Category Archives: Start-up

The story of the year: the big Byju’s exposé

The story of the year: the big Byju’s exposé

Author Pradip K. Saha talks about his investigation into one of the most explosive stories of the year

For 12 years, Byju’s, one of India’s most valued ed-tech start-ups, aggressively sold dreams of academic success to Indian parents and students. Its valuation crossed $10 billion in 2020 with global investors pumping in money.

This year, Byju’s fall from the ed-tech throne was as staggering as its rise. Signing up the likes of Lionel Messi as brand ambassador, turning a blind eye to complaints of frustrated parents who were unhappy with the learning product, raising multiple rounds of million dollar investments, delaying the revelation of FY21 results, and its subsequent opacity about FY22 and FY23, have each led to Byju’s notoriety.

Its questionable company practices created a sense of cynicism among global investors: funding in the ed-tech sector is, as a result, at an all-time low since 2015. Journalist Pradip K. Saha, author of The Learning Trap: How Byju’s Took Indian Edtech For A Ride, talks about his investigation into one of the biggest stories of the year.

So much has been already reported about Byju’s. So what are the new revelations in the book?

Four years ago, when we at The Morning Context decided to cover ed-tech, the biggest company was Byju’s. It was the bellwether of the entire industry. I wanted to know how this company convinces parents and if it is actually helping anyone. Byju’s draws in the parents and then it’s like going down a rabbit hole. The book goes behind the scenes, includes my conversations with Byju Raveendran [founder of Byju’s], and has a lot of fresh reporting.

It explores how salespersons aggressively sold the product to the economically weak, the toxic work environment, and instances of mass lay-offs.

You have described Byju’s hard push to convince parents to buy the learning app for their school-going children. Please explain why this is problematic?

While I have mentioned case studies of several unhappy parents in the book, there is this one case I haven’t written about: that of an autorickshaw driver in Bengaluru. He told me that a Byju’s salesperson insisted that he buy the app, even when he had no money to pay for it (nearly ₹70,000 for three years with a down payment of ₹15,000). He was told he could pay in instalments. Then there was a grandmother who hoped to help her grandson fare better at school. She was poor, but the salesperson struck a deal. This, however, pricked his conscience, and he quit the company.

What often happens is that children lose interest in the app, and then when parents seek a refund, the salespersons switch off their phones. There is no way to measure the learning outcomes on Byju’s. And that is the biggest problem. That is why it lost customers, people cancelled their subscriptions and the company had to fall back on investors and could not make a profit.

We have no idea about the company’s financials in 2022 and 2023; your investigation also found that phantom fundraising companies had alleged a connection to the Art of Living Foundation.

Byju’s serially raised money from venture capitalists, and the earlier ones such as Ranjan Pai’s Aarin Capital and the Chan Zuckerberg Initiative made a killing by exiting at the right time. With every subsequent round of fund-raising announced, the valuation of the company increased. This is how the game works.

Between 2015 and 2021, Byju’s kept scaling up. It hired more sales people, did more marketing, was the chief sponsor of Indian cricket teams, and signed up the likes of Shah Rukh Khan as brand ambassadors.

On a consolidated basis, the last publicly declared financials of Byju’s show a loss of ₹4,588 crore, 19 times the loss incurred in the previous fiscal. In July 2022, we broke the story of phantom fundraising, and that the announced $300 million from Sumeru Ventures and Oxshott Capital never landed. Media worldwide followed up the story. In an interview after the FY21 results, Raveendran said: ‘who cares about $300 million? I can raise $300 million in a week’.

Raveendran’s arrogance and the funding winter led to a crash in investments in ed-tech in FY23. What impact has the Byju’s story had on the sector as a whole?

A: The unethical practices at Byju’s have dented the confidence of global investors in the Indian ed-tech sector. From an all-time high of $4,165 million in 2021, investments in ed-tech start-ups dipped to $172 million in 2023. But the industry will survive. Now investors in ed-tech are asking questions they never asked before: about profitability and learning outcomes. And that’s a good thing for the sector.




