Byju Raveendram claimed that the funds had been locked away.
Amidst the ongoing financial crisis in Byju's, company CEO Byju Raveendran on Saturday said that the edtech firm will not be able to pay the salaries of its employees.
Mr Raveendran informed the news to his staffers in an email, wherein he also lashed out at a group of investors for moving a resolution to lock the company's funds in a separate account.
The letter by Mr Raveendran read, “….I regret to inform you that we will still be unable to process your salaries…..Unfortunately, a select few (4 out of our 150+ investors) have stooped to a heartless level, ensuring that we are unable to utilise the funds raised to pay your hard-earned salaries.”
Reasoning the scenario, Mr Raveendran added, “At their behest, the amount raised through the rights issue is currently locked in a separate account.”
He revealed that the funds had been locked away, even after “some of these investors have already reaped substantial profits.”
Mr Raveendran said, “It is an agonizing reality that some of these investors have already reaped substantial profits – in fact, one of them has made a staggering eight times their initial investment in Byju's. And yet, their actions convey a callous disregard for our lives and livelihoods.”
He continued, “Despite our best efforts, we are left with no option but to confront the heart-wrenching reality that we are temporarily unable to provide you with the financial support you deserve.”
Mr Raveendran claimed that the company is trying to ensure that they pay the salaries by March 10.
He said, “We are striving to ensure that your salaries are paid by the 10th of March. We shall make these payments the moment we are permitted to do so as per law.”
Mr Raveendran informed that last month, the company faced challenges in crediting salaries “due to a lack of capital,” and now the firm is “experiencing a delay despite having funds.”
He said, “After all, we now have funds to meet our short-term needs and clear our liabilities. However, I regret to inform you that we will still be unable to process your salaries. Last month, we faced challenges due to a lack of capital, and now we are experiencing a delay despite having funds.”
He concluded by saying, “Countless hours have been spent exploring every possible avenue, engaging our legal teams, and advocating for your rights. However, despite our best efforts, we are left with no option but to confront the heart-wrenching reality that we are temporarily unable to provide you with the financial support you deserve.”
Last month, the primary stakeholders of Byju's made the decision to oust Mr. Raveendran from his position as CEO and remove him from the board of the company he founded in 2015. Byju's has experienced a significant downturn, with a notable decline of around 90% over the past year.