According to reports, the company invested $30-40 Mn in the FIFA sponsorship, while it spent another $55 Mn on the BCCI sponsorship
BYJU’S bid to cut costs has come after it reported a loss of INR 4,589 Cr in FY21, up nearly 20X compared to FY20
In an email shared with employees, Raveendran said the company would focus more on ‘growth and efficiency’ in the year to come
India’s highest-valued startup BYJU’S has reportedly decided against renewing some branding partnerships with the Board of Control for Cricket in India (BCCI), International Cricket Council (ICC), and Federation Internationale de Football Association (FIFA).
In an interaction with Moneycontrol, BYJU’S CEO Byju Raveendran stated that while the renewal of these partnerships is coming up, the edtech major will refrain from going for the same, given that it has already achieved the kind of brand awareness it needed.
“The biggest optimisation that you will see over the next few months is that you will see us significantly cutting down branding because we think we have achieved the kind of brand awareness which is required for the segment as well as for the company. So you will see us exiting some of those branding contracts,” Raveendran was cited as saying.
The move will save BYJU’S a significant amount of money. According to media reports, the company had invested $30-40 Mn in the FIFA sponsorship during the FIFA World Cup 2022, while it spent another $55 Mn on the BCCI sponsorship.
The development comes as it was widely reported last month that the edtech startup was looking to exit its deal with BCCI, even after it extended the said deal months ago till November 2023 for an estimated $35 Mn.
The move at the edtech comes as it has been looking to cut costs for a while now. BYJU’S bid to cut costs has come after it reported a loss of INR 4,589 Cr in FY21, up nearly 20X compared to FY20. The bid to cut costs has also led to the startup firing 2,500 employees, with nearly 1,500 more across its subsidiaries Toppr and WhiteHat Jr.
At the same time, Raveendran said that the company will only be able to become profitable across the group by the end of this quarter or early next quarter. Further, he added that the edtech would only be fully profitable by FY24.
“At the company level, with a clear focus towards efficient growth and sustainable growth, by the end of this quarter or by early next quarter, our aim is to achieve profitability. Most of the subsidiaries have already turned positive,” Raveendran was quoted in the aforementioned report.
By all accounts, last year was a tough one for India’s largest edtech startup, as the sector in general experienced a double whammy of a funding shortfall with schools and coaching institutes reopening. Amid all this, BYJU’S was surrounded by controversy, ranging from accounting issues to alleged mis-selling of funds.
In an earlier mail shared with the company’s employees, Raveendran said the company would move away from the exponential growth it undertook between 2017 and 2021 and focus more on ‘growth and efficiency’ in 2023.
“While we were expecting this third phase to begin in 2024, the macroeconomic changes of 2022 meant that we had to embark on the path to profitability this year itself. ‘Growth with efficiency’ became our theme for this year. This did not mean investing less, but investing better and prioritising more rigorously,” added Raveendran in the email shared in December 2022.