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HomeFeaturesByju’s to Lido, India’s Edtech sector is leaking complaints. Unchecked power, no...

Byju’s to Lido, India’s Edtech sector is leaking complaints. Unchecked power, no trust

There are 3,833 complaints against Byju’s, of which 1,403 have been resolved. Simplilearn has 390 complaints, but only 197 have been addressed so far.

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It took eight months for 16-year-old Vipul Singhvayya from Haryana’s Rohtak to become disillusioned with the promises of EdTech. All he had to show for it at the end was a malfunctioning tablet he claimed to have purchased from Byju’s. Around 1,400 km away in Mumbai, another parent felt ghosted by Lido Learning after plonking down Rs 35,000, only for the company to declare bankruptcy and shut shop.

India’s behemoth educational technology or EdTech sector—which analysts predict will have 37 million paid users and be valued at $10.4 billion by 2025—is leaking complaints. EdTech platforms promise to revolutionise traditional classroom learning with online courses and state-of-the-art equipment, but forums like Voxya and now have dedicated pages detailing user grievances. In December, the National Commission for Protection of Child Rights (NCPCR) issued summons to Byju’s founder Byju Raveendran over allegations of the platform “indulging in malpractice” to lure parents into buying their courses.

There are 3833 complaints against Byju’s, of which 1,403 have been resolved. Simplilearn has 390 complaints, but only 197 have been addressed. And of the 242 complaints about the EdTech-platform Marrow, only 75 have been resolved. Similarly, 168 people have raised objections about PlanetSpark, but only 36 have been taken care of. The now-defunct Lido Learning has more than 121 grievances against it.

Most complaints are about people failing to get a refund after the trial period ends and students unable to access course content despite paying for it. Some grievances are about platforms like Lido Learning, which closed shutters after charging full-fee for its courses.

According to industry experts, this litany of grievances is just an indication of everything that went wrong with the sector.

Vipul watching his Byjus sessions on his mother's phone.
Vipul watching his Byju’s sessions on his mother’s phone | Soniya Agrawal, ThePrint

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The rise of EdTech in India

During the Covid-19 pandemic, EdTech platforms became the mainstay of India’s education system. But by 2022, waves of the virus started ebbing in intensity, schools reopened, offline learning took precedence, and layoffs followed.

Even the Indian government, in January 2022, issued an advisory asking citizens to be cautious before signing up for online courses and not click on the auto-debit feature offered by companies.

“Do not trust the ‘success stories’ shared by the EdTech companies without proper check as they might be a trap to gather more audience,” MoS for education Dr Subhash Sarkar had said at the time.

A school boy attending his online class | Soniya Agrawal, ThePrint
A school boy attending his online class | Soniya Agrawal, ThePrint

“The reason why we saw such a massive bubble build-up was because there was massive capital chasing a select few companies,” said Gouri Gupta, director of the EdTech vertical at the Central Square Foundation, a nonprofit organisation working to ensure quality education in India.

EdTech platforms have been trying to rebuild relationships, improve content and plug their leaky operations. For one, they’ve formed a self-regulatory body, the India EdTech Consortium (IEC), to protect consumer interests and streamline operations.

“In the last 10 months, IEC has introduced a structure to record complaints and encouraged stakeholders to register if they are not satisfied with a particular product or its advertisements,” said Mayank Kumar, founder of EdTech platform UpGrad. He claims that the consortium has been working to resolve issues and has addressed numerous challenges in the first year of its operations.

“The IEC has built strong checkpoints and resolved over 95 per cent of customer complaints while also collaborating with important industry stakeholders to streamline advertisements and brand communications. We see this as a sign of progress,” Kumar further added.

But complaints are still pouring in.  While the IEC is a step in the right direction, calls for more oversight from the government have only grown louder.

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Hassled customers demand justice

Manpreet Kaur, a farmer’s wife from Punjab, saved for months to buy an online Byju’s package for her daughter, who is in primary school. But her heart sank when she discovered it would cost her Rs 1 lakh. Opting for the most economical package, Kaur made a downpayment of Rs 5,000 and applied for a loan to cover the rest of the cost. However, her loan was stalled, and she had to cancel the subscription. She also eventually lost her deposit after failing to pay for a new package.

“I want my daughter to be at par with her contemporaries in the big cities,” she said, adding that the deposit money was part of her savings.

Girish Kannuri from Maharashtra’s Chandapura thought he was being cautious when he only signed up for a trial session of the NEET (National Eligibility cum Entrance Test) course for his nephew on Byju’s.

“They approached my nephew, a Class 11 NEET aspirant. They said we could enroll for a trial and then, in 15 days, decide if we wish to continue. On the 13th day, I wrote to them asking for a cancellation,” said Kannuri, who had checked the auto-debit option. But his requests–emails and phone calls—went down a black hole. Four months passed with no resolution. He allegedly even started getting calls from third-party collectors.

