From needing solutions to possible revolution, India's MSME story is taking a new turn
On June 6, Byju's initiated a lawsuit against its term loan B lenders, accusing them of engaging in predatory practices. Concurrently, the company did not pay $40 million in interest. Byju's said it would halt further payments since the legitimacy of the term loan B was being disputed.
Shortly thereafter, there was a buzz that three directors – GV Ravishankar of Peak XV Partners (formerly Sequoia Capital India), Vivian Wu from Chan Zuckerberg, and Russell Dreisenstock from Prosus had resigned from the board of the world’s most valued edtech company and India’s most valued startup.
Sources said Byju's' decision to go after its lenders was possibly the last straw, capping months of simmering tensions over the way the company was run. Besides, they may have wanted to avoid the liabilities associated with being a board member under India’s company laws, considering the startup’s delay in filing FY22 (2021-22) financials, which typically leads to a penalty being levied on directors, but more importantly, damages their reputation.