The mindset that brings unlimited willpower

The mindset that brings unlimited willpower

Many people believe willpower is fixed and finite. Yet powerful strategies exist that can help us increase it.

We all face demanding days that seem designed to test our self-control. Perhaps you are a barista, and you have some particularly rude and demanding customers, but you manage to keep your poise throughout. Or maybe you are finishing an important project and you have to remain in quiet concentration, without letting your attention slip to other distractions. If you are on a diet, you might have spent the past few hours resisting the cookie jar while the sweet treats silently whisper “eat me”.

In each case, you would have relied on your willpower, which psychologists define as the ability to avoid short-term temptations and override unwanted thoughts, feelings or impulses. And some people seem to have much greater reserves of it than others: they find it easier to control their emotions, avoid procrastination and stick to their goals, without ever seeming to lose their iron grip on their behavior. Indeed, you may know some lucky people who, after a hard day at work, have the resolve to do something productive like a workout – while you give up on your fitness goals and fall for the temptations of junk food and trash TV.

Our reserves of self-control and mental focus appear to be shaped by mindsets. And new studies suggest powerful strategies for anyone to build greater willpower – with huge benefits for your health, productivity and happiness.

The depleted ego

Until recently, the prevailing psychological theory proposed that willpower resembled a kind of battery. You might start the day with full strength, but each time you have to control your thoughts, feelings or behavior, you zap that battery’s energy. Without the chance to rest and recharge, those resources run dangerously low, making it far harder to maintain your patience and concentration, and to resist temptation.

Laboratory tests appeared to provide evidence for this process; if participants were asked to resist eating cookies left temptingly on a table, for example, they subsequently showed less persistence when solving a mathematical problem, because their reserves of willpower had been exhausted. Drawing on the Freudian term for the part of the mind that is responsible for reining in our impulses, this process was known as “ego depletion”. People who had high self-control might have bigger reserves of willpower initially, but even they would be worn down when placed under pressure.

Research shows that even if you're able to harness willpower to resist temptation, you may have less willpower for a task in the future (Credit: Getty Images)

Research shows that even if you’re able to harness willpower to resist temptation, you may have less willpower for a task in the future (Credit: Getty Images)

In 2010, however, the psychologist Veronika Job published a study that questioned the foundations of this theory, with some intriguing evidence that ego depletion depended on people’s underlying beliefs.

Job, who is a professor of motivation psychology at the University of Vienna, first designed a questionnaire, which asked participants to rate a series of statements on a scale of 1 (strongly agree) to 6 (strongly disagree). They included:

  • When situations accumulate that challenge you with temptations, it gets more and more difficult to resist temptations
  • Strenuous mental activity exhausts your resources, which you need to refuel afterwards


  • If you have just resisted a strong temptation, you feel strengthened and you can withstand new temptations
  • Your mental stamina fuels itself. Even after strenuous mental exertion, you can continue doing more of it

If you agree more with the first two statements, you are considered to have a “limited” view of willpower, and if you agree more with the second two statements, you are considered to have a “non-limited” view of willpower.

Job next gave the participants some standard laboratory tests examining mental focus, which is considered to depend on our reserves of willpower. Job found that people with the limited mindset tended to perform exactly as ego depletion theory would predict. After performing one task that required intense concentration – such as applying fiddly corrections to a boring text – they found it much harder to pay attention to a subsequent activity than if they had been resting beforehand. The people with the non-limited view, however, did not show any signs of ego depletion, however: they showed no decline in their mental focus after performing a mentally taxing activity.

The participants’ mindsets about willpower, it seemed, were self-fulfilling prophecies. If they believed that their willpower was easily depleted, then their ability to resist temptation and distraction quickly dissolved; but if they believed that “mental stamina fuels itself”, then that is what occurred.

People with the non-limited view on willpower did not show any signs of ego depletion: they showed no decline in their mental focus after performing a mentally taxing activity

Job soon replicated these results in other contexts. Working with Krishna Savani at Nanyang Technological University in Singapore, for example, she has shown willpower beliefs seem to vary by country. They found that the non-limited mindsets were more common in Indian students than those in the USA – and that this was reflected in tests of their mental stamina.

