Prosus, one of Bijou's key investors, said on Monday that its stake in the Indian edtech startup once worth $2.1 billion is now worthless, but it remains hopeful that India's once most valuable startup can be rescued.
Prosus, Bijoux’s largest outside investor with a 9.6% stake, said in a quarterly report that the value of its stake in the startup had gone to zero “due to a significant decline in value to equity investors.”Prosus Group Chief Information Officer Erwin Tu said on the earnings call that the company remains optimistic about Bijoux’s prospects but that improving governance at the Indian company will be key.
The Indian education technology giant has been on a rocky path in recent years, grappling with a series of financial and governance setbacks that have tarnished its reputation and jeopardized its future. Its troubles deepened last year when it missed a financial reporting deadline and ultimately reported revenue that was well below its own forecasts.
Its financial stumbles were compounded by the sudden resignations of its auditors and board members, including a Prosus executive, scuttling a potential $1 billion fundraise. Desperate fundraising saw the startup raise $200 million this year, but at a significantly reduced valuation of $225 million to $250 million. The lifeline also comes as the company is embroiled in legal battles with some of Byju's key backers, including Prosus.
Prosus, whose portfolio includes big names like Tencent, Delivery Hero, Swiggy and Stack Overflow, has invested more than $570 million in Bijoux over the years. The company has never sold its stake in the Indian edtech startup, whose valuation reached a peak of $22 billion in early 2022. On Monday, Prosus said it had taken an adjusted fair value loss of $498 million on its Bijoux stake in the current financial year.
Image credit: Prosus (screenshot)
Prosus also cut the value of its other investments, writing down the value of its stake in Stack Overflow, which it bought for $1.8 billion in 2021, by 39%, and down the value of its stake in Indian online pharmacy FarmEasy by 35%.
Prosus's readjustment of Visjoux's stake comes after the world's largest asset manager, BlackRock, also wrote down its stake in the Indian education technology startup. Prosus had complained last year that Visjoux “regularly ignored its advice.”