BYJU's - The Edtech Leader's Woes

With subsidiaries bleeding and funding getting tougher to come by, BYJU's faces a critical point in its journey

- Binu Paul

The biggest cost in the edtech business is marketing. BYJU'S is always in the news, for good or bad reasons, which in a way is helping them to be relevant in media. They shouldn't be spending too much on marketing," an edtech founder tells Business Today on condition of anonymity. The acid-dripping joke is a pointer to the heavy visibility of BYJU'S in the media-both in paid advertisements and organically, which has been mostly bad news in recent times. In the past three months, BYJU'S is believed to have laid off 2,000-2,500 employees across group companies; however, the official figure is less than 500. The company also appears to be struggling to meet funding requirements.

To be fair, it isn't BYJU'S alone that is in the news for the wrong reasons. Start-ups across the edtech spectrum are moderating marketing spends and salaries as funding becomes harder to come by and investors start looking at the path to profitability more closely. Layoffs are the order of the day-nearly 6,000 pink slips have been handed out by the likes of BYJU'S, Vedantu, Unacademy, and Lido Learning, among others, since January 2022. Salary cuts and other austerity measures have also started to rain in at these edtech companies. Krishna Kumar, Founder & CEO of edtech Simplilearn, says the sector will grow stronger as demand for digital will only increase, but a lot of moderation will need to happen. For example, hiring people at 100 percent hike in salaries will get corrected now, he says. "Advertising has gone completely crazy, most IPL advertisers were tech companies. This will also moderate significantly now," he says.