“I had stopped keeping money in the bank account linked to the Byju’s subscription. The EMI amount meant to be auto-deducted was about Rs 5,300. The third-party financier would monthly call me and ask me to pay the EMI, or my CIBIL score would be affected,” he said.

Finally, spurred by frustration and desperation, he complained on Twitter, which was when Byju’s terminated his account.

After the NCPCR summons, Byju’s introduced an affordability test for all potential customers. Now, a threshold family income of Rs 25,000 per month is necessary to move forward with the purchase. Those who cannot prove it automatically qualify for Byju’s Education For All (EFA) programme, where they can access the required content free of cost.

“The emergence of the post-pandemic world required us to give a fresh look at how we engage with our customers in the initial stages of a potentially lifelong relationship,” said Mrinal Mohit, CEO of Byju’s India. He did not address the complaints raised by Kaur, Kannur and others ThePrint spoke to, but expanded on the company’s commitment to a “transparent sales mechanism” and an approach that precludes “potential/rare mis-selling.”

But by the time the safeguard was introduced, it was too late for a single mother from Ahmedabad’s Jamalpur. The woman, who does not wish to be named, mortgaged her jewellery to buy packages from Byju’s for her two daughters.

“I will do anything to ensure that my girls do not have to live the life I do. My elder daughter dreams of becoming a pilot one day. As a mother, I have to make sure I do everything possible to help fulfil her desires,” she said. While the 34-year-old mother does odd jobs like sewing and cooking to pay the EMIs on her mortgage, she often ends up borrowing money from employers to make ends meet.

Krishna Kumar, the founder of Simplilearn, writes off “paid consumer forums” as “just noise, trying to make revenue”.

“The cost for an EdTech company starts right from advertising to customer executives introducing the course to potential customers. How can we reimburse someone who enrolls in a course, takes the material and months later claims that they are dissatisfied?” said Kumar.

Startups in this sector, like the platform Practically, are more cognisant of the accessibility gap. The AI-learning-led app offers packages priced as low as Rs 250 a month.

“We conducted thorough market research before launching our app. Not only is it very economically priced, we have tried to make learning more interactive for students,” said Mahadev Srivatsa, a senior executive with the app. The strategy worked. Within 18 months of its launch in 2018, it racked up 1.5 million downloads and was part of the ‘Top 10 education apps in India’ list on the Google Play Store in October 2021.

“We have also started collaborating with schools wherein teachers can use this app to teach students so that learning can happen seamlessly despite being online,” Srivatsa adds.

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When the bubble burst

The pandemic years saw an aggressive EdTech industry rush in to fill the learning gap that emerged after schools started shutting down. Parents were locked into loans and EMIs but said they had little choice as online classes in many schools were not up to the mark.

Almost overnight, online education platforms rose to popularity.

Businesses were booming on the backs of India’s frantic parents. According to a Mint report, venture funding rose from $500 million in 2019 to $4.7 billion in 2020, of which $1.9 billion flowed into Byju’s alone. In 2021, it increased by another 50 per cent, with funding reaching $6 billion. Startups began popping up, with reports estimating that four of the 10 startups founded in 2021 were in the EdTech sector.

And then the bubble burst.

According to reports, the EdTech sector in India has laid off a maximum number of employees. For one, 16 startups gave pink slips to more than 8,000 employees in January, including unicorns like Byju’s and Unacademy.

Unacademy’s losses reportedly nearly doubled to Rs 2,693.07 crore in the financial year 2022-23. Just two years earlier, in 2020, it had earned unicorn status with a $150 million investment from the Softbank Vision fund. The EdTech firm, founded by Gaurav Munjal, Hemesh Singh and Roman Saini, later sponsored the Indian Premier League (IPL) that same year.

Lido Learning, which was among the worst hit startups, filed for insolvency just five months after raising $10 million from Ronnie Screwvala’s Unilazer Ventures. Others like Udayy, Crejo.Fun, Qin1, and SuperLearn also shuttered operations.

Soon, the flood of customer complaints was bolstered by voices from within.

Aggressive tactics to get more customers gnawed persistently at the conscience of a sales executive from Byju’s—until he quit. “I finally quit after selling a subscription to a petrol pump worker who clearly did not have the kind of income to be able to afford the course. It did not sit well with me to make false promises to a poor man,” said the former employee, who later found work in the sales department of a car manufacturing firm.

This was before Byju’s introduced its new system to evaluate the finance of potential clients. In a 2021 interview with ThePrint, chief operating officer Mrinal Mohit denied the former employee’s claims. “Since these are complaints by former employees, there is a possibility that their sales pitch was not right, which is why they are no longer with us.”

The pressure was so intense that the former sales employee knew he would default on his targets.

“Our sales pitches often included targeting students and asking them really tough questions. It’s a way to show parents that their child really needs Byju’s to get a good education,” he said. The ex-employee also alleges that sales team members posed as counsellors to help pitch the app to parents.

