How Many Times Do You Need To Use Up The Alphabet? Capital Fantasy Drifting Of Hundreds Of Billions Of Valuable Ape Tutoring

Why is ape counseling crazy financing? Industry insiders told reporters that ape counseling cash flow is not tense.

"Some people joke about whether we can use the whole alphabet." In March this year, after the online education organization ape guidance completed the G round of $1 billion financing, Li Yong, founder and CEO of ape counseling, wrote in an internal letter.

Just seven months later, ape counseling officially announced on October 22 that it had completed two rounds of financing totalling $2.2 billion. This time, ape mentoring did not choose the "H" and "I" of the alphabet, which might create the "alphabet" of global start-up financing, but was crowned with G1 and G2 rounds.

Why is ape counseling crazy financing? Despite the huge investment in the marketing war, ape counseling advertisements can be seen everywhere in TV variety shows, short video app, elevators and bus stop signs, but insiders tell reporters that ape counseling cash flow is not tight.

Along with the financing amount, the official announcement also included ape tutor's valuation of US $15.5 billion, or more than RMB 100 billion, which makes it the number one educational technology Unicorn company in the world.

Since APE + announced that it would pay more attention to its own round of financing in July 2014, in addition to its own round of financing of $40 million. At the end of August this year, after it was revealed by the media that it had completed the G1 round of financing of $1.2 billion, ape guidance said it would not comment on it, but refused to admit it. However, it quoted the reported value of $13 billion on its official recruitment website.

"The goal of ape coaching is to become a company with a market value of 100 billion US dollars, which is to comprehensively surpass tal and New Oriental." The industry told the 21st century economic report.

Therefore, in the rare public interviews in recent years, "scale" and "development" have become the key words mentioned by the founders of low-key ape counseling, and ape counseling is eager to show its rising valuation to the outside world. But how much bubble does online education exist on the tuyere? And can ape tutoring stand out in homogeneous products?

Capital shapes ape coaching

For ape counseling huge, high-frequency financing is not because of lack of money, there are different voices in the market.

According to late latepost, one investor involved said, "even if the company has no need to take money, it still needs to take it, otherwise it is sending money to its rivals."

However, according to AI finance and economics news agency, the G1 round of ape counseling financing has been going on for two months from the news to the official announcement. Zhao Wei, the founding partner of Murphy capital, believes that the reason for the seesaw may be that some investors want to wait and see again and complete the delivery of financing after fully understanding the market. It may also be that the investors believe that the market environment has changed and their confidence in the sustainability of online education has been shaken, and it is necessary to supplement market due diligence.

Some people in the online education industry told the reporter of the 21st century economic report that "the cash flow of ape counseling is not tense. Education is a prepaid industry, and there will be a huge amount of deferred income. As long as continuous enrollment and smooth delivery are ensured, and no large amount of refund is generated, good cash flow can be realized."

Capital has deeply shaped the entrepreneurial process of ape counseling. In 2012, the first product made by Li Yong and other four founders after leaving Netease is not the current public examination business, but a "micro blog community" perpendicular to teachers and learners, covering almost all education fields. In February 2013, the ape question bank was launched, which was also a tool product for the public examination, and then it started from the college entrance examination. Until July 2014, it focused on the K12 field.

In May 2015, the teaching product ape guidance was launched. It was initially a C2C platform product. This is an online education mode with no successful cases. The reason is very simple. It is difficult for thousands of teachers on the platform to achieve quality standardization, which is a big taboo in teaching products with strong delivery.

In 2016, Tencent decided to change its main body of online counseling from $4000 to "C" in 2016.

At that time, ape guidance was not the first organization to do live online large class classes, but the market was still in its infancy. At that time, the number of students in XRS online school was less than 10000, gaotu class was still hatching, and homework help live class was not online.

In 2017, Tencent received $0.5 billion in financing, and its valuation rose to $1.0 billion. Li Yong's two public interviews are intriguing. He first said that this round of financing was completely out of plan. "We have plenty of cash reserves, so we didn't need financing. Warburg Pincus is very interested in education. It is they who convinced us to do a new round of financing. "

At the same time, Li Yong also said, "scale is definitely more valuable to us."

Until 2019, the growth in ape coaching was not radical. "In fact, we haven't had a large launch before this year." Ape mentoring insiders told 21st century economic report.

In 2018, ape coaching also claims to be a slow company, even though it has paid 1.5 million users. Li Yong told the media at that time, "from the cost point of view, our products are not suitable for strong sales of this kind of thinking."

Just one year later, in the summer vacation of 2019, the online live broadcast of large class racetrack broke out completely. The annual revenue of the head office exceeded 2 billion yuan. With whom did you learn to go public and make profits, XRS online school took the lead in marketing war in order to block other head organizations. At this time, the capital found that only ape tutoring and homework help were left in the large class head institutions that had not yet been listed, so the financing changed from drip irrigation to flood irrigation.

Win by burning money?

In 2020, ape guidance has led to the crazy "burning money" marketing of online live broadcast large class class institutions.

