EdTech startup Lido Learning has filed for insolvency and bankruptcy with the Mumbai bench of National Company Law Tribunal, according to the company's regulatory filings with the Ministry of Corporate Affairs (MCA).
Lido Learning's board of directors has passed a special resolution to file an application under section 10 of Insolvency and Bankruptcy (IBC) code 2016.
This comes at least seven months after the edtech firm fired abruptly told 1,200 employees to resign.
“Resolved that pursuant to Section 10 of the Insolvency & Bankruptcy Code, 2016, considering the facts that the company is unable to pay its debts which are due and there are defaults made by the company, the consent of the shareholders be and is hereby accorded to file an application/petition i.e, initiation of Corporate Insolvency Resolution Process by the corporate applicant, be filed before the National Company Law Tribunal, Mumbai Bench so as to resolve its debts,” said the firm's MCA filings.
Lido Learning is backed by high-profile investors, including Upgrad founder Ronnie Screwvala, Paytm CEO Vijay Shekhar Sharma, and Shaadi.com’s Anupam Mittal, among others.
“I haven’t received my two months' salary and incentives amounting to about ₹86,000 despite the company making multiple commitments to pay in the coming months. I even received my full and final settlement calculations from the human resource department, but the money hasn’t been credited yet,” Abhinav Kumar, who worked as a senior business development associate at Lido, told VCCircle.
Several venture capital-backed startups have laid off more than 11,000 employees since the beginning of 2022. After the pandemic-fuelled digitalisation in the past two years, the hiring frenzy has cooled as many cash-guzzling startups saw finances deplete, with investors sharpening their focus on profitability.
Layoffs have been most prominent in the edtech sector. Pink slips were seen even at Toppr and Whitehat Jr, companies acquired by edtech decacorn Byju’s.
Edtech unicorns such as Unacademy and Vedantu have also laid off staff over the past months. LEAD, which joined the unicorn club just earlier in January after raising $100 million, was the latest edtech startup to lay off staff earlier this month.
Early-stage edtech startups such as Lido Learning have also retrenched staff, while learning platform Udayy has shut down its operations and laid off the entire workforce.
Outside edtech, startups such as Meesho, Furlenco, Cars24, MFine, MPL, OkCredit, CitiMall, and Fraazo also have let go of their employees. Notably, most of these startups had raised significant funding in 2021.
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