In recent years, some scientists have debated the reliability of the laboratory tests of ego depletion, but Job has also shown that people’s willpower mindsets are linked to many real-life outcomes. She asked university students to complete twice-daily questionnaires about their activities over two non-consecutive weekly periods. As you might expect, some days had much higher demands than others, leading to feelings of exhaustion. Most of the participants recovered to some degree overnight, but those with the non-limited mindsets actually experienced an increase in their productivity the following day, as if they had been energized by the extra pressure. Once again, it seemed that their belief that “mental stamina fuels itself” had become their reality.

Further studies showed that the willpower mindsets could predict students’ procrastination levels in the run-up to exams – those with the non-limited views showed less time-wasting – and their ultimate grades. When facing high-pressure from their courses, the students with the non-limited views were also better able to maintain their self-control in other areas of life; they were less likely to eat fast food or go on an impulsive spending spree, for example. Those who believed that their willpower was easily depleted by their work, in contrast, were more likely to indulge in those vices – presumably because they felt that their reserves of self-control had already been depleted by their academic work.

The influence of willpower mindsets may also stretch to many domains, such as fitness. For example, Navin Kaushal, an assistant professor in health sciences at Indiana University, US, and colleagues, have shown that they can influence people’s exercise habits; people with non-limited beliefs about willpower find it easier to summon up the motivation to work out.

A study by Zoë Francis, a professor of psychology at the University of Fraser Valley, found strikingly similar results. Following more than 300 participants over three weeks, she found that people with non-limited mindsets are more likely to exercise, and less likely to snack, than those with the limited mindsets. Tellingly, the differences are especially pronounced in the evenings, when the demands of the day’s tasks have started to take their toll on those who believe that self-control can easily run down.

Research shows people with non-limited beliefs about willpower find it easier to summon up the motivation to work out (Credit: Getty Images)

Research shows people with non-limited beliefs about willpower find it easier to summon up the motivation to work out

Galvanizing your willpower

If you already have the non-limited mindset about willpower, these findings might be a cause for self-satisfaction. But what can we do if we have been living under the assumption that our reserves of self-control are easily depleted?

Job’s studies suggest that simply learning about this cutting-edge science – through short, accessible texts – can help shift people’s beliefs, at least in the short term. Knowledge, it seems, is power; if so, simply reading this article might have already started to galvanize your mental stamina. You might even enhance this by telling others about what you have learnt; the research suggests that sharing information helps to consolidate your own shift in mindset, a phenomenon known as the “saying-is-believing effect”, while also helping to spread the positive attitudes to others.

Lessons in the non-limited nature of willpower can come at a young age. Researchers at Stanford University and the University of Pennsylvania recently designed a storybook to teach pre-schoolers the idea that exercising willpower can be energising, rather than exhausting, and that self-control can grow the more we practice it. Children who had heard this story showed greater self-control in a test of “delayed gratification”, in which they were given the chance to forgo a small treat to receive a bigger treat later on, compared to their classmates who had heard another tale.

One useful strategy to change your mindset may be to remember a time when you worked on a mentally demanding task for the pure enjoyment of the activity. There might be a job at work, for example, that others appear to find difficult but you find satisfying. Or maybe it’s a hobby – such as learning a new piece on the piano – that demands intense concentration, yet feels effortless for you. A recent study found that engaging in this kind of recollection naturally shifts people’s beliefs to the non-limited mindset, as they see proof of their own mental stamina.

To provide yourself with further evidence, you might begin with small tests of self-control that will bring about a desired change in your life – such as avoiding snacking for a couple of weeks, disconnecting from social media as you work, or showing greater patience with an irritating loved one. Once you have proved to yourself that your willpower can grow, you may find it easier to then resist other kinds of temptation or distraction.

