BackCost optimization: Byju’s puts on hold campus placement
The company has been rationalizing costs for the last 12 months
PremiumByju’s will opt out of campus placements this year amid extensive cost-cutting measures at the edtech firm that resulted in more than 13,000 layoffs in the past year.
Engineering colleges, including some of the Indian Institutes of Technology (IITs), were in discussions with Byju’s about campus recruitments but have not received confirmation on the hiring schedule on the back of more retrenchments.
“Byju’s is unlikely to hire from any campus this year, and it will take about 6-7 months for the restructuring in the company to get completed. Until then, cost optimization plans won’t allow any hiring," said a senior executive aware of the development.
The company has been rationalizing costs for the last 12 months, and this is the fourth round of layoffs it has announced since last October. More than 13,000 people seem to have been hit by the retrenchment drive.
Another executive aware of the company’s plans said it is unlikely to hire people currently across levels. “The new management and advisers have set in motion a cost rationalization plan that will take Byju’s close to profitability and reduce the burn. Key non-core areas have been identified, and over the next six months, the plan will be executed," he said and added that any hiring, if at all, will happen only next year.
Byju’s had skipped hiring from some of the top IITs last year as well, but some junior level recruitments did happen. Placement teams in the younger IITs were in touch with the company for their recruitments but have not received any confirmation yet. “Even if they had confirmed, it is unlikely that students would be keen to sit for their placements," said a placement team member in one of the youngest IITs.
According to a placement official in one of the older IITs, there are more than a thousand students to place, and while companies are not barred from coming in, their report cards are explained to the students. “There is full disclosure, and students have to make the choice. Often, the campus hiring strategies are different from the overall manpower policies of a company," said the placement official.
Byju’s did not respond to Mint’s queries sent on Wednesday.
The B-school placements typically start from February onwards.
Companies such as Byju’s mainly hire tech and other product roles from key engineering colleges in the country. Facing issues on multiple fronts, such as alleged corporate governance lapses leading to resignations of its non-promoter board members and statutory auditor, slower growth, liquidity crunch and legal tussle with its lenders of Term Loan B, Byju’s has decided to draw up a plan to restructure its businesses. To repay its lenders, Byju’s is exploring the sale of its Epic and Great Learning units.
The appointment of Arjun Mohan, a former chief business officer at Byju’s and the India chief executive of UpGrad, as the new CEO is part of the company’s revival plan. In his internal communications to senior executives, Mohan said the company was looking at cutting around 4,500-5,000 jobs across multiple functions such as sales, marketing, and other areas where significant overlap exists.
“We are in the final stages of a business restructuring exercise to simplify operating structures, reduce the cost base and better cash flow management. BYJU’S new India CEO, Arjun Mohan, will be completing this process in the next few weeks and will steer a revamped and sustainable operation ahead," a Byju’s spokesperson said on Wednesday.
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