According to Mohit, all counsellors are sales team members, but he rubbished claims that students were asked difficult questions as a tactic to push their products. “Parents are more evolved than this; there is no fooling them,” he said in the same interaction.

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Toxic work culture, abusive managers

The EdTech industry’s problems don’t end here. Employees across platforms have complained of abusive managers, toxic work culture and long hours. A 27-year-old former learning coach with StayQrious preempted the inevitable and quit in July 2022, once downsizing became the norm. The first to go were tutors from non-technical backgrounds who had been roped in as coding instructors after completing a training programme.

“The motive of the company initially was that everyone can code. Ironically, by the end of my service, there were only engineers teaching coaching to students; the rest had been forced to quit,” said the ex-learning coach.

Incidentally, StayQrious– founded by former Byju’s and Khan Academy employee Aanand Srinivas— had raised $2 million as seed funding in 2020. ThePrint reached out to Shree Nanavaty, the company’s marketing director, over mail, calls and messages. The copy will be updated when a response is received.

Bihar-based accountant Arun Kumar, 37, alleged that the Noida-based EdTech firm Extramarks was laundering black money via the company’s accounts during the pandemic to show a growth in student enrollment.

“I was forced to go to work during the lockdown. Not only did they fire me after I refused to participate in the illegal act, they also intimidated me and thrashed me up,” said Kumar, who is fighting on all frontsNot only is he out of work, but also facing defamation charges from the company.

ExtraMarks, a decade-old EdTech firm, provides online learning content in different languages for students from kindergarten to Class 12. In 2022 the company had set an ambitious goal of doubling its revenue to about Rs 1,000 crore. The platform’s vice-president, Arpit Agrawal, confirmed that ExtraMarks had filed a defamation suit against Kumar but declined to comment on the issue citing subjudice.

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Firms trying, but consumers not convinced

For all the unrest, unease and unhappiness, EdTech firms insist that they’ve done more good than harm for students in the country. UpGrad’s Mayank Kumar says that the industry “has proved its mettle” in the two years of the pandemic.

“The EdTech sector has made a positive impact on the learning ecosystem. The number of free learners is 100 times more than paid learning,” argues Simplilearn founder Krishna Kumar. Launched in 2009, the platform says it collaborates with credible institutions like the IITs and Ivy League institutions (such as Harvard, Yale and Princeton) to co-design courses.

But consumer activists, parents and industry watchdogs are not convinced that a sector driven by the bottom line will have the interest of students in mind in their pursuit of profit. There is a growing clamour for more stringent regulations and government intervention beyond advisories and warnings.

“Government leaders understand the role EdTech companies play in making education available, accessible and affordable. The trouble is the profiteering by VC-funded EdTech startups has created a lot of toxicity because of their aggressive mis-selling,” said education advocate Anirudhha Malpani, who has been fighting cases against Byju’s and is a proponent of affordable education for all.

He suggested a Netflix-like subscription system, which empowers the end user, to help bring equity in access. Students can pay a monthly subscription fee of, say, Rs 500 and choose what they want to learn.

The rise of the EdTech sector in India can find parallels in China. Except that Xi Jinping’s government stepped in to clip the wings of local platforms to safeguard the interests of children. In the summer of 2021, during the phenomenal rise of the EdTech sector, the Chinese Communist Party (CCP) issued a rule, which mandated that existing private tutoring companies register as nonprofit organisations. The private online education space, according to the CCP, was promoting educational inequity and increased pressure on students.

Education experts and analysts here agreed that such draconian rules would not work in India and have called for more government regulation instead.

For instance, EdTech platforms can work with state governments to ensure that their content is ratified by the State Council of Educational Research and Training (SCERT). Other suggestions include making it compulsory for EdTech platforms to offer subscriptions that can be renewed monthly rather than offering expensive multi-year subscriptions with discounts.

“It’s also much better for the good EdTech businesses because this keeps the customer service department on its toes, and students are free to switch to competitors because they aren’t locked in,” said Malpani.

There’s no denying that many EdTech platforms have helped students improve their learning outcomes. Yogita Bhodwal, a 17-year-old student from Khidwali village in Haryana, relied heavily on her Vedantu subscription while preparing for her Class 12 board exams when schools were closed because of the lockdown.

Yogita attending her Vedantu class | Soniya Agrawal, ThePrint
Yogita attending her Vedantu class | Soniya Agrawal, ThePrint

“I knew all my teachers, and I really enjoyed the classes. All my doubts were solved immediately,” she said. But her mother struggled to pay the Rs 35,000 course fee.

Gouri Gupta, director of the EdTech vertical at Central Square Foundation, suggested that startups use the ‘post-bubble phase’ to invest in products that aid learning solutions for students across all income levels and democratise learning.

“This way, students in elite private schools and under-resourced government schools get access to similar content,” she said.

A course correction is already underway, but first, EdTech platforms need to rebuild the trust they squandered.

(Edited by Zoya Bhatti)

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