BlackRock slashes Byju's valuation by 95% down to $1 billion

BlackRock slashes Byju's valuation by 95% to $1 billion

BlackRock has yet again slashed the valuation of its portfolio company Byju’s in the third instance of such markdown since 2023.

According to the firm’s semi-annual report, BlackRock which holds less than 1 percent shares of Byju’s, has cut down its fair value effectively valuing the embattled edtech company to $1 billion from the $22 billion mark set in early 2022, as of October, 2023.

The asset management company earlier reduced the fair value of Byju's by 62 percent, valuing it at $8.4 billion in May 2023. TechCrunch was the first to report on the development, noting that the asset manager reduced the valuation based on certain disclosures.

This comes in a series of valuation downgrades by Byju’s’ investors over the past year. Most recently in November, tech investor Prosus marked down the value of its stake in Byju's, resulting in a company valuation of less than $3 billion, representing an 86 percent decline from the previous valuation of $22 billion.

Byju’s, India's most-valued startup, has been under fire since the start of 2022 for a range of issues including accounting irregularities, alleged mis-selling of courses, and mass layoffs. Since then, its investor board members have left too, citing differences with Raveendran.

The company has laid off thousands of employees in the past two years as it battled a double blow of drying venture capital funding and slowing demand for online learning services.

A senior executive from Byju’s’ new auditing firm MSKA and Associates said recently the company now faces an issue continuing as a going concern. A going concern is an accounting term for a company that has the resources to continue operating for the foreseeable future, in this case, the next 12 months.

Also Read: Byju’s cutbacks: Employees struggle with deteriorating workplace amid massive cash crunch