An education tutoring app called Byju’s uses a freemium business model, with free access to information only available for 15 days following enrollment. It was introduced in August 2015 and provided educational materials for children in classes four through twelve. In 2019, an early learning program for classes one through three was introduced. Additionally, it prepares students for Indian exams including the CAT, NEET, and IIT-JEE.
Digital animation videos that last 12 to 20 minutes are used to clarify academic concepts, allowing students to learn at their own pace.
[32] According to Byju, there are 40 million total users and 3 million paying customers annually. The business declared it would release its app in regional Indian languages in 2019. Additionally, an international release was planned.
Latest audited report
Byju’s, the most valuable start-up in the country, issued audited financial results on Wednesday after a lengthy wait. The company reported a loss of 4,588 crore rupees for the fiscal year that ended on March 31, 2021, which was 19 times greater than the prior year.
From 231.69 crore in the previous fiscal year to more significant losses in 2020–21. From 2,511 crores in FY20 to 2,428 crores in FY21, revenue decreased.
However, the firm said that sales in the following year, which ends on March 31, 2022, increased by four times to 10,000 crores, although it withheld information on the year’s profit or loss.
This marks a drop of 48% from the estimated revenue of about 4400 Crore, according to tech firms Think & Learn Pvt Ltd. The firm has maintained intense scrutiny over Byju’s accounting practices.
What went Wrong?
Byju’s co-founder and CEO Byju Raveendran revealed the major reasons behind the huge losses-
- “These revenues have been pushed back by roughly 40%. You can see from the financials that there was no growth between FY20 and FY21 “explained he.
- Mr. Raveendran claimed that while costs were not pushed out, revenue was and that losses had grown as a result.
- Additionally, he added, “There have been acquisitions like WhiteHat Jr. that were fast-growing but loss-making purchases, as losses grew from almost a break-even to 4,500 crores in FY21.
- He claimed that while WhiteHat Jr. has been underperforming, the acquisition of Aakash and Great Learning has paid off handsomely. Their business growth has exceeded pre-acquisition levels by nearly threefold.
- According to Mr. Raveendran, Byju has also halted new agreements due to the shift in the macroeconomic environment in favor of integrating recent acquisitions.
- The company is also looking to defer its IPO (Initial Public offer) due to uncertainty in macro-economic trends.
What do reports disclose?
The $22 billion startup from Bengaluru has experienced a roughly 18-month delay in publishing its audited results due to concerns from Deloitte’s audit division on several problems in the company’s accounting.
Deloitte stated in notes to the audited financial reports, which ET examined, that Byju’s streaming service revenues (the online courses it sells), which were previously completely recognized at contract commencement, have been amended to be recognized as capable of being rated throughout the life of the contract. Additionally, Byju’s has classed the interest on loans it directly grants to consumers but pays on their behalf as a finance expense and calculated against revenues.
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The way ahead
According to Byju, the business has maintained an 80% rate of retention and renewal and is growing its offline centers to help the business.
By the end of this year, the business hopes to build it up to 500 centers across India, where it now claims to have over 200 active centers.
In addition, Byju intends to increase its present staff of 20,000 teachers by another 10,000 over the upcoming year. Currently, the corporation employs something in the neighborhood of 50,000 people. While a global downturn has affected the online education industry, Raveendran claimed he has been able to vary formats and flourish. “My investors remain very enthusiastic… Many ed-tech businesses prospered during Covid, but the industry is currently experiencing a global recession. However, we have been successful in diversifying our product lines. Great Learning and Aakash are both expanding significantly, he added.
