Major investor Prosus has written down the value of its 9.6% stake in edtech company Byju’s, signaling a loss of confidence in what was once India’s most valuable startup.
Prosus, Byju’s largest outside investor, has written off the startup “due to a significant reduction in value for equity investors,” it disclosed in its earnings report on Monday.
The once storied Indian tech giant has fallen on hard times, grappling with a series of financial and government setbacks that have tarnished its reputation and jeopardized its future. The startup’s woes were compounded last year when it failed to meet financial reporting deadlines and ultimately reported revenue less than half of what it had forecast.
The financial stumble—exacerbated by the sudden departures of its auditors and board members, including a Prosus executive—derailed a potential $1 billion fundraising effort, TechCrunch previously reported. In a desperate bid for capital, the startup raised $200 million in investment this year, but at a drastically reduced valuation of around $225-250 million. That lifeline has since become embroiled in legal disputes with some of Byju’s biggest backers, including Prosus.
Prosus — whose high-profile bets include Tencent, Delivery Hero, Swiggy and Stack Overflow — has invested about $500 million in Byju’s over the years. He never sold any stake in the Indian edtech startup, which was valued at $22 billion early last year. Prosus said the fair value recorded for Byju’s in FY24 was $498 million.
Prosus also reported a decline in value in other investments. Stack Overflow, bought for $1.8 billion, was down 39%. The group’s stake in Indian online pharmacy PharmEasy fell by 35%, Prosus said.
The company’s revaluation of Byju’s stake follows BlackRock, the world’s largest asset manager, also recently delisting its stake in the Indian edtech startup. Prosus last year complained that the Indian start-up had “regularly ignored its advice”.
