BlackRock, which has invested in Byju’s, estimates that its stake in the Indian edtech giant, once valued at $22 billion, is now worthless. The drop in its estimates, disclosed in an SEC filing, has made Byju’s one of the most spectacular startups in recent times.
black Rock exposure It’s been a tough year for the Bengaluru-based startup, which until recently was India’s most valuable startup for the period ending in March this year. Last year, Byju’s struggled to meet its financial reporting deadlines, eventually losing ₹100 crores. Revenue more than 50% less than estimates as it faced various challenges Governance issues,
along with those issues The sudden resignation of its auditor and board members — contributed to the derailment Discussions on raising $1 billion funds,
Prosus, one of Byju’s biggest investors, publicly criticised the startup, alleging that the company routinely disregarded its advice. Amid a funding shortfall, the startup then Raised $200 million at a post-money valuation of around $250 million this year – but investments are being made Legally disputed by some of its largest investors,
So it is not surprising that BlackRock has indicated zero valuation for Byju’s. This is not the first time the asset manager has lowered Byju’s valuation. In late October last year, BlackRock had Byju’s valuation slashed to around $1 billion,
A BlackRock spokesperson declined to comment. Byju’s also declined to comment.
Further, HSBC in a research note also estimated that the value of Prosus’ 10% stake in the Indian startup has eroded so much that its analysts have not bothered to assign a value to it.
In an email to TechCrunch after publication, the spokesperson clarified that HSBC was not attempting to value the entire company, only Prosus’ stake, and that no valuation is not the same as a valuation of zero. However, the research notes chart used zero in the column for estimated value.
The bank also estimated that Prosus’ stake in several other startups — Meesho, Farmacy, Elasticrun and Stack Overflow — is no longer as valuable as it used to be.
“We apply a 50% discount to the latest funding round/acquisition value for assets where the last round is older than six months to take into account the recent improvement in public sector multiples of similar edtech/SaaS companies,” HSBC wrote in the note.
Improvement: This story has been updated to clarify HSBC’s valuation of Byju’s. This story has also been updated to highlight BlackRock’s valuation adjustment of its stake in Byju’s.
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