Following Prosus’ Letter, Peak XV explains decision to resign from BYJU’s Board
Ten News Network
New Delhi, 26th July 2023: Peak XV Partners, formerly Sequoia Capital India, has addressed a letter to its Limited Partners (LPs) explaining GV Ravishankar’s decision to resign from the board of edtech business BYJU’S.
The VC firm, which is the edtech company’s second-largest institutional shareholder, told LPs that Ravishankar’s decision to stand down from the board was due to BYJU’s lack of transparency in giving business updates and information to investors.
The letter to LPs said, “The marking down of our investments reflects our lack of visibility into BYJU’S up-to-date audited financials and our inability to influence it to take corrective measures.”
They went on to say that BYJU’s management was unwilling to follow the advise of Peak XV’s representative on the board.
Prosus, a venture capital investor located in the Netherlands, made similar comments on Tuesday. The VC fund stated in an official statement that its director Russel Dreseinstock’s decision to step down from BYJU’s board was triggered after it became evident that he was unable to meet his depository obligation to serve the long-term interests of the firm and its stakeholders.
They also stated that the edtech company’s executive leadership regularly ignored Prosus officials’ advice and recommendations on strategic, operational, legal, and corporate governance issues.
Prosus’s statement said, “Despite repeated efforts from our Director, executive leadership at BYJU’S regularly disregarded advice and recommendations relating to strategic, operational, legal, and corporate governance matters.”
It further added, “The decision for our Director to step down from the BYJU’S Board was taken after it became clear that he was unable to fulfil his fiduciary duty to serve the long-term interests of the Company and its stakeholders.”
Peak XV also stated that they intend to reduce the value of their stake in the company.
The letter said, “We plan on significantly writing down our investment in the company in the coming reporting cycle.”
