In what can be called a major overhaul, China might soon hit the kill-switch on one of its burgeoning industries - Ed Tech.
Yes, reports suggest that China is considering asking companies that offer tutoring on the school curriculum to go non-profit.
And the new regulations also suggest that ed-tech firms can’t go public. They can’t raise funds. They can’t even acquire other educational services.
And the new regulations also suggest that ed-tech firms can’t go public. They can’t raise funds. They can’t even acquire other educational services.
Now, this move could decimate the country’s $100 billion ed-tech industry. But what’s more is that it's not just restricted to ed-tech, they’re clamping down on offline institutes as well. So the question is - why would the Chinese govt impose such harsh curbs?
Perhaps the goal here is to limit the influence of ed-tech companies on the population. In the past decade, they’ve changed the popular perceptions around education.
China has a shrinking labor force & wants to create a skilled blue-collar workforce. However, nobody wants these jobs because the pay and the perception is so bad.
Furthermore, the govt. feels that private tutoring services don’t serve a meaningful end goal.
See, the ed-tech industry was built on the back of the infamous college entrance gaokao exam (kind of like the IIT JEE in India) , forcing kids to spend their entire lives preparing for this one test.
For ed-tech companies, this is a brilliant market opportunity - simply talk about how kids are being left behind without sophisticated tutoring. But, the Chinese govt feels that it may actually limit the country’s potential.
And finally, the exorbitant fees of these institutes saddles parents, so much that they view education as prohibitively expensive, making people reluctant to have more kids.
And the country’s shrinking population has been haunting the govt for a while now, so this is the last thing they would want.
So yeah, the Chinese #government has probably had it with these ed-tech giants and now wants to limit their influence altogether.
So yeah, the Chinese #government has probably had it with these ed-tech giants and now wants to limit their influence altogether.
Like our content? Make sure you check out @joinditto, where we simplify insurance and provide unbiased, personalized advice.
• • •
Missing some Tweet in this thread? You can try to
force a refresh
