No way Byjus is making profit.
Byjus said the business will continue to focus on organic growth while reducing costs.
WhiteHatJr, India’s leading coding platform for kids, is set to be let go by Byjus.In the areas of stock, education, and business, the issue of what will happen after Byjus’ recent high-stakes takeover is looming.
What is going to Happen is either Byjus will disown WhiteHat Jr ,which it paid $300 million or will attempt to sell or shut down the top coding platform.
The $22 billion startup with its headquarters in Bengaluru has listed WhiteHatJr as one of its finest acquisitions. In recent weeks, there had been discussions of closing the facility. But a choice has not yet been made, according to Byju’s sources, the company is leaning towards carrying on with the current strategy of concentrating on organic growth.
As schools resumed operations after Covid, activity on the coding platform also dropped precipitously, resulting in a larger discrepancy between WhiteHat Jr.’s acquisition costs and its revenue generation.
Byjus, an edtech unicorn company with a solid global reputation, has been in decline for a considerable amount of time. It does not assist Byjus that the coding platform was a division of WhiteHatJr, which was most recently bought two years ago for a $300 million business valuation. According to sources, Byjus paid less than $235 million for the acquisition process by the time it was over.
One of Byjus’ 17 acquisitions to date, the $300 million WhiteHatJr transaction, had the biggest public prominence. But since then, the new developments in the field of coding platforms have come under great criticism and have lost their prior potential, according to Baijus. The decision was made at a time when the platform is struggling to maintain its growth and is dealing with more competition from edtech firms. According to insiders, the coding platform was previously spending $14 million each month. But, Whitehat Jr. did not generate a profit on its own.
The choice was made a short time after Byjus made significant layoffs in the previous year. As part of a reorganization attempt last year, the company announced job layoffs that purportedly affected 10% of its workforce. Also, it was announced that by laying off employees, about 10,000 teachers will be hired on a contract basis.
In order to reduce costs, the Byjus business cut back on online and print advertising very substantially last year.The sources claimed that even after WhiteHatJr started switching from print and TV advertisements to downstream marketing activities, the costs of running the business were still too high to handle.
A representative for Byjus, however, refuted rumors that Whitehat Jr. planned to close. We don’t intend to shut down, WhiteHatJr. The representative stated, “We are actively analyzing all of our business divisions to ensure they are aligned with our path to profitability. We are optimizing it for organic and efficient growth.
