Byju Raveendran, the eponymous founder of edtech titan Byju's, has pledged his home and that of his family members to raise money to pay employees as the company faces a cash crunch, according to people familiar with the matter.
Two houses owned by the former billionaire's family in Bengaluru and his under-construction villa in Epsilon – a luxury gated community in the city – were offered as collateral to borrow $12 million, the people said, asking for not to be mentioned because the information is not known. public. The startup on Monday used the money to pay salaries to 15,000 employees of Byju's parent company Think & Learn Pvt.
The founder has pulled out all the stops in his fight to keep the company afloat and alleviate the financial pressure. The company, once India's most valuable technology startup, is in the process of selling its US-based digital reading platform for children for around $400 million. The country is also embroiled in a legal battle with creditors over a missed interest payment on a $1.2 billion term loan.
Raveendran, once worth nearly $5 billion, has racked up personal debts of about $400 million, pledging all his shares in the parent company, according to the people. He also put the $800 million he raised through stock sales in recent years into the company, leaving him strapped for cash, they said.
Last month, Byju's published its first results in years, showing losses at Think & Learn narrowed marginally amid a business boom during the pandemic. An Indian federal agency has also concluded an investigation into the startup's foreign fundraising. Any fines are expected to be nominal, the company said in a statement last week.