Byju's: How India's $22 Billion Startup Fell to Almost Nothing

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The short version

Byju's sold online classes to Indian school children and exam takers. During the pandemic, with schools closed, it became the most valuable startup in India, valued at $22 billion in 2022.

By mid 2024 it was in insolvency proceedings, triggered by the Board of Control for Cricket in India over unpaid sponsorship dues of about Rs158 crore, roughly $19 million. Its biggest investors had marked their stakes down to almost nothing.

How does a company fall that far that fast? The ledger shows three things working together: buying growth, borrowing against it, and losing the trust of the people who check the books.

The pandemic boom

When classrooms closed in 2020 and 2021, parents across India looked for anything that could keep their children learning. Byju's was ready. It had an app, a famous brand and a huge sales team.

Investors poured in money. Byju Raveendran later said the company had raised about $5 billion before it took on its big loan. Valuations climbed with every round until they reached $22 billion in 2022.

Buying growth

Byju's used its money and shares to buy other education companies around the world. The largest was Aakash Institute, India's well known chain of exam coaching centres, bought in April 2021 for nearly $950 million, paid 70 percent in cash and 30 percent in shares. Raveendran still calls it "one of our best acquisitions."

Buying companies adds revenue quickly. It also adds costs, managers and complexity. And it does not prove that the original business can pay its own way.

Borrowing against the boom

In 2021 Byju's took a $1.2 billion term loan from foreign lenders. Deccan Herald reports that the lenders included Redwood Capital Management and Silver Point Capital.

Years later, Raveendran admitted the mistake to the press: "we shouldn't have taken this term loan at that time in 2021." He added that the company was "not doing it out of desperation." But a large loan changes the game. Equity investors can wait. Lenders want interest on time, and they have rights when it does not arrive.

Read the ledger

Byju's results for the year ended March 2022 were very late. They were only filed in early 2024, almost two years after they were due. When they came, Business Standard reported operating revenue of Rs5,014 crore and a loss of Rs8,245 crore.

Put simply, for every rupee of revenue, Byju's lost well over a rupee and a half. Its auditor, BDO, flagged the $1.2 billion loan and said a "material uncertainty exists" about the company's financial position.

Spending on marketing was heavy. Deccan Herald points to sponsorship and celebrity deals, including the Indian cricket team's shirt deal with the BCCI and a brand ambassador deal with Lionel Messi.

Trust breaks

In 2023, members of the board and the company's auditor resigned. Major investors including Prosus, Peak XV, Sofina and the Chan Zuckerberg Initiative later accused the company of governance failures, according to TechCrunch. In June 2023 Byju's missed a $40 million interest payment on the loan and then took its lenders to court in the United States.

Valuations collapsed. BlackRock wrote its stake down to zero. In early 2024 Byju's tried to raise $200 million from existing shareholders at a value of about $225 million after the new money, around 99 percent below the peak. Investors fought it in court.

The cricket bill

In the end it was not the $1.2 billion loan that opened insolvency proceedings. It was the much smaller sponsorship bill. On 16 July 2024, India's National Company Law Tribunal admitted the BCCI's petition to recover about $19 million and appointed an interim resolution professional, pushing the founder out of control.

Byju's quickly settled with the BCCI, and an appeals tribunal accepted the deal. But US lenders objected, and on 23 October 2024 India's Supreme Court set that approval aside, sending the case back into the insolvency process.

The fight in America

The lenders also pursued Raveendran in the United States over $533 million they say went missing from a US unit, Byju's Alpha. In November 2025 a Delaware bankruptcy court ordered him to pay over $1 billion. In December 2025 the same court reversed the damages, saying they had not been properly determined, and set a new damages phase. Raveendran denies the lenders' claims and says the funds were not diverted for personal use. The case had not been finally decided when we last checked.

What the ledger teaches

Byju's had real students and real revenue. What it did not have was a business that covered its costs without fresh money. A high valuation let it borrow, and the borrowing gave outsiders the power to pull the plug when the money ran short.

The bigger lesson for any founder is about trust. When results are two years late and the auditor walks out, investors stop believing the numbers, and money stops coming in.

Questions to ask about any fast growing company

• Is revenue growing because customers stay, or because the company keeps buying other companies?
• How much does it lose for every rupee it earns?
• Who has lent it money, and what happens if one payment is missed?
• Are its accounts filed on time, and is the same auditor still signing them?

The ledger

Munshi's noteValuation is an opinion. Cash is a fact. A company that borrows against the opinion can lose everything to the fact.

Sources

1. TechCrunch, 16 July 2024Byju's, once valued at $22 billion, faces insolvency proceedings
2. Business Standard, 23 January 2024Byju's reports Rs 5,014 cr in operating revenue, Rs 8,245 cr in losses in FY22
3. Deccan Herald, 2024How Byju's journeyed from $22 billion to $225 million in less than two years
4. The Tribune (India)Byju Raveendran calls USD 1.2 billion term loan a mistake
5. Business Today, 23 October 2024Byju's BCCI: SC sets aside NCLAT's verdict stopping insolvency proceedings
6. DT Next, 10 December 2025Delaware court reverses $1 billion judgment against Byju Raveendran

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