Byjus was once considered India’s most valuable startup – a fact that attracted the Swiss private bank Julius Baer, which invested clients’ money. But the value of the education technology company has plummeted by 95 percent.

Offering online tutorials right through to offline coaching, Byjus was seen as the star of the Indian startup scene. The company caught the attention of investors from around the world, especially during the coronavirus pandemic. Billions flowed into the young company, which was valued at $22 billion in 2022.

Vanished Value

But the tide has turned. The company’s value has nosedived by 95 percent after multiple investors reduced their shareholdings over the past few weeks following rumors of alleged irregularities in the accounting and mismanagement.

Financial institutions are now being forced to take action as a result. For instance, Macquarie Capital, a subsidiary of the Australian major banking giant of the same name, has completely written off its investments in Byjus.

Baer Investment Head Sounds Alarm

This was partly due to the actions of a Swiss bank: the Australians came under pressure from Julius Baer. The Zurich private bank is involved in Macquarie Capital with client funds through a co-investment vehicle. According to news agency «Bloomberg», Yves Bonzon, the chief investment officer of Julius Baer, intervened at Macquarie Capital last January and highlighted irregularities at Byjus.

Among the critical points, Bonzon said the company was moving too slowly in the task of revaluing shares and providing information. At the same time, he criticized the fact that Macquarie Capital was still operating with the enterprise value of 2022, which Byjus estimated at $22 billion after other investors had reduced their valuations by up to 95 percent.

Auditor Exits and 1,000 Employees Laid Off

Macquarie initially invested in Byjus in 2021 through MC Global Edtech Investments Holdings. Julius Baer built up a chest of at least $300 million from its clients for the Byju-ded fund, Financial Review reports. When contacted, Julius Baer declined to comment.

Byjus ran into difficulties when the pandemic came to an end. The ending of restrictions led to a slowdown in online learning. Byjus had to lay off at least 1,000 employees last June. Deloitte, the company’s auditors, and several managers have also distanced themselves. And Byjus recently reported an operating loss of 24 billion Indian rupees or around $290 million.