This is major - Prosus just publically said that BYJU's had improper governance and failed to improve despite their recommendations
"BYJU’S grew considerably since our first investment in 2018, but, over time, its reporting and governance structures did not evolve sufficiently for a company of that scale. Despite repeated efforts from our Director, executive leadership at BYJU’S regularly disregarded advice and recommendations relating to strategic, operational, legal, and corporate governance matters. The decision for our Director to step down from the BYJU’S Board was taken after it became clear that he was unable to fulfil his fiduciary duty to serve the long-term interests of the Company and its stakeholders." https://techcrunch.com/2023/07/24/prosus-questions-byjus-governance-says-indian-edtech-regularly-disregarded-advice/?tpcc=tcplustwitter
Byjus going down is karma for all the unethical shit they did to kids, parents, employees and critics. I will enjoy every moment of their downfall. I feel sad for employees though.
SteepHost15
Stealth
a year ago
Let's go pop them
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Largest shareholder saying this publicly, I wonder if there is any way of recovering from this point
This is going to be the most insane goof up. Byjus really did a number on themselves.
I wonder if they can recover from all this negative PR now. I’m glad didn’t join it during the boom of 2021.
Klutz
Stealth
a year ago
How convenient.
The improper governance and everything else wrong must not have happened overnight. Everyone (including a large investor like Prosus) conveniently brushed everything under the carpet as long as valuation was rising and until BYJUs became a sinking ship. And now to save their own asses before government takes drastic steps, it's abandon ship time.
If someone with so much power and control (aka investor) is unable to enforce change for the good and ensure reasonable compliance, I don't know what to say.
Coming out publicly at this time is just to save one's own ass, and not any great deed
Cafeinatedpragmatist
Stealth
a year ago
This is pure damage limitation from an org like Prosus.
Most "smart" investors start taking secondaries as soon as they start coming across these "improper governances". The reason nobody speaks up is that they want to take out as much money as their can before it becomes too obvious and they are trapped. In this case, Prosus is trapped.
But quite a few "sophisticated" investors made good money in Byju's. It's the same case in other interesting companies in our ecosystem as well.
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Unfair practices in every Byjus department lead to all this. I was part of Corporate Real estate team, and have seen how leaders avoided all advice given by our team and made enough money for themselves to lead a lavish life. All those CRE heads have made crores of rupees in bribe from various landlords and vendors.
Most of them have left company and started their own business
When byjus was expanding offices in Tier 2/3 cities, it was all under the control of Corporate real estate (CRE) leader on which property to take on rent.
They were reaching out to landlord, inflating the rent what was asked by landlord and was asking a commission of 1-2 months rent from landlord. Imagine a landlord having a commercial property which would fetch them a rent of say 5L INR per month, they would ask landlord to quote higher prices (since these leaders have insights into companies budget). They then used to take equivalent monthly rental for landlord. Even for landlord it was a good deal since there is very little requirement in such small cities
When i left, many landlords have themselves confirmed to me over Phone stating name of those people to whome cash was paid. And these properties were later cancelled by Byjus as company was vacating office
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The best case scenario now is Byjus surviving and profitable but with a tainted brand image which will stay with it forever, and thus not suitable for IPO after such endless disasters
The worst case scenario is that not only Byjus will declare bankruptcy and shut down, but large global institutional investors like Prosus, Temasek and Softbank, who were largely responsible for minting unicorn stories in 2021, will never again invest in India story
Badbunny
Stealth
a year ago
Very true. I don’t know if it’s their ignorance or Byjus arrogance
ConcurrentThinker
Stealth
a year ago
So Byjus has been running like a govt department in terms of corporate governance.
This should be part of onboarding in all VC companies operating in India. Just so they know how not to let their companies to operate
BitterPill
Stealth
a year ago
It's not just Byju's though. Indian startup ecosystem in general has very poor governance. Unfortunately we only read/hear about companies when shit hits the roof. We need a mechanism to proactively audit startups for governance, we need reporting that proactively investigates stories of such lapses, investors who can mentor and/or question their portfolio companies to live upto a certain standard of governance, employees who call out their employers as and when possible
Why is it all exploding now! Its been clear that Byju's was going the titanic way since a year or more now. Were investors idiot to not know this? Byju's was a vanity project for the promoters. Byju wasn't satisfied anymore with just a stadium in Bengaluru.
ProteinPancakes
Stealth
a year ago
Be interesting how they get out of this PR nightmare. Surprised a governing body hasn’t acted on this in India yet.
Badbunny
Stealth
a year ago
Earlier one employee says anything they would deactivate their LinkedIn account. Now, I m waiting to see what they are gonna do.
1. Too little too late for Prosus, just a move to reduce liability and distance
2. Byjus will become the next bug VC. Saare paap dhul jaayenge/punya kamaayenge
ObtuseCutie
Stealth
a year ago
Any VC here who can shed light on how things could get this bad in terms of governance in a startup. Especially considering there are multiple VC's on the board.
I guess from an outside perspective it seems like they could have steered the ship in the right direction earlier......is there more at okay here .....maybe someone's experience navigating startup boardrooms would shed light on this cuz a lot of startups are being accused of bad governance.
