Last week Prosus, one of the largest technology investors in the world, issued a statement on Byju’s. It said that since it first invested in Byju’s in 2018, the ed-tech company had grown considerably, but “its reporting and governance structures" haven’t evolved sufficiently. Byju’s is India’s most valuable unicorn, or a startup with a valuation of more than a billion dollars.
Prosus also said that the “executive leasership at Byju’s regularly disregarded advice relating to strategic, operational, legal, and corporate governance matters." And this forced Prosus’s director to quit Byju’s board. The investor further said: “We continue to believe in the potential of Byju’s."
A recent report in Mint points out that Prosus is the largest non-promoter shareholder in Byju’s. It has invested more than $500 million in the company and owns close to a tenth of it. While I have no way of knowing what’s going on in the minds of those who run Prosus, this seems like a case of what psychologists refer to as the sunk-cost fallacy or the escalation of commitment.
Prosus has concerns about the “strategic, operational, legal, and corporate governance matters" of Byju’s, which means pretty much everything. It has also said that individuals running Byju’s don’t listen to what it has to say. Nonetheless, despite all this, Prosus says it continues to believe in the potential of Byju’s. This is a great example of escalation of commitment.
Denne historien er fra August 01, 2023-utgaven av Mint Mumbai.
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Denne historien er fra August 01, 2023-utgaven av Mint Mumbai.
Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.
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