In a messy spot! Byju's pauses Lionel Messi partnership amid company turmoil
Byju's had proudly announced Lionel Messi as its global brand ambassador in November 2022, launching a collaborative campaign for 'education for all' under its social impact arm.
FollowIn a surprising turn of events, Byju's, the prominent edtech company, has reportedly decided to halt its three-year partnership with football legend Lionel Messi barely a year after the agreement was inked. Executives close to the matter told Economic Times that the decision stems from a combination of liquidity issues and other critical concerns plaguing the company.
Byju's, renowned for its innovative educational platforms, had proudly announced Messi as its global brand ambassador in November 2022, launching a collaborative campaign for 'education for all' under its social impact arm. The deal, valued at an estimated $5-7 million annually, aimed to leverage Messi's global appeal to promote accessible education worldwide.
However, recent developments within the company have prompted a reassessment of this high-profile collaboration. According to the report quoting insiders, Byju's fulfilled its financial commitment to Messi for the initial year, but uncertainties loom over the fate of the partnership beyond that point. The company is grappling with a liquidity crisis and a host of other pressing issues that have cast a shadow over its future trajectory.
“Bjyu’s paid Messi for the first year; it is yet to be decided whether the deal will be terminated before full term, or whether Byju’s plans to revive the contract in due course. This is on account of the liquidity crisis and other matters of serious concern within the company,” one of the executives was quoted as saying.
In January last year, Messi had written on his Instagram page: “@byjus_app and their world-changing initiative#EducationForAll are helping children from underserved communities with access to world-class educational resources. I believe that this simple initiative has the power to change the world.”
The decision to suspend the Messi deal follows Byju's failure to renew its endorsement contract with Bollywood superstar Shah Rukh Khan, a move believed to be influenced by mutual concerns, including regulatory scrutiny and the company's precarious financial situation.
Byju's meteoric rise in the educational technology sector has not been immune to controversies and setbacks. The company faced public backlash when it announced layoffs affecting thousands of employees just a month before unveiling the Messi partnership. Founder Byju Raveendran defended the decision, citing the opportunity to learn from Messi's influence and global impact.
Despite its ambitious marketing endeavors, including sponsorship of the FIFA World Cup 2022 in Qatar, Byju's finds itself embroiled in a complex crisis marked by shareholder disputes and management challenges. A group of investors has launched a campaign to oust leadership, sparking tensions within the company.
In a letter addressed to employees on February 4, Raveendran reaffirmed the company's commitment to weathering the storm, attributing the challenges to 'vested interests' seeking to undermine Byju's progress.
The decision to halt the Messi partnership underscores the depth of Byju's struggle to navigate turbulent waters in an increasingly competitive market. While Messi remains one of the world's highest-paid athletes, with lucrative endorsements from brands like Budweiser and Mastercard, his association with Byju's now hangs in limbo amidst the company's ongoing turmoil.
As Byju's confronts its internal and external challenges, the fate of its iconic partnerships and its broader mission to revolutionize education remains uncertain. The company's ability to address its underlying issues and regain investor confidence will be pivotal in shaping its future trajectory in the dynamic landscape of edtech innovation.
