New Delhi: Key shareholders of Byju’s, including Prosus NV and Peak XV Partners, voted on Friday to remove its founder as CEO, intensifying a battle over the future of the once-prominent online tutoring startup.
Byju’s contested the resolutions, which also aimed to oust Byju Raveendran from the board of the company he established in 2015, according to a statement released by the company on Friday.
“The resolutions passed during the recently concluded extraordinary general meeting, attended by a limited group of shareholders, are deemed invalid and ineffective,” the statement read.
While a spokesperson for Prosus declined to provide a comment, Peak XV Partners did not immediately respond to a request for comment.
The vote signals further discontent with the previously lauded entrepreneur, who abstained from the meeting. This development adds a unique twist to an ongoing dispute between a company once hailed as one of India’s most valuable startups and a group of influential investors who supported its growth prior to the Covid-19 pandemic.
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The shareholders’ decision followed a tumultuous hours-long Zoom call for investors and management on Friday, during which several Byju’s employees attempted to intervene, according to two individuals present. Throughout the meeting, unidentified participants repeatedly disrupted the proceedings with whistles and other loud noises, as recounted by the individuals who requested anonymity.
Byju’s, a trailblazer in online education, has been entangled in a protracted restructuring conflict with its creditors after defaulting on a $1.2 billion loan payment. A subsidiary of the company filed for bankruptcy in the United States following the default.
Raveendran, whose journey from tutor to leading a company once valued at $22 billion captivated a nation infatuated with dynamic tech entrepreneurs, is resorting to increasingly desperate measures to sustain the business after rapid expansion during the pandemic. Byju’s found itself unprepared when the demand for online tutoring waned with the reopening of schools.
Several board members have resigned, and Raveendran has offered his and his family members’ homes as collateral to secure funds for employee salaries. Additionally, the company is issuing new shares at a discount exceeding 90% from its previous funding round to raise capital.
