What Is BYJUS 3.0? CEO Raveendran Explains

BYJU’S, the company once valued at $22 billion, has experienced a steep downfall. In a recent podcast, CEO Byju Raveendran spoke about the expansion missteps and introduced BYJU’S 3.0 — here’s what you need to know.

BYJU’S & Loan Default: Where did it all go wrong?

Raveendran mentioned in the interview that the predominant reason behind BYJU’S insolvency was aggressive expansion due to investor expectations.

These expansion plans included international markets like the Middle East, Bangladesh, Egypt, Iran, and 21 other countries. It also undertook the expansion of Aakash Institute and WhiteHat Jr.

"When we tried expanding from India to the whole world, we made some business mistakes. Maybe we could have taken it a little bit slower. We were growing a little too soon, too fast. We went from India to 21 new countries. But if you ask me, in that context of 2019 to 2021, the COVID era, we have 160 investors, world-class investors, and equity investors. All of them — this was the mandate: grow, grow, grow and change the way kids learn," Raveendran explained.

Insolvency Proceedings

The aggressive expansion led to BYJU’S taking a $1.2 billion loan in November 2021 from US GLAS Trust Company, which was to be paid in November 2026. The trust forced an acceleration of repayment of the loan when uncertainties surrounding BYJU’S were on the rise. During that time, BYJU’S paid 158 crores to BCCI as a settlement of the last 10% of their loans, clearing their defaults, but GLAS Trust opposed the halt to the insolvency proceedings.

Russia-Ukraine War

What propelled the uncertainties for BYJU’S and an obstruction to their expansion plans was the Russia-Ukraine war, which halted major investments and higher interest rates by the FED. This reduced liquidity halts expansion and acquisition plans.

"We were raising money for growth at that time. But when the world changed, when interest rates went up, when the Fed increased the interest rate and, almost simultaneously, the big war started, Russia and Ukraine, suddenly the liquidity dried up. 700 million of committed capital; signed committed capital didn't turn up," he added.

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BYJU’S 3.0: A Step Towards a New Beginning

Despite these challenges, Raveendran has announced the foundations of BYJU’S 3.0. He expressed that in an evolving technological landscape, AI will be utilised in BYJU’S 3.0.

Staying true to their original mission of teaching students, he plans to make learning fun and easy for students while integrating Artificial Intelligence (AI) in learning to complement teachers and enable them to keep up with changing technological dimensions.

BYJU’S 3.0 looks at productizing services using AI to cater to individual student needs, with new strategies to be implemented to improve students by pushing them from one quartile to the next.

"I'm stubborn when it comes to the mission. It's going to be the same. How do we make it easy and interesting for students? How can we use AI not to replace teachers but to enable teachers to become better teachers? How can we move the bottom quartile of students to the next one or the next one?" he added.

He further states that with the current crisis’s implications, they are forced to rethink their business model when asked about international markets of the Middle East, Africa, and Southeast Asia.