Unpaid dues to its teachers and employees, mass layoffs, inability to offer refunds on cancelled subscriptions, and a funding crunch — these are learnt to be the troubles that Lido Learning finds itself in, as the edtech startup shut down its business operations, leaving tutors, parents, students, and its employees in the lurch. The company had last raised $10 million in September last year, and has so far raised $24 million in total since April 2019 when it was founded. It is backed by high-profile investors, including Upgrad founder Ronnie Screwvala, Paytm CEO Vijay Shekhar Sharma, and Shaadi.com’s Anupam Mittal, among others. The company is not taking any new signups and is trying to complete classes for students who had already bought its subscriptions, sources said. That, though, is proving to be a challenge as several of its tutors have parted ways with the company after it failed to pay them their dues for the month of January. Lido Learning offered live online classes for the K-12 segment. More than a hundred employees, mostly from its Bengaluru and Noida offices, are learnt to have been fired by the company, current and former employees, that The Indian Express spoke to, said. But even for those that haven’t yet been laid off, the panic has set in. some of these employees haven’t been paid their salaries for January. Earlier in February, Lido Learning organised a town hall where it invited its employees and it was at this gathering that the company’s founder Sahil Sheth informed them that the firm has no funds to run its business and is actively looking to either raise funds or get acquired by another company, sources said. At this townhall, Sheth is also learnt to have announced that the company was looking to sell off its assets to pay dues to tutors and employees. “After the company communicated to us about its financial health, we were all left wondering how it burned through $10 million in about five months,” said an employee of the company. Lido Learning did not respond to a detailed questionnaire until publication. Ronnie Screwvala, whose firm Unilazer Ventures had led the last funding round in the company, also did not respond to texts and multiple phone calls. The development comes as a warning note in India’s booming edtech ecosystem, home to the world’s most valuable edtech firm in Byju’s. It also comes at a time when traditional classes have been disrupted owing to the ravaging coronavirus pandemic, a gap that a number of edtech firms in the country have been claiming to fill. The sector however has come under the scanner lately. In January, Education Minister Dharmendra Pradhan had announced that the government was working on a policy to regulate the edtech ecosystem. Last December, Congress MP Karti Chidambaram had accused edtech companies of engaging in “predatory” marketing practises that “prey upon” the aspirations of poor people who want to give their children a better education. Major edtech companies — Byju’s, Unacademy, Eruditus, upGrad, Vedantu, and Lead School— on their part have swiftly moved to forming a collective called India EdTech Consortium and adopting a self regulatory code of conduct right after coming under the scanner.
