BYJU's scammy past and all its acquisitions
Created on 26 Apr 2022
Wraps up in 5 Min
Read by 8.8k people
Updated on 25 Aug 2022
We are talking about India’s most-valued startup, its value pegged at $22 billion as of December 2021. BYJU’s has risen to the top, and has been dragged through the mud, all so that it could rule the ed-tech domain in India.
But has it been an ethical ruler who was gallant in its operations, or was it the ruler who craftily manipulated the market and its clients and maybe other companies too?
This Decacorn startup has acquired 10 big names in 2021 itself, and since 2015, a list of 19 brands has been laid under this giant. Let us take a look at how it became what it became!
How BYJU’s started
On December 2021, BYJU’s had over 115 million registered students. But the year BYJU’s was formally founded- 2011, they had just 1000 students. The founder himself, would travel from city to city across the whole country and take sessions in stadiums or whatever could accommodate large batches.
But this setup limited his scalability. He realized the need to go online. There was only so much he could travel and so many classes he could take. And thus, the first popular EdTech was born in India.
BYJU’s was born, not as BYJU’s but with the name- “Think and Learn”. The BYJU’s learning app was launched later in 2015.
The man we are talking about is the CEO and co-founder of BYJU’s, Mr. Raveendran Byju. A multiple-times CAT 100%iler who began coaching students by traveling across the country would then take the stint online along with his wife, Divya Gokulnath. What could be India’s next big ‘Decacorn’ had already sown its seeds!
In case you have doubts regarding the size, it is no Unicorn. But a Decacorn means approximately ten times the size of a Unicorn.
Now, let us begin to explore the little shady side of it.
The Shady Past of BYJU’s
In 2018, BYJU’s became a unicorn, meaning its value touched 1 billion dollars. In just three years, its value is 22 billion dollars. Is the product so good that sales numbers that the numbers proportionally multiplied? Or is it something else?
BYJU’s aggressive go-to-market sales strategy has made quite a headline in the past. BYJU’s has not been selling its product, but rather ‘mis-selling’ it. The salesmen are pushed to bring in more sales and no number satiates the target thrust of the company.
A boy did a coding course from WhiteHat Jr. He then backed a package of 1.2 crores from Google. But, the problem here is, all this information was posted by WhiteHat Jr. themselves, and the boy’s age and package varied in every post. Somewhere it would be mentioned 9 years, and somewhere they would say he is 13. The 1.2 crores package became 20 crores and sometimes even 150 crores. This clearly was a fictional story as a part of their marketing campaign. But people did not check the authenticity of the information. After this campaign, which we can say was quite successful, more than 20,000 people enrolled in WhiteHat Jr.’s courses.
And this happened after BYJU’s acquired WhiteHat Jr. This is what BYJU’s has been doing.
Here is another aspect of the shady side of the business. BYJU’s marketing spend has been through the roof and has only increased every year. From ₹457 crores in 2019, to ₹1175 crores in 2020, you can ponder upon the double-fold increase in just one year. Well, paying Shahrukh Khan could be heavy on the pockets, we imagine. The aggressive marketing on every platform is just the tip of the iceberg. Behind these marketing ads are the salesmen.
Suppose you search for an answer to an academic question on Google. It is most likely that an answer by BYJU’s will be ranked on the first page of the search. When you open it, you’ll have the option of leaving a comment, asking a question or booking a free class; all of which will require your number and email. And that is it. Now that the sales team has your number, they will leave no stone unturned to sell you a suitable course. But before that, wait!
The sales team’s work is half done by the 15-day trial period, which you get by adding your contact number and email. All of your data will be analysed as to how much you study, how you are performing in the tests and then your profile will be pitched to your parents with the scopes of improvement. Parents, being parents, will think that it is good for their child and buy the package.
By chasing huge quotas, aggressive door-to-door selling, and personalized customer meetings for every household, BYJU’s has got themselves 150 million students and 9 lakh paid users. Now, what parents will not realize is that those 9 lakh students study the same material, from the same teacher and take the same quizzes. Children do not get that edge over others that is promised while selling the package.
Well, that wasn’t all. If you still feel BYJU’s growth has been entirely organic, you must be living under some caves. Tata group and Reliance would lose the game to BYJU’s if you were to see how rapidly it has been acquiring companies since its inception!
The long list of Acquisitions
Although BYJU’s became a unicorn in 2018, it has started its acquisition spree before that. In 2017, BYJU’s prominent acquisition was the acquisition of TutorVista and Edurite from Pearson, one of the largest online tutoring brands for school students globally, especially in the US.
Following is the list of companies and the acquisition costs along with them that BYJU’s has acquired over the past few years:
Great Learning- $600 million
EPIC- $500 million
WhiteHat Jr. - $300 million
Aakash Educational Services Ltd.- $1 billion
OSMO- $120 million
Toppr- $150 million
Tynker- $200 million
Scholr- $180 million
Infiken Internet labs Pvt. Ltd. - Undisclosed
Math Adventures- Undisclosed
Vidyartha- ~$500 million
God, show me mercy if I missed anyone on this long shopping list.
The uncertain times and home quarantined people called for an increase in WFHs and online classes. And BYJU’s had become synonymous with online classes. Students couldn’t go to tuition anymore. Online school classes were just that, and lacked proper learning.
A brand that solved all these problems would be a go-to in any market. And that’s all BYJU’s was. Students cannot halt their studies and wait for Covid to pass. The best option they had in front of them was this edtech platform, even if it meant that parents had to take a loan to get their students enrolled for BYJU’s classes.
Nevertheless, BYJU’s has had captured a large share of the market already and from here, it is difficult to scale it. But who knows what the future holds!
Till we meet again.
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