China’s $4.5bn online language learning market is fiercely competitive but Cindy Mi, founder and chief executive of online education company VIPKid, is not easily fazed.
Inspired in part by bad experiences of teaching as a schoolgirl, Mi has forged her own path from an early age, eventually launching a real-time online tutoring company aimed at China’s tens of millions of four- to 12-year-olds. VIPKid connects Chinese pupils with English tutors in North America and Canada.
Charging Rmb130 (£15) for 30-minute one-on-one video sessions focused on a US curriculum, VIPKid has grown rapidly as it taps into China’s large demand for English teaching. The business completed a $200m fundraising in August last year and is valued at more than $1bn.
“Online education is such an amazing opportunity in this era where we can leverage technology to change the way children learn,” says Mi. Her own experience of English began at the age of 13, when she started to teach herself the language. She recalls learning John Denver’s “Take Me Home, Country Roads” and “Yesterday Once More” by the Carpenters, the first English songs she studied.
At 14 she moved from Hebei province, near Beijing, to Harbin in Heilongjiang province in north-eastern China, close to the Russian border. At her new school she had a “very bad experience” with a maths teacher over her education — a clash that she says made her determined to become an educator and help children to develop a love of learning.
Mi left school at 17 and with her uncle co-founded ABC English, a bricks-and-mortar language teaching company, where from the beginning she led business development and campus expansion across China. She says she also found an additional four or five hours a day on top of 14-hour working days to continue her own English education and self-study for an English literature degree.
“In China we have a self-taught system, where you take exams that are equally or more difficult than those of university students,” she says. “[But] it is very hard . . . I think very few students do this.”
Then, from 2010 to 2012, she studied for an MBA at Cheung Kong Graduate School of Business (CKGSB) in Beijing. The course, which included an exchange programme with Cornell University’s Johnson Graduate School of Management in the US, would be instrumental in the development of her early idea that would lead to VIPKid. “I found it fascinating, the possibility to connect teachers and students in real time, one-on-one in an immersive session. It is so engaging,” she says.
Mi decided to study for an MBA because while she had learnt a lot on the job at ABC English — “I had all the street smarts” — she felt a rigorous academic programme taught by business school professors would make her “book smart”. Particularly important were lessons on the ways technology has disrupted traditional industries and classes on business strategy and corporate finance.
CKGSB also instilled the idea that students should not be thinking about just one company, one industry, or even one country, Mi adds. It highlighted the importance of business around the globe. Mi says that being taught to see the world from a “galactic” view — to view the planet as a whole, as if from the moon — helped her to realise that “the world is a big classroom . . . We really need to imagine education for the future and to teach [children] a love of learning.”
CKGSB gives strong support to entrepreneurs, she says. Professors helped with her business plan and students were paired with mentors from the executive MBA, which meant one-on-one time with people who had extensive backgrounds in business. “They would share their experiences and we shared our questions,” she says. The mentors gave students assurance and helped build their confidence, Mi adds.
She was also helped by CKGSB’s “Chuang Community” network — an incubator that encourages students to start their own businesses and collaborate with some of China’s largest internet companies, such as Tencent and Baidu.
In the past 12 months VIPKid has grown from 6,000 to more than 30,000 teachers and has more than 200,000 paying students. A hundred thousand classes are taught on the platform each day. In August, VIPKid launched Lingo Bus, a Mandarin tutoring service for children.
Mi forecasts that VIPKid will have a million students globally within the first quarter of 2019. Revenue for 2016 was Rmb2bn (£227m), with 2017 revenues forecast to reach Rmb5bn (£566m).
With growth comes challenges. One of the biggest has been convincing parents in China that online teaching is effective. “We had to create an entirely new market,” she says, “and build trust through an unending focus on learning outcomes, teaching quality and curriculum.” Mi adds that nearly 70 per cent of new VIPKid customers now come from existing parent referrals.
Online learning is expanding fast in China. According to iResearch, a consultancy, the country’s online learning market in 2016 was worth Rmb30bn and it is forecast to grow 20 per cent a year until 2019 to Rmb52bn.
Since that miserable experience with her maths teacher, Mi says she has put her desire to help children develop a love of learning at the heart of everything she does. “I learnt that through learning a language,” she says. “The global classroom can be a game changer that makes everything different.”
Get alerts on MBA when a new story is published