EdTech decacorn and Indian most valuable startup BYJU’S will ramp up and open over 250 new tuition centres on setting up more physical tuition centres as it is “working very hard” to achieve profitability at the group level by next year, co-founder and chief executive Byju Raveendran said in a year-end note to employees.
While in the latest note, the company didn’t specify a particular month or a quarter on when it is targeting to turn profitable, it did mention in October that it is aiming to achieve the feat by March 2023.
In the financial year 2021, the Tiger Global-backed company’s loss widened to ₹4,589 crore from a loss of ₹232 crore incurred in the fiscal before. It is yet to file its financial results for FY22 with the Registrar of Companies.
To meet its profitability target, BYJU’S has now shifted its focus towards sustainable growth from exponential growth – a change it was expecting only to begin in 2024.
Co-founder & Chief Executive Officer of BYJU’S, Byju Raveendran, said:
The macroeconomic changes of 2022 meant that we had to embark on the path to profitability in the year itself. The prevailing macroeconomic conditions and the integration of our acquired companies made this (layoffs) inevitable. We have also shifted our sales model towards inside sales, which is a result of BYJU’S brand visibility and customer trust.
However, the shift in momentum also forced BYJU’S to lay off around 2500 employees across product, content, media and technology teams. The cost cuts are likely to help achieve better unit economics and prepare the ground for its initial public offering.
BYJU’S recently raised $250 million in a rights issue from its existing investors to fuel its growth. It also bagged ₹300 crore via a collateral-free loan from its wholly-owned subsidiary Aakash Educational Services. At the core of the company’s growth and profitability plans for 2023 are offline education centres. It opened over 300 such centres in 2022 alone and also runs more than 300 Aakash BYJU’s centres. In 2023, the company expects to have a total of 850 offline centres that will serve K-12 and test-prep segments.
The EdTech firm prepares students pursuing undergraduate and graduate-level courses, and in recent years, it has expanded its catalog to serve all school-going students. Tutors on the platform tackle complex subjects using real-life objects such as pizza and cake. The startup claims that it has over 150 million learners using its services.
According to Raveendran, the company will achieve the “elusive EdTech triad,” which includes physical classrooms, digital platform(s), and hybrid centre.
He further added:
We can now serve our 150 million learners through our classrooms, apps and hybrid centres.
In the past two years, BYJU’S has spent over $2.5 billion to acquire startups globally as the Indian firm expands and broadens its offerings in several international markets, Prosus Ventures, a backer of BYJU’S, earlier disclosed in a filing.