Bengaluru: The surge in losses in the year 2020-21 has pushed Byju’s to announce a series of measures to improve profitability, including laying off 2,500 of its 50,000 employees, and reducing marketing spends. The company also announced measures to improve its sales process, following criticism that its sales executives often exert excessive pressure on customers to buy subscription plans for education content.
Byju’s, the highest valued Indian startup and the highest valued education venture in the world, has come under intense pressure following the delay in the announcement of its 2020-21 financial results, and the rise in losses to Rs 4,500 crore in that year, from Rs 262 crore in the year before.
The company on Wednesday said it has integrated all its India businesses that provide content for kindergarten to class 10. These include its acquisitions over the past three years of Toppr, Meritnation, TutorVista, Scholar, and HashLearn. The layoffs, it said, is partly on account of the redundancies created by this integration, and partly because of better use of technology. The layoffs will be across product, content, media, and technology teams.
The company, however, said it will be a net hirer in this financial year, with plans to add 10,000 teachers to its existing teacher strength of 20,000. It said senior leadership talent will also be hired to further build operational strength.
“As a mature organisation that takes its responsibility towards investors and stakeholders seriously, we aim to ensure sustainable growth alongside strong revenue growth. These measures will help us achieve profitability in the defined time frame of March 2023,” Mrinal Mohit, CEO of Byju’s India business, said.
The company also plans to move away from in-person sales and focus more on inside sales. The plan is to use video calling platforms, which it said would enhance customer experience and reduce operational costs. Video calls will enable the company to monitor the actions of its sales force better. The company said multiple inside sales hubs will be created across India from where sales associates will reach out to incoming leads through calls, email, and Zoom meetings.
Byju’s also plans to reduce marketing spends in India. It said significant brand awareness has already been created in the country over the past few years. However, it will retarget some of these budgets to increase brand awareness in overseas markets. The company has built a significant presence in the US through acquisitions, and founder Byju Raveendran has been spending a lot of time in that country over the past two years.
Mohit said while the measures would result in sizable savings, they will not have any impact on the company’s revenue run rate. The company had revenue of Rs 2,428 crore in 2020-21, but expects it to be substantially more in 2021-22.
Two of Byju’s major acquisitions — Aakash Educational Services, which focuses on preparing students for competitive exams, and Great Learning, which focuses on upskilling professionals — will continue to function as separate organisations. The two have doubled their revenues since acquisition, the company said.
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