Early in June, Byju Raveendran and Divya Gokulnath were in the spotlight at the World Economic Forum. The husband-wife duo that co-founded edtech behemoth Byju’s was pictured with Aditya Thackeray, a minister in the Maharashtra state government cabinet. They had just signed an agreement with the state to provide free education in municipal schools.
In the last few months, Raveendran and Gokulnath have charted a path into new geographies new geographies The Ken The Byju’s juggernaut heads to US shores Read more . Backed by an aggressive public relations strategy, the company’s moves clearly underline Raveendran’s big-ticket plans to grow globally.
However, the world’s largest education company, the bedrock of Indian edtech and home to over 13 top brands, is at a crucial juncture in its 12-year journey.
The auditing arm of consulting firm Deloitte hasn’t signed off on the edtech’s financial statements for the year ended March 2021, eight independent sources told The Ken. These sources include executives at Byju’s, venture capitalists (VC) and investment bankers with knowledge of the matter.
These sources and others quoted in the story spoke to The Ken on the condition of anonymity. They were either not authorised to speak to the media or didn’t want to be seen publicly commenting on Byju’s.
Byju’s is yet to file its financial reports for the years ended March 2021 and 2022. And while it’s not uncommon for startups to file their financials late, 15 months have passed since financial year 2021 ended. The delay in filing has triggered panic amongst the edtech’s investors and rival edtech leaders. “If Byju’s fails, it will have negative implications for the entire startup sector in India. Over half the VCs have exposure to Byju’s,” says an edtech founder.
Deloitte declined to respond to a detailed questionnaire sent by The Ken.
In response to The Ken’s questions, a spokesperson from Byju’s said the delay was because of “multiple reasons”, including the long list of acquisitions made by Byju’s. They added that the acquisitions—even those after the year ended March 2021—would require auditors to examine whether or not the purchase materially impacts previous financial results and testify accordingly. The spokesperson also blamed a lack of audit bandwidth—the company has seen a 5X scale up in size.
“There is no question of [Deloitte] refusing to sign off on the audit,” the spokesperson said. “If you wait a few days, you will actually see that report,” they added.