Byju's, a prominent Indian edtech startup, faces challenges in paying its staff as it grapples with a legal dispute preventing access to recently raised funds. Founder and CEO Byju Raveendran conveyed in an email to employees, seen by Reuters, that due to ongoing issues with certain investors, the company is unable to process salaries on time. Despite completing a rights issue on February 28 to secure additional capital, funds remain inaccessible, leading to delays in salary disbursements.

The dispute involves four investors out of more than 150, including Prosus, General Atlantic, Peak XV Partners, and Sofina, who sought a stay on the rights issue through India's company law tribunal. Consequently, the National Company Law Tribunal directed Byju's to hold the raised funds in a separate escrow account until the matter is resolved. These challenges compound the startup's previous setbacks, including auditor resignations, bankruptcy proceedings initiated by lenders, and legal disputes over loan terms.

Once valued at $22 billion in 2022, Byju's now grapples with governance issues, financial hurdles, and investor dissatisfaction, exemplifying the volatile nature of the startup landscape.