You mustn’t expect miracles immediately. But with perseverance, you should see your mindset changing, and with it a greater capacity to master your thoughts, feelings and behavior so that your actions propel you towards your goals.



BYJU’S The Learning App is now a Harvard case study

BYJU’S The Learning App is now a Harvard case study 

The journey of brand BYJU’S, which started off with classroom sessions for test prep to becoming India’s largest education technology company today, is now a Harvard Business School case study. The case study focuses on how brand BYJU’S is changing the way children learn across grades and geographies and how it has used technology along with a unique combination of content, media and technology to enable students across the globe. BYJU’s is one of the few Indian startups to make it to the reputed Harvard business publishing platform, others include Flipkart and Paytm.


Titled as “BYJU’S The Learning App,” this case study will be available for teaching purposes within and outside Harvard. Authored by John Jong-Hyun Kim, a Senior Lecturer at Harvard Business School, and Rachna Tahilyani, Associate Director, Harvard Business School India Research Center, the case studies the growth of the app, its impact on students and how this K-12 app can be used by students globally.

Talking about brand BYJU’S being a Harvard Case study, Byju said, “It is very humbling to have our brand story as a Harvard Business School case study. This further encourages us to innovate and build learning programs to revolutionize education and create a whole new segment of self-paced learners globally. We believe that education is still the best way to make it big for millions of people across the globe. Our efforts are to help children learn better, realize their potential and chart their own life journeys based on their education.”

Byju Raveendran was also invited to take a class at the prestigious Harvard Business School, where he interacted with the class to discuss how learning can be personalized with the help of technology. 




Byju’s Cash Crunch

Byju Raveendran likens current crisis to war on multiple fronts, says true entrepreneur is a war leader

In a leadership huddle, CEO Arjun Mohan unveiled Byju’s 3.0, where he stressed the need to sell the right products to the right people without maximizing sales 

Byju Raveendran, the founder of the embattled edtech unicorn Byju’s, rallied close to 50 of the firm’s top leaders, assuring them that this was a war on multiple fronts that they would ultimately win.

The meeting came amid a precarious liquidity crisis for the once-feted edtech, as it tries to raise money via multiple channels to keep operations going.

“A true entrepreneur is a war leader. What Byju’s is going through can only be seen as a war on multiple fronts against all odds,” he is said to have mentioned during the meeting. Further, he apologized for not being able to give much face time to the team lately.

“My regret is that I am letting down a wonderful team by not providing adequate capital,” he said.

He concluded by assuring that in a few months, Byju’s would begin the journey back to “the heights where it belongs.” He also gave updates on all the key issues that Byju’s has been embroiled in, from the term loan B issue to the ED notice, asset sales, and the current liquidity position.

Byju’s 3.0

While Byju’s has faced flak in the last few years for aggressively pushing its learning products to parents, its CEO Arjun Mohan emphasized the need to sell the right products to the right people without maximizing sales, an approach that he described as Byju’s 3.0

“Byju’s 1.0 was offline, while 2.0 was about tech-delivered context. Byju’s 3.0 will be about deep tech-driven personalization with the right approach and accountability to sales”,  he said.

Byju’s challenges

Byju discussed five challenges that the company faced in 2023.

The first challenge is the litigation surrounding Term Loan B (TLB). He said this challenge should be resolved after the sale of Epic, which is a subsidiary of Byju’s in the US. That sale will also help manage the liquidity crunch the company faces now.

The second challenge is an ED notice received from the Enforcement Directorate. Byju clarified that the notice is related to procedural deficiencies under FEMA and that most of these issues have already been addressed.

The third challenge, according to Byju, is the closure of the ongoing FY23 statutory audit, which is on track to be completed soon.

The fourth challenge was the litigation surrounding the Davidson Kempner (DK) loan raised against Aakash Educational Services Limited (AESL), which has now been resolved with Ranjan Pai taking over the loan. He also said that Aakash is now set for a promising admissions season.

Finally, he spoke about the importance of finding ways to mitigate the impact of these cuts on the business and called on each team member to play a vital role in maintaining business momentum.

