BlackRock Slashes Byju’s Valuation to $1 Billion, a 95% Plunge

 “BlackRock Slashes Byju’s Valuation to $1 Billion, Marking a 95% Drop from $22 Billion in Early 2022”

BlackRock has once again revised down the value of its holdings in the Indian startup Byju’s, significantly reducing the implied valuation to $1 billion from $22 billion in the early months of 2022. The asset manager disclosed this latest adjustment, revealing that Byju’s shares were valued at approximately $209.6 each at the end of October last year, a sharp decline from the peak of $4,660 in 2022. Despite periodic disclosures by the asset manager about its portfolio, no explanation is provided for the rationale behind these valuation adjustments, and this latest revision had not been previously reported.

BlackRock, which holds less than 1% of Byju’s, did not immediately respond to requests for comments, and Byju’s declined to provide any comment.

This is not the first time BlackRock has devalued its holdings in Byju’s, and it is not alone in its significant downward adjustments. Prosus, with a 9% stake in Byju’s, had declared a valuation of “sub $3 billion” late last year. At $22 billion, Byju’s was formerly India’s most valuable startup.

This sudden and drastic devaluation marks a remarkable reversal of fortune for Byju’s, once hailed as the poster child of the Indian startup ecosystem. The startup, known for its innovative teaching methods, had achieved valuations as high as $50 billion in the past.

Byju’s, backed by numerous industry leaders and investors, had ambitious plans to go public in early 2022 through a SPAC deal, targeting a valuation of up to $40 billion. However, the geopolitical events, specifically Russia’s invasion of Ukraine in February, led to market downturns, compelling Byju’s to postpone its IPO plans. As market conditions worsened, so did Byju’s business outlook, facing mounting pressure from investors to address unresolved issues.

The company is currently grappling with a range of challenges, including difficulty raising capital, meeting payroll obligations, and addressing a debt exceeding one billion. Byju’s missed its revenue target for the financial year ending in March 2022, as disclosed in a delayed account report last month.

The departure of key figures, such as CFO Ajay Goel, along with the abrupt exits of auditor Deloitte and three board members in June, has added to the company’s woes. Public criticism from investor Prosus in July highlighted Byju’s alleged failure to evolve adequately and its disregard for investor advice, further complicating the startup’s already challenging situation.

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