Sahil Sheth, founder of Edtech’s Lido, enters his next show, but the last one is far from over
“Currently, he is building an AI startup that aims to revolutionize healthcare by making it easier for doctors and patients to drive the system. The joint venture promises to deliver transformative efficiency while achieving significant cost savings,” he wrote an article on his profile on his professional networking platform LinkedIn.
According to the latest news about his profile, the joint venture has been in progress for nearly two years and Sheth is now actively hiring the company.
But even as he looks to the future, Lido’s story is far from over and unresolved problems continue to surface.
The ghost of the past
Several former Lido employees, many of them still waiting for unpaid dues, said they had not forgotten. For them, Shiss’ new starting point reminds what’s left, according to two former employees who spoke with Mint.
Himani, a former employee of Lido, waited for nearly two years before losing hope of reconciliation. Himani told MINT: “I plan to file a lawsuit. I can’t let it go.” She still owes close ₹80,000.
Another former employee, Vishal Burnwal, 30, was asked to leave Lido, said he had no choice after the company filed for bankruptcy and Sheth moved to the United States.
“I’ve submitted a lot of FIRs, but I just haven’t gotten any responses. They made us fool us. No one supports us.” Lido probably owe it ₹After the sudden termination, there were 75,000 members of Bernval’s dues.
Himani and Vishal, one of Lido Learning’s nearly 1,200 employees, suddenly resigned in February 2022 without receiving their January salary, citing the company’s financial crisis. Most of them come from sales and marketing teams primarily without repaying their dues, ranging from ₹20,000 to ₹80,000 each, constitutes potential ₹50 million, MoneyControl reported in 2022.
Founded in 2019, Lido Learning promises to provide personalized online coaching and on-site coaching for school students. At its peak, it has more than 1,500 employees and has raised nearly $25 million from well-known investors such as Unilazer Ventures in Ronnie Screwvala.
However, in September 2022, Lido filed for bankruptcy of the National Corporate Law Tribunal (NCLT) judge on the grounds that it was unable to pay payments to employees, suppliers, customers and lenders.
Lido is one of a group of education technology companies that raised funds in the pandemic online learning, but immediately lost its luster as restrictions began to ease.
With investors’ suspicion about the industry, it also made its way into the list of Edtech startups following this, with other companies like Stoa School, Bluelearn and Udayy due to reduced large demand and falls like Byju’s. According to a recent report from Business Standards, over 2,000 startups in the Edtech industry closed stores over the past five years.
But is Lido really closed?
In Lido’s case, while the company did file for bankruptcy, the company never closed.
The last remaining batch of Lido, about 5,000 students, and about twelve employees, found the Second Life in a little-known acquisition of Sri Chaitanya Education Institution, a group of educational institutions in India that absorbed it in its newly launched Edtech Infinity, which absorbed it, and sources within the unlimited range of new information from the company have told MINT.
Today, Infinity has learned its proposition to serve over 7 million learners and has made three known acquisitions: Wizklub, Teacherr, and doesn’t remember. However, it does not mention the role of positives in the company.
“When the company is in a closed state, we attract some team members in the engineering and customer service space. On the other hand, the sole purpose is to tend to meet their needs and ensure their educational journey is seamlessly accessible. No business motivation.
Singh said the batch was taught for a year for free, adding: “There is no formal acquisition or deal.”
This is in June 2022 multiple media reports that Reliance Industries is expected to raise lifeline funds to the company. Mint cannot independently verify that the transaction is passed.
Meanwhile, the bankruptcy case filed by Lido on the NCLT Mumbai bench has been dealt with. According to a notice on the NCLT website of May 8, 2024, the case has been withdrawn by the company.
“Although this matter has been listed several times, it has not been asked because of the scarcity of time. On May 8, 2024, the matter was withdrawn by them,” said Piyush Agrawal, partner at Aquilaw. “As a company fails to pass an order to enroll or start a CIRP (Company Bankruptcy Resolution Procedure), the company can withdraw proceedings without any approval requirements. If the CIRP proceedings are recognized, this withdrawal can only occur after the COC (Committee of Creditors) approves 90% of the vote.”
It is not clear whether the company’s investment was cancelled or a settlement was reached.
According to data from analytics company TracXN, the company is active on the corporate affairs department website. In fact, Lido called for board meetings in 2024, such as ROC fillers. Lido also reported financial status with the MCA for fiscal 24 years. In fiscal 24, positive income fell by 97% ₹26.4 million, while net loss surged to ₹According to TRACXN, the loss of Rs 6.4 crore increased by 1,811% over the previous year.
At the time of publication, multiple requests for comments did not elicit responses. Unilazer Ventures did not respond to a request for comment.
No accountability
In Lido’s case, employees still have legal recourse as the company has not entered the company’s bankruptcy settlement process.
According to Indianalaw LLP Deputy Partner Abdullah Qureshi, an employee or other creditor may submit an application under IBC Section 65 to object to the admission of the company’s petition, alleging that Mala Fide’s intention to violate legal creditors.
“Employee reserves the right to initiate independent litigation under Article 9 of the Code to restore outstanding dues as operating creditors, provided that the amount of debt of each operating creditor exceeds the amount of the debt of each operating creditor. ₹According to Article 4 of the Code, there are 10 million thresholds.
However, such cases raise questions about founder accountability and whether entrepreneurs can restart without shutting down people affected by previous businesses?
Rituparna Chakraborty, co-founder of Teamlease Suffenting, who works closely with startups, is a human resource practice expert, said in this case, despite moral concerns, founders can legally restart, emphasizing how power, networking and technology approaches often outperform employees.
“Founders are able to browse the system because they are either very solid or can build structures that protect them even when employees suffer,” Chakraborty said. “The company is limited liability setting and once a bankruptcy filed, the legal boundaries are obvious. This does not mean it is moral, but legal.”