Byju’s needs Rs 500-600 crore in cash by March to settle outstanding employee dues, vendor payments, tax department obligations, and BCCI dues. The company is confident in raising this amount through asset sales or by pledging its holdings in Aakash or Think and Learn, a person familiar with the development said.

A second person added that Byju’s has been borrowing from family, friends, and other entrepreneurs in recent months to pay salaries and vendors. The company is falling short of Rs 60-70 crore every month, even as it has brought its costs down. For instance, its wage bill was higher than Rs 300 crore a year ago, and is currently Rs 130 crore now.

At the height of the funding and pandemic-led EdTech boom in 2020-2021, Byju’s aggressively raised funds and acquired companies. It made a record 22 acquisitions both in India and overseas, as it sought to expand from K-12 (kg to class 12) to categories such as test prep, higher learning, and coding. Byju is now counting on selling some of these assets to raise money and keep operations going at its core India EdTech business.

While Raveendran has been keeping investors informed about the company’s financial situation, Money control has learned that he is confident in weathering the liquidity crisis without their help. “There is no term sheet at this point and no question of Byju stepping aside. He has been putting in money in the last 8-9 months for the company to stay afloat,” a third person said.

Beginning of the trouble

Byju’s, which is 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.

The company has laid off thousands of employees in the last 12 months as it was hit by a double whammy of drying venture capital funding and slowing demand for online learning services. Since then, its investor board members have left too, citing differences with founder Byju Raveendran.

It has tried to recoup since then. Its early investor Ranjan Pai plowed in capital, set up an advisory council with veterans such as Mohandas Pai and Rajnish Kumar and elevated Arjun Mohan as CEO. It is also in talks to divest assets such as Great Learning and Epic.


The Valuation Obsession

The Valuation Obsession

There is an obsession with the values that are being placed on companies when they finance. There has always been one but it is worse than ever.

Every day, without fail, I read a headline that so and so company has raised, will raise, or is trying to raise capital at some eye popping valuation.

It would be easy to blame this on the media, which certainly has to shoulder some of the blame for believing that these are important stories to write day after day, week after week, month after month, year after year.

But the media writes what people want to read and talk about.

The problem is us, the tech sector, and the mindset that valuation is the scorecard by which we measure ourselves.

Of course, valuation matters. When GitHub exits to Microsoft for billions of dollars, that matters. It matters to Microsoft’s shareholders who paid that bill. It matters to Github founders and employees who got a pay day. It matters to the investors in GitHub who got a fantastic return on their investment. And it matters to Github users who got a signal about how important the software they are using is to the big tech companies.

You cannot cover that story without taking about the price that Microsoft paid. It is an important part of the narrative.

But interim valuations being put on startups is different. Sure the price that they can finance themselves is interesting. But not more interesting than the products and services they are bringing to market, how they are building their teams and cultures, and the underlying technologies they are using to do that.

And yet we get less and less of those stories and more and more box scores.

It leads to a culture of bragging and topping one another and an obsessive focus on valuation. I’ve heard founders say “if I don’t raise at a billion or more, we will be seen as a failure.” How ridiculous is that? And yet you can see how they can get to that place.

CEOs and their talent organizations frequently tell me that it is easier to recruit people to companies that have raised at eye popping values. This is particularly peverse because the higher the valuation, the less money the employee will make on their equity. But, it seems, the talent market is looking to the investment community to signal to them what companies are worth working for.

It should work the other way around. I like to invest in companies that smart people are joining. Capital should follow talent, not talent following capital.

I know that many will read this and roll their eyes. “Fred doesn’t like the hyper inflated valuation environment so he’s trying to pour cold water on it.” That’s true about me not liking it but we benefit from it as much as anyone.

What I don’t like about this environment is the focus on form over substance and reducing everything to a number. This could be the new normal. This may be life in startup land from now on. Maybe I just need to learn to deal with it.

But I hope not. I hope that people will come to understand that it is what underneath the covers that matters and the headline number is just that. A great way to get you to click on the link and see some ads.