The Chinese Communist Party virus epidemic has hit many industries in China hard. The first to bear the brunt is the long-lease apartment and education tutoring industries, which have been plagued by recent crashes. After Yusheng Education and Weber English, another major education tutoring provider, Xuebajun, is in financial crisis and has been unable to pay its staff since the end of last year. The organization has 50,000 paying students, and during the past double 11 and Double 12, it also encouraged parents to spend a lot of money to buy classes. At present, Zhang Kailai, CEO of Xuehuajun, has issued an open letter of apology, saying that he will not run away, and that the problem will not be solved without bankruptcy, hoping that his peers can take over the staff and students.
Comprehensive mainland media reports, the founder and CEO of Xueba Jun, Zhang Kailai, issued an open letter in his WeChat circle of friends regarding the recent rumors of Xueba Jun’s bankruptcy and collapse in the early morning of January 2. He frankly said that a potential investor was estimating the moral risk after the thunderstorm and couldn’t invest money. This means that Xueba Jun has lost its last external bailout.
The report said that Xuebaun, founded in 2013, is the earliest photo search product in China, which had won the fierce fight in the 2016 search war and is one of the head companies in online education from elementary to high school. Since its establishment, Xuehuajun has experienced 6 rounds of financing, and its valuation once reached $1 billion in the last round of financing in January 2017, officially ranking among online education unicorns. It is saddening to see that it has fallen into such a situation in just four years.
Recently, parents in several provinces and cities reflected that Xueba Jun had problems contacting the lecturer and could not refund the money. A number of Xueba Jun class teachers also said that the company failed to pay salaries on time on payday last December 25, followed by a large number of media reports that Xueba Jun was in trouble.
A parent in Hangzhou was quoted by Phoenix as saying that she only learned of the problems with Xuehuajun after watching the news and could no longer contact the teachers. She spent RMB21,600 on 120 lessons in May, and before she was finished, she was sold another 40,000-plus lessons in December, saying it was a “double 12” offer.
Ms. Song from Zibo, Shandong Province, said she paid the full amount of 17,600 yuan for her child, who had just started his first year of school, for a total of 120 lessons, and was given 55 lessons, for a total of 175 lessons, and now there are 100 lessons left. I thought I would be able to use this platform to make up for my child’s problems, but after just a few months, I had problems.
After that, the class teacher contacted her and said that the teachers had not been paid for two months and were not attending classes. “My side of the light added rights group has six or seven, and qq group, QQ group added a large group is 3000 people.”
A class teacher of the schoolmaster said that the company’s leadership suddenly notified the teachers to find work, “we did not pay this month’s salary, last month’s commission, performance was not issued.” This class teacher is responsible for more than 100 students, from all over the country, the highest contribution of more than 40,000. “For students, there is no specific disposition plan, now we are the same, especially chaotic, the company did not say what is going on, now is the various campuses are withdrawn.”
Classes can not attend tuition fees can not be refunded but also to pay back the loan
Many of these parents took out loans to pay for their children’s tuition, and now they can’t attend classes, can’t get their tuition refunded, and have to keep paying back their loans. How similar this scene is to what happened to tenants who chose to take out rental loans when the eggshell apartment thundered.
In December 2019, to help her child improve his grades, Qingdao’s Ms. Cao looked online for online one-to-one tutoring for primary and secondary schools from Xueba Jun, spending 26,900 yuan to buy 180 lessons for her child, and because the cost was relatively high, on the recommendation of her teacher, Ms. Cao took out an installment loan with Minsheng Bank.
Ms. Cao said, “During the New Year we are always classes, almost until March, the child said this tutoring effect is not too good, we proposed a refund with the teacher, she promised at the time, but delayed to submit to us.” Later on, it was difficult to apply for a refund on the platform, but it was impossible to find the customer service and teachers of Xuehuajun, and the App of Xuehuajun no longer shows any content. The company’s main goal is to provide the best possible solution to the problem.
The CEO of the schoolboy: will not run away
It is worth noting that the news of Xuebajun’s capital chain problems has been fermenting for only half a month, but its founder Zhang Kailai has never publicly explained the incident. on January 2, Zhang Kailai released a long article in his circle of friends, saying that a potential investor was “estimating the moral risk after the lightning storm and could not invest money,” which means that The last external bailout of Xueba Jun is no longer, “the 8-year running Xueba Jun still fell in the winter of 2020.”
In his open letter, Zhang Kailai apologized to the 50,000 students, nearly 30,000 parents who renewed their education, and the more than 3,000 employees, 10,000 teachers, and more than 100 offline agents who “ran with” the company during the past 8 years, which, in his opinion, are “the people that Xueba Jun owes.
Zhang Kailai said that in the past 3 years, Xueba Jun has not financed a large amount of money, at least 5 times wandering in the edge of the collapse of the capital chain, “the most dangerous time, we even late to send teachers 4 days of salary.” In his opinion, his own mismanagement and wrong decisions led to Xue Ba Jun “finally not being able to pull back”.
Zhang Kailai said that there are constantly “government leaders talking to me every day, telling me that I can’t be decadent and that the main body to deal with must still be Xue Ba Jun, to assume the responsibility of the main body of the market”, which also made him make a commitment: Xue Ba Jun will never run away, never shirk responsibility, the problem is not solved not to declare bankruptcy.
In the open letter, Zhang Kailai mentioned the placement of teachers and employees when he said that recently 51Talk, Xuezhi, VIPKid took over thousands of employees and also helped advance the December salary that should have been paid by Xuebajun. But the students’ tuition fees now have no solution way out. He implored the head of the market training institutions, can take over the students of Xuebajun 1 to 1 and Youxue small class, “we are willing to 0 yuan to give away”, in addition, like Xuebajun’s pat search, question bank, class system, he is also willing to give away free, the purpose is to hope that there are institutions to lend a helping hand to accept students.
The Shanghai office property company is persuading users and employees to be diverted to police stations and labor arbitration institutions, while the Beijing office has been locked up and public security officers are on hand to maintain order.
Education and training institutions face a cold winter
Combing through public reports, a number of remedial education institutions in China have closed down or had funding problems in the past two years, such as Weber English, sports class Jumbo Stone Darts, Yusheng Education, talent remedial classes Meiji Meilu, etc.
Public data shows that in the past six months, the number of offline training institutions in the country wrote off 18,885 enterprises, with nearly 100 training institutions written off every day. Related surveys show that 90% of education and training institutions have taken pay cuts and 41% have made layoffs in order to cope with the impact of the epidemic.
IT education institutions such as Brothers in Arms, Funky Journey, Villeroy & Boch and Longen Children’s English have declared “bankruptcy”.
In February 2020, the Chaoyang Park campus of JFJ closed without warning, and according to a coach in the district, many coaches and employees of JFJ have been owed wages since January 2020, and there were more than 100 people in Beijing, including foreign and Chinese coaches. More than 95% have already left.
In early August 2020, a Beijing-based “Qiaohu KIDS” early education institution issued a notice announcing its bankruptcy. Public information shows that Qiaohu is an IP image shaped by the core product of the cartoon “Le Zhi Xiao Tian Di”, derived from a series of products and offline services of the same IP, such as lifestyle products, educational toys, offline activities, early education centers and stage productions. As of November 2019, Qiaohu KIDS authorized 170 stores nationwide in 77 cities. The total amount of course fees owed to students reached millions of dollars how to refund became a big problem.
On June 22, 2020, disney English officially released a message saying that the company would shut down the national Disney English centers and process refunds for parents due to the impact of online education and the uncertainty of the development of the epidemic.
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