The world’s largest asset manager, BlackRock, has further marked down the valuation of Byju’s, three months after it first reduced the value of its holdings in the Indian edtech firm. In a regulatory filing with the US Securities and Exchange Commission for the quarter ended March 31, BlackRock has valued Byju’s at $8.2 billion, which was 62.7% lower than the $22 billion valuation the company was ascribed at the time of its last fundraising in October 2022.
BlackRock owns less than 1% in Think and Learn Pvt Ltd, the parent of Byju’s. In February, the fund manager had slashed the value of its investment in Byju’s. Then it had valued the company at about $11 billion. The edtech firm’s other marquee investors include Tiger Global, Sequoia Capital, General Atlantic, Prosus and Tencent.
Byju’s has been under the scanner for delays in reporting its financial results and over its business practices, including alleged mis-selling of courses. It has also been facing issues with its lenders who have been seeking amendments to the loan terms, as it was reported earlier.
In April, the Directorate of Enforcement conducted searches on several premises linked to Byju’s, as part of a probe into alleged violation of foreign exchange rules over the investments received and transfer of funds abroad by the startup.
Other late-stage startups that have had their valuations revised by institutional investors in recent months include social commerce platform Meesho, fintech firm Pine Labs, online pharmacy PharmEasy, mobility company Ola and food delivery company Swiggy.
In February, it was reported that Byju’s has dismissed another 1,000 employees including several senior executives in verticals like strategy, technology and product. This came after a massive cost-cutting exercise Byju’s initiated last year to streamline its operations, as digital K12 education businesses are finding it difficult to acquire new customers.
In October 2022, the company said it was laying off 5% of its employees totalling around 2,500. The total layoffs, however, are much higher in scale and are said to be in the range of 10,000,.The company had filed its audited results for FY21 after an 18-month delay in
September last year, reporting a loss of ₹4,588 crore, which was 18 times its loss in the previous year. Revenue from operations had been readjusted to ₹2,280 crore, a drop of around 50% from the projected revenue of about ₹4,400 crore cited in unaudited results.
Social commerce platform Meesho’s valuation lowered
Funds managed by Fidelity Investments have cut the valuation of social commerce platform Meesho to $4.4 billion in their books as of March 31.
This is a reduction of about 10% from the $4.9 billion valuation at which the US-based multinational financial services firm had invested in Meesho in September 2021.
Notably, Fidelity’s crossover funds had valued Meesho at $4.98 billion as of December 2022. Prior to that, as of September 2022, the investor had ascribed a valuation of $4.29 billion to Meesho. Crossover funds are mutual funds that invest both in publicly traded and privately held companies. They periodically review the valuations of their portfolio companies.
Fidelity had co-led Meesho’s last funding round with Eduardo Saverin’s B Capital in September 2021, when the social commerce startup raised $570 million at a valuation of $4.9 billion. The funding round had resulted in Meesho’s valuation doubling in less than six months.