The Busting of an Industry

The estimated value of the the tutoring industry in China prior to the crack down was over 120 billion US. In 2020, there were 32 deal with at least 6.5 billion invested in the sector. Major companies like TAL Education, New Orintetal Education and Gaotu Techedu were listed on US stock exchanges and others were lined up to get listed. VIPKID had hoped to go public with a 4.5 Billion valuation. Investors came from around the World to try and cash in the sector.

Investors included firms from around the world including Alibaba, Black Rock, Baiillie Gifford, Coatue, GGV Capital, Tencent, Sequoia, Tiger Global Management, Trustbridge Partners, Warburg Pincus and many more.

When the guidelines were issued in July 2021 by the General Office of the Communist Party of the China Central Committee and the General Office of the State Council, stocks crashed, deals froze and over 25 online education firms closed. Over a million jobs were lost almost overnight.