Embattled edtech company Byju’s has paid salaries to employees in all functions, except sales staff, even as it struggles with shortage of funds.
This comes a day after Moneycontrol reported that the cash-strapped edtech company has rolled out a new policy linking sales staff’s salaries to the revenue they generate every week.
With the new policy coming into action, the company has suspended fixed salaries for its sales staff that includes the Inside Sales and Byju's Exam Prep teams.
To be sure, Byju’s has still not paid a part of salaries for February and March. The company had earlier delayed salaries for both months, paying only a part of the payments to employees later in the respective months. CNBC TV18 was the first to report on the development.
Byju’s mountain of troubles
The development comes as Byju's is facing an acute shortage of funds with Byju Raveendran, the founder and CEO of the company taking on more personal debt to make monthly payroll.
Meanwhile, the funds raised from the recently concluded rights issue is tied up in an escrow account as per orders from NCLT, till the disposal of the above mentioned case. At least seven vendors have also sued Byju's at NCLT to recover their dues.
The company has also initiated layoffs on phone calls, letting go about 100 to 500 employees without putting them on a performance improvement plan (PIP) or having them serve a notice period. Byju's has laid off over 10,000 employees in the last 12 months as it battled a double blow of drying venture capital funding and slowing demand for online learning services. Since then, its investor board members have left too, citing differences with Raveendran.
The company has tried to fix some of the problems since then. Its early investor Ranjan Pai ploughed in the capital, it set up an advisory council with veterans such as Mohandas Pai and Rajnish Kumar and elevated Arjun Mohan as CEO. In the latest development, however, Mohan decided to step down from the position. It is also in talks to divest assets such as Great Learning and Epic.
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