Lessons from Byju's will keep investors, board on toes: GSV's Michael Moe

GSV Ventures founding partner and CEO Michael Moe.

In a wake-up call for investors and board members, the recent stumble of edtech decacorn Byju’s has prompted a reevaluation of fiduciary responsibilities within companies, Michael Moe, the founding partner and CEO of venture capital firm GSV Ventures told Moneycontrol.

Moe emphasised the need for increased caution and diligence in ensuring adherence to established protocols.

“It gives people that experience to be a bit more careful, more diligent with making sure things are being done the way they are supposed to. I don't look at it as something that's going to cause the system to dismantle, but I think it's like a healthy experience,” said Moe at the inaugural session at the second edition of the ASU+GSV & Emeritus Summit in Gurugram.

This comes when the edtech sector faces a double whammy of plummeting investments and the fall of the most valued edtech company Byju’s.

"The lessons learned from Byju's has made investors, board members be a little bit more on their toes, and maybe won't be as permissive as it relates to things that are appropriate as a fiduciary. When you're an investor in a company, you have roles, responsibilities, as a fiduciary to help the company," he added.

“It's been painful actually but it is okay as it brings the maturity and growth of the marketplace,” Moe added.

US-based GSV invests exclusively in global edtech startups and manages around $800 million in assets. GSV Ventures has invested in over 11 edtech companies in India and nearly 86 companies globally. Among its portfolio are unicorns such as edtech companies PhysicsWallah and LEAD, as well as the blue-collar job portal Apna.co.

Moe believes that the edtech sector in India will start to see accelerated funding at the midpoint of the year. This follows the expression of strong optimism by Deborah Quazzo, the managing partner of the venture capital firm, regarding the embattled edtech sector in India, during a conversation with Moneycontrol.

Quazzo said that the fundamentals of the Indian education and skills market remain intact, even at a time when there is an overall subdued environment within the sector. When asked about Byju’s, Quazzo said that, while it is crucial to align with the right people, investors may still make mistakes because even the right people can make mistakes.