The education industry is in mourning.
Just in July last year, it was announced with a high profile that it had completed 600 million yuan in financing, " start a class, ". Recently, it has been caught in the turmoil of layoffs and suspension of social security payments.
In the wave of layoffs that started in mid-April, some people were owed wages for 2 to 3 months, some were forced to resign, and some had physical conflicts during the process of asking for wages, and thousands of people had their social security benefits cut off. Pay... The vocational education platform "Kaikeba", which is deeply involved in negative public opinion, is even regarded as the next "Ten Thousand Doors University". After
had been surrounded by negative news for a long time, on June 29, Fang Yechang, the founder and CEO of Kaikeba.com, sent an internal letter to employees, and it became a hot search on Weibo. In the letter, he responded to recent negative news.
He admitted that the company's cash gap in the past few months has been around 100 million per month;
"In the past few months, our monthly cash flow gap has been around 100 million." He said that in the past three years, the cash flow gap has been around 100 million. The rapid development has come to an end and has entered a new stage of "cost reduction and efficiency improvement". It is expected that the total team size will be controlled within 1,000 people. In addition, Fang Yechang also said that he is actively saving the company's business, and has accumulated more than 1 billion in debt through personal credit loans, personal investment mortgages, and personal asset mortgages. He has even mortgaged the assets of his wife, children, and parents.
spent all 1.15 billion and had 1 billion in debt. Fang Yechang almost owned his entire family.
html burned through 1.1 billion in 32 years to pay for the "radical payment"
Why are you so short of money?
In fact, just a year ago, it was the darling of capital.
Especially after the " double minus ", after the K12 track has no investment value, investors have turned their money originally invested in online education to the vocational education track.
In July 2021, Kaikeba completed .6 billion in B1 round financing . As for the purpose of financing, Fang Yechang said at the time that it would be mainly used in areas such as teaching and research, product technology development, offline scene construction and organizational construction.
Prior to this, in August 2020, Kaikeba also completed .55 billion in Series A financing jointly invested by Gaorong Capital and Hillhouse Venture Capital.
This means that within one year, Kaikeba received a total of and two rounds of financing of 1.15 billion yuan. In addition, in January 2022, "Mingchun Academy", an interest learning platform for middle-aged and elderly people under Kaikeba, also announced the completion of tens of millions of yuan in financing.
So where did all the money go? The answer lies in the crazy advertising in the course bar.
Let’s start a class. What we are experiencing today is actually paying for the radical strategies of the past. In the past year or so, in order to achieve rapid growth, Kaikeba has adopted the same strategy as K12: substantial staff expansion, money-burning subsidies, huge investment, and the double-edged sword of "agreed classes".
In the second half of 2021, you will see advertisements for class openings from elevators to bus station light boxes to various short videos and social platforms. At its peak, Kaikeba's courses also appeared in the live broadcast rooms of many celebrities such as Li Chen and Hu Haiquan .
burned money and put in money to start the course, step by step to get to where it is today. Fang Yechang also admitted in the letter to all employees: "The rapid development of in the past three years has allowed us to achieve certain results, but it has also laid many hidden dangers for . For example, the business growth model relies too much on a single business domain traffic during rapid model verification. Procurement, as well as the reduction of organizational efficiency caused by frequent organizational changes caused by differences in organizational capabilities required for the development of multiple tracks. "
This is the hidden danger buried in the increase in money burning in the course, but now has exploded.
Vocational education, it is also difficult to write good stories
"Many online education companies have been in such a dilemma before - excessive marketing ended up making ends meet. It is worth noting that compared with the K12 field, the user life cycle of vocational education is shorter and renewal The rate is even lower, so there are very few companies that rely on the high investment customer acquisition model to become profitable." Yao Yufei, the founding partner of Duojing Capital, once analyzed.
In the past, there was Keguan Education and Wanmen University, and in the latter there was the opening of classes. Facts have proved that vocational education will not become a "safe haven" for education companies and capital after the "double reduction" sword falls. ". Even industry giants Zhonggong Education have shifted from the relatively radical expansion model in the past few years to the "winter" contraction model.
Under the influence of the education policy environment, investors' attitudes towards vocational education have also become increasingly Be cautious.
What is certain now is that the school has entered a painful period of adjustment, and layoffs are one of the symptoms.
The crowded vocational education track, the main business that is deeply involved in public opinion, and increasingly cautious investors are all layer upon layer. Under the pressure, there is not much time left for Fang Yechang, but there are many urgent problems.
