Tutor titan sells ammo for parental arms race
All parents want their children to get into a top global university. Ronald Po is selling access
Close observers of Causeway Bay minibuses may notice the name "Capstone" on many of the vehicles. The educational company that specialises in tutoring and school admissions is on a marketing blitz, a sign that it is expanding.
Capstone founder Ronald Po Wing-hong, 34, was born in Hong Kong and raised in Queens, New York, by a self-described tiger mum.
Showing his entrepreneurial streak early, at 13 he sold firecrackers to friends and earned cash with a lawn-mowing business.
After graduating from York University in Canada, Po returned to Hong Kong at 21 to find work. He started tutoring to make ends meet and quickly discovered that there was a great demand for his service.
He launched Capstone in 2003, making it one of the early players in a fiercely competitive college-admissions prepping market. Kaplan and Princeton Review, both based in the United States, have long been the preferred tutoring services when applying to an overseas university. But - and you can thank the craze for super-tutors for this fact - in recent years parents have been increasingly inclined to use a local firm, such as Capstone.
As any parent knows, Hongkongers are engaged in a kind of tutoring arms race. Each family is keen to give their children an educational edge so they have a crack at enrolment at a top university, which means they are all trying to outspend each other on their children's tutoring. This is ruinous for the household budget but great for the education service providers.
Hong Kong parents spend about 14 per cent of their monthly salary on their children's education, according to a survey by MasterCard. The city also has the highest number of families (52 per cent) who send their children overseas to study.
Getting into top universities in Britain and the United States - Hongkongers' preferred destinations for an overseas education - is challenging. The number of university applicants is rising, including from countries such as India, and mainland China.
Overseas students had a 12.2 per cent acceptance rate at Cambridge and 11 per cent at Oxford in 2011, according to statistics from Applications by School Cambridge and Applications by School Oxford. The Ivy Leagues in the US are no easier. This year, Columbia University accepted just 7 per cent of international student applicants, according to The New York Times' College Report.
Po began his individual tutoring out of Starbucks coffee shops and the Central Library, but in 2004 he hanged a shingle in Causeway Bay and hired a handful of young tutors. Nearly 10 years later, Capstone has a full-time staff of 30 with about 600 students.
Po says Capstone is not a cram school. He teaches critical thinking and analysis to Primary One students. Summer courses, for example, include competitive debate, journalism training, law, entrepreneurship and investment and academic writing and a head start in statistics and economics.
Stephen Worden, one of the young teachers at Capstone, teaches middle school-aged students in the academic writing and scholars programme.
The curriculum, which is modelled on Oxford and Cambridge (Worden has a master's degree in philosophy at Cambridge), includes politics, philosophy and economics for children. Worden references new events such as the fire in a Bangladesh factory this year to prompt discussion.
Capstone links skills such as public speaking and critical thinking to success in school admissions. Po calls it the "competitive advantage".
The company recruits recent graduates from Ivy League universities in the US or from Oxbridge. Po says that annually it receives as many as 300 applications for every 10 openings, and he occasionally gets job applications from former investment bankers (but that may be more a comment on the state of global investment banking than Capstone's merits).
Capstone is now looking to expand into mainland China and Singapore and, indeed, education is a great counter-cyclical business. As the economy toughens, demand for education goes up. On that perspective alone, Capstone's outlook is bright.
This story was updated at 12.15pm on July 22 to correct a misspelling of Mr. Ronald Po's name in the subheadling.