology firm’s downfall. A QIA-affiliated subsidiary is reportedly making a claim against Raveendran in Singapore.
Earlier, Byju’s, also referred to as Think & Learn Pvt Ltd, was recorded as one of India’s top-valued start-ups. The company was founded by Raveendran who went on to establish a brand for online learning when the craze started. The platform has gained millions of students and billions of dollars from investors around the world. Once the peak had passed, Byju’s was listed in the range of USD $22 Billion with its aggressive expansion into overseas markets via multiple acquisitions.
Soon, though, the company started growing fast, leading to a financial crisis. Byju’s had been accused of corporate governance issues, failure to submit financial statements, structuring a massive layoff, unpaid dues and conflicts with lenders. In addition, the company was put under pressure when a $1.2 billion loan issue within the United States got a lawsuit from creditors demanding to have their money repaid.
In the last two years, some investors and board members pulled out of the company. Funds management and company’s financial reporting were also questioned. Such problems cost investor trust and further hamstrung the startup in experiencing a huge cash crunch.
The ruling is being seen as another serious setback to Raveendran’s increasingly mired business empire. In Singapore, contempt of court is taken seriously by the courts, particularly where people are accused of continually not complying with court orders, legal experts say. Raveendran has not made anything official about his new sentencing reports. It remains unclear whether he’s in Singapore now or another country as well.
The collapse of Byju’s has emerged as one of the marquee biggest cautionary words in India’s startup ecosystem. Rising out of legends of the speedy growth of Indian edtech, the answer is a company embroiled in a series of legal cases, investor tussles, and financial problems in several countries. Insiders of the industry are of the opinion that the verdict in these pending cases could impact the investment confidence in the start-up industry in India in the future.
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