Tech start-ups focus on Hong Kong’s thriving education sector

A clutch of tutorial portals and a student accommodation site are cashing in

PUBLISHED : Friday, 03 June, 2016, 2:41pm
UPDATED : Friday, 03 June, 2016, 2:54pm

Education is a lucrative business in Hong Kong. As long as parents are happy to shell out large sums to enrol their children in tutorials or interest classes, and our school system continues to be exam-oriented, there is money to be made. And most of it is being made online.

A clutch of home-grown education startups has cropped up in recent years. Snapask, for instance, is an app that helps students with their homework. Set up by finance graduate Timothy Yu (who raised more than HK$10 million for this venture last year), the “tutor in your pocket” claims it could answer any academic questions within one to two minutes. For a monthly fee of HK$300, the 20,000 users can access its pool of 1,000 university tutors.

Similarly, Alastair Altham and his business partner Richard Howorth founded Tute.hk, an online tutorial service, last month. It allows parents to browse tutors’ profiles and book classes for their children over a computer. During a lesson students and tutors can communicate via a webcam and all the teaching is done online.

“We record all our lessons. If students want to have another go to better understand [some topics], they can play the lesson again. Parents can also listen to the lesson again to see whether their children are responding to tutors in the right way,” says Altham.

“It’s a safeguarded environment. Parents can send messages to tutors to request what they would like their children to cover.”

Tute.hk has 750 tutors who are graduates and postgraduates from top British universities such as Imperial College, Oxford and Cambridge. The tutors were vetted and interviewed by their team in the UK.

Other than one-on-one 55-minute sessions (which cost HK$600 each), the online learning platform also offers more general group classes for up to six students that cost HK$400 per session.

“As an employer, I do not just look for academic results, but also wider perspectives on the world. Graduates should be rounded individuals,” says Altham.

“Tutors get to teach something they love. It can be anything from impressionist art to poetry to the European Union and black holes. Parents can look at the large menu [of wider-learning lessons for their children to do] on holidays, weekends or downtime to broaden their horizons.”

Altham says they are now looking to expand into the mainland and the region.

“The commercial market for education is enormous globally. It can harness the power of new media and the internet. We see all online courses offered by universities around the world now. We have looked at the tutoring market in Hong Kong and Asia. It’s mostly conducted in the traditional physical contact form. If it goes online, it will open an enormous new pool of talent,” he says.

Not to be outdone by these tech hotshots, traditional tutorial centres have also gone digital. Last year, the 11-year-old Kernel Education Centre in Kwai Chung developed a HK$2 million mobile app platform called Handlebook that lets students answer questions via mobiles in classes and parents to check on their children’s tutorial progress.

However, there is one area in education that has thus far been overlooked by startups though it has little to do with learning: student accommodation.

Shakil Khan – an investor and personal adviser to founder of music-streaming giant Spotify Daniel Ek – joined Student.com two years ago to help international students find places to stay when they are abroad. He sees there is a big potential of growth for this kind of business.

“Hotel-booking has gone online, so has music. But nobody has built a global platform to help students find housing,” he says.

“If a student from Hong Kong has to study in Manchester, [his parents] can’t just phone up and visit the place as it’s very expensive to do so. To try to book student housing, you have to phone a friend [in Manchester] and tell him your child from Hong Kong is going to study there and ask the friend if he knows anywhere that he could live. Every student around the world has the same problem. There’s a huge industry there.”

Founded in 2011 by the UK-born and Shanghai-based Luke Nolan, Student.com booked US$110 million worth of stays last year. One of its investors is Hugo Barra, the global vice-president for Chinese smartphone maker Xiaomi, who was from Brazil and studied abroad in Boston in the US.

While the company does not reveal the number of their landlord and student members, Student.com covers 426 cities and more than 1,000 universities. They have more than 200 employees working in offices around the globe, including Hong Kong, London and Shanghai.

“Our landlord partners are all purpose-built hostel housing with shared kitchen and communal area built by private developers. So they are similar to campus [dormitories],” says Khan.

“For landlords, they cannot translate their websites to all languages [even though] the students come from all over the world. Our team [has] 28 nationalities. We have offices all around the world. We have teams visiting the properties and send photographers to take pictures of the housing ourselves.

“Safety is the number one concern for parents. So we do the vetting process ourselves.”

Although Student.com doesn’t feature accommodation in Hong Kong – students who cannot get a place on campus here tend to rent from private landlords – Khan says Asia is their next target market.

“We went to Japan early this year, which is our first country in Asia. As the number of Japanese students is falling, so they encourage international students to go to Japan.

“It’s not just Asian students who go to Western universities, students from California or New York want to study in Asia, too,” says Khan.

Having invested in various businesses including Spotify, Student.com is Khan’s first foray into education. Although it’s a niche market compared to music streaming, he says it’s a huge one.

“In London, 25 per cent of all students are international students,” he says of the potential of his business.