BYJU’s founder Raveendran Byju has taken a loan against his home to raise funds for employee salaries. The edtech giant is facing a massive cash crunch.
According to reports, BYJU’s founder Raveendran Byju has pledged his house along with those of his family members to pay his employees’ pending paychecks. This approach would produce revenue to pay the company’s financial responsibilities, particularly staff salaries during the liquidity crunch.
Former entrepreneur Byju Raveendran secured a $12 million loan with two family homes in Bengaluru and an under-construction house in Epsilon, according to sources. Bloomberg said that sources said the monies were used to pay Byju’s parent business, Think & Learn Pvt.,’s 15,000 employees.
An Enforcement Directorate (ED) investigation into potential foreign exchange law violations by edtech giant BYJU and its CEO and co-founder Raveendran Bjyu is nearing conclusion. They could receive a show cause notice. Under the Foreign Exchange Management Act, the federal inquiry agency examined two businesses and one home property in April, including BYJU’s registered company, Think & Learn Pvt. Ltd. Since then, BYJU’s has been investigated.
After press reports claimed the company violated the forex law by Rs 9,000 crore, the company said it “unequivocally denies media reports that insinuates BYJU’s of any FEMA violation”. “The company has not received any such communication from authorities,” BYJU posted on X.
Raveendran Byju and his wife Divya Gokulnath founded the Bengaluru-based e-learning company, which offers early learning, middle school education, and test preparation. For 2021-22, core business operational losses fell to Rs 2,253 crore, the company announced last month.
Conclusion
BYJU founder Raveendran Byju has pledged his home and family members’ properties to settle employees’ pending salary. The move intends to meet the company’s financial responsibilities, including staff salaries during the liquidity constraint. Raveendran secured a $12 million loan with two family homes in Bengaluru and an under-construction house in Epsilon. Payroll for BYJU’s parent firm, Think & Learn Pvt. Ltd.’s 15,000 employees was paid with the monies. An Enforcement Directorate (ED) investigation into BYJU’s CEO and co-founder Raveendran Byju’s alleged foreign currency legislation infractions is nearing completion, with a show cause notice possible. BYJU disputes media claims of FEMA violations.
