The startup’s board cited its inability to pay off debt of ex-employees, customers, vendors, among others, as the reason for filing for insolvency
In February, Lido laid off a majority of its workforce due to a funding crunch, just five months after raising $10 Mn
Earlier this year, the startup was in talks with several investors for funding or acquisition, including Reliance
Beleaguered edtech startup Lido Learning, which has been making headlines for all the wrong reasons since the beginning of 2022, will file for corporate insolvency, regulatory filing accessed by Inc42 showed.
In an extraordinary general meeting held on September 5, the startup’s board has given it consent filing for insolvency pursuant to the provisions of Section 10 of the Insolvency and Bankruptcy Code, 2016 as it was unable to pay off the debt to its ex-employees, customers, vendors, lenders, and sundry creditors.
In June this year, news portal The Morning Context reported that Reliance Industries Ltd was likely to invest in Lido. Reliance came into the picture after Lido’s talks with several edtech unicorns for a possible acquisition deal fell through. However, the latest development has put an end to the speculations of its acquisition.
In February 2022, Lido laid off a majority of its workforce, just five months after raising $10 Mn in a round led by Ronnie Screwvala’s Unilazer Ventures. At that time, Inc42 reported that the startup was in talks to raise a new round of funding. However, the deal never materialised as the lead investor backed out, leaving Lido in lurch.
While laying off the employees, Lido had said that they would receive their due salaries within 90 days. However, months later, there are several posts on Linkedin from former employees of Lido accusing the startup and its founder Sahil Seth of not paying their pending salaries.
The startup, which has raised about $24 Mn in several rounds of funding till date, posted a total revenue of INR 11.3 Cr in FY21, an almost 200% rise from INR 3.7 Cr in FY20, while its loss widened to INR 58.7 Cr, a 34.9% rise from INR 43.5 Cr in FY20.
Lido’s expenses rose to INR 70 Cr in FY21 from INR 47.3 Cr in FY20. The startup hasn’t filed its financial statements for FY22 till now.
The development was first reported by Entrackr