The chances of failure of businesses in the first 10 years are 65%. It is true that not all businesses will survive till the end. In fact, more than half of new startups fail in their first year only. A business needs a lot of other things to survive apart from funds, of course, funds are the most important factor but without proper planning and execution, and the ability to adjust, even if you have a huge amount of funds, the business is bound to fail.
In recent years, EdTech startups have created quite a stir in the world; naturally, India is not behind in this list. The pandemic has contributed to the boom of EdTech in the startup ecosystem. Several EdTech comapnies have made their name in the industry and some are on the verge to become the next big thing. Then there are other companies, who have faced defeat and have failed to survive in the industry.
Lido Learning is an Indian EdTech company, whose failure was a great shock to the industry. In this article, we will talk about, Why Lido Learning shut down its operations while leaving employees unpaid. So, let’s get started.
“You have to always be vigilant and make sure you’re ready to get on the bandwagon as a need for any new change arises.” - Pooja Agnihotri
About Lido Learning
Reasons for the Failure of Lido Learning
About Lido Learning
Lido Learning is an Indian EdTech company that was founded in the year 2019 by Sahil Sheth. The main motive of the company is to provide education in a revolutionary way through their online platform to Indian kids and develop the education industry.
Live classes are held online through this platform for children. Apart from that, animated videos and interactive games are also included in the platform. Top teachers are provided to them and tests are conducted, to understand the progress of the students. The company is headquartered in Mumbai, India.
The main USP of the company was that every class will consist of only 5 to 6 students so that they can get proper attention. Lido Learning was for the students of KG to Class 12.
Reasons for the Failure of Lido Learning
On 4th February 2022 on a very shocking note, Lido Learning shut down their operations and created a situation where 150 employees of the company’s future faced a big question mark.
The EdTech startup was backed by some of the popular angel investors Paytm founder - Vijay Shekhar Sharma, Myntra founder - Mukesh Bansal, Shaadi.com's founder and Shark Tank India judge - Anupam Mittal, MedLife's founder - Ananth Narayanan, and UpGrad founder - Ronnie Screwvala.
Some of the reasons that lead to the failure of Lido Learning are:
Inability to Raise Funds
Funding is one of the most, if not the most important factor in a business for its survival. Without funding, a company can never function properly. Although Lido Learning was able to raise $24 million to date for their funds from popular investors like Vijay Shekhar Sharma, and Anupam Mittal but due to the pandemic many companies backed out at the last moment who wanted to invest in the startup.
Various deals with the companies like CureFit and ByteDance for investments got cancelled. This resulted in a shortage of funds in the company that lead to financial difficulties.
Teachers and Employees Are Not Paid
Employees are the backbone of any company; a company can fully function with the help of its employees. Now for that, a company needs to take care of its staff properly. The red flag arose in Lido Learning when the teachers and the employees are not given their payments.
The teachers and the staff took to different social media platforms to complain against the company when their salaries were not paid to them.
Some ex-employees also complained who quit were not given their payments as well. Nitish Banka, a lawyer at the Supreme Court also shared the same through his Linkedin post.
As per sources, Lido Learning has already suspended all their operation and emails has been sent to the employees regarding the issue.
Inability to Offer Refunds to the Customers
Another main reason for the failure of this EdTech is that the customers of the company were not served properly, their demands were not met and the service was pretty bad.
When customers wanted to cancel the trial period, some demands were not fulfilled, refunds were not offered to them. After the cancellation of their subscriptions, this led to a bad word of mouth and also got negative feedback from the customers, thus the company lost its reputation.
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Conclusion
EdTech has been able to gather the attention of the world, especially after Coronavirus when people got confined in their own homes, the education system almost got disrupted. EdTech took the advantage of the situation and made a place in the startup ecosystem. Lido Learning was going good at first but the above reasons have led to its shut down as it was not able to adapt after the pandemic.
FAQs
Is Lido Learning shutting down?
The founder, Sahil Sheth has announced that there is no fund left for the business so Lido Learning will shut down its operations in Feb 2022.
Who is the founder of Lido Learning?
Sahil Sheth is the founder of Lido Learning who founded the company in 2019.
How old is Lido learning?
Lido Learning was founded in 2019 by Sahil Sheth.
Who invested in Lido?
Paytm founder, Vijay Shekhar Sharma, CultFit founder, Mukesh Bansal, Shaadi.com's founder and Shark Tank India judge, Anupam Mittal, MedLife's founder, Ananth Narayanan were some of the investors of Lido Learning.
Source :- https://startuptalky.com/ Author :- Damini Bhandary Date :-March 14, 2022 at 11:23AM