According to AI financial news agency, in the whole year of 2019, ape counseling will spend 1.49 billion yuan on marketing, while in 2020, the money will not be enough for three months.

In the byte system launch list, only ape tutor has a monthly consumption of more than 500 million. It is also reported that in June this year, ape tutor spent 36.66 million yuan on advertising in byte hopping channels.

Ape guidance in Tencent advertising and the amount of headlines "roughly the same.". This does not include offline investment. It is reported that ape counseling spends 300-400 million yuan on Focus Media every quarter.

"The online battle has been thrown into chaos." A person in the education investment industry told the 21st century economic report that "in the past, online education had obvious rules, concentrated in the second and fourth quarters, which was for large-scale enrollment of new students in winter and summer vacation. But now, brand advertising continues in four seasons, and nine yuan promotion courses are sold all year round."

According to the report of "late 2020", a large amount of money will be put in by poste, because the actual amount of money invested by poste in 2020 will be even higher.

Chen Xiangdong, the founder of who school, said on the Q2 financial report telephone conference that "some investors predict that the financial losses of companies that are more aggressive in increasing enrollment and cash income will reach more than 7 billion yuan in 2020."

"But the capital has been heavily invested, so the capital chain of ape counseling will not be broken. Even if there is no financing, the current volume of ape counseling can be quickly listed for financing." The education industry said.

It's very much like vipkid, another online education institution once sought after by capital. The one-on-one education institution, which focuses on North American foreign teachers, has raised more than 1 billion US dollars in six years, and started a marketing war at the cost of annual loss of 2.2 billion yuan, and finally obtained the market share of this track. In 2019, vipkid's "burning money" investment stopped abruptly, and began to improve its operation efficiency, realizing that UE (unit operating profit) was positive.

"If ape wants to become a company with a value of 100 billion dollars, it must attack the market share and surpass XRS online school through a large amount of investment, so it is still in the stage of strategic loss." These people told the 21st century economic report.

Although ape coaching achieved extraordinary growth, it did not leave other head mechanisms behind. At present, there are 3.7 million people reading ape counseling, including 1.5 million zebra AI classes, that is, 2.2 million students in large classes of ape guidance. Tal just released its financial report up to August 2020, which shows that there are 2.928 million students in the regular price course of XRS. Com, and continues to maintain the "No.1" position of the track.

In terms of revenue, at the beginning of the year, ape tutoring set a revenue target of nearly 10 billion yuan, of which K12 business (large class + zebra AI class) completed 8 billion yuan, and chalk public examination completed 1.23 billion yuan. According to who learned from the financial report, we achieved 2.94 billion yuan of business revenue in the first two quarters. The revenue of XRS online school from March to August also has $515 million, and the gap between us is not obvious.

Online live broadcast of the big class race track not only did not win or lose, and even in the short term did not see who would fall behind.

The next "burning money" marketing battlefield

Ape tutoring, like homework help, started with the tool app of question bank and photo search, and extended to online tutoring, but the strategic significance of tool app for each is quite different.

Ape tutoring and homework help are the "dead enemies" of the tool products of search question bank. Ape tutoring once boasted that "everyone uses little ape to search questions", while homework group claimed to be "the largest online education platform in China".

The difference is that homework app gathers a large number of users through free tools, contributing low-cost traffic for homework live classes.

"Self owned traffic is the core source of the growth of students who pay for the live broadcast class. In 2020, more than 67% of the new students will come from their own flow. The integrated cost of acquiring customers is less than half of the industry's average The operation group told the 21st century economic report.

Ape tutoring insiders told reporters, "the ape question bank and the little ape search question have no obvious contribution to the acquisition of ape counseling, and their contribution mainly lies in the massive academic data that can help better Polish teaching products."

In other words, the new comers of ape counseling are heavily dependent on the purchase of external traffic.

But ape coaching's zebra AI class creates and leads a new K12 online education track. Zebra AI course is a low-cost recording and broadcasting course. It can realize the interaction between students and courses through AI technology, and it is aimed at young people aged 2-8 years.

This has strategic significance for ape counseling. First of all, ape counseling started from senior high school curriculum counseling. At present, the penetration rate of senior high school students is high no matter whether they are expanding courses or renewing fees. An ape tutor told 21st century business reporter that he had studied nine subjects in ape counseling and received more than 200 teachers' services. The ape tutor can cover nearly 100000 students every year.

Therefore, in order to realize the rapid development of ape counseling, it is necessary to sink into the younger groups, and "engage in close combat" with XRS online school, which is growing up from a small school. Zebra AI class is a product of "intercepting" primary and pre-school students.

"Ai class is a light delivery product and does not rely on teachers very much. Therefore, it is a flow type product, which can obtain customers quickly and on a large scale." "Although the cost of AI courses is low, the business model is relatively fragile. Because of the low willingness of students to renew their fees, young students will no longer be satisfied after one or two years of experience. At this time, we need famous teachers to undertake the flow and demand of live products."

It is in this sense that ape guidance does not use the massive users of tool app to guide the live large class products, but its strategic value is actually realized by zebra AI class.

According to the current report, the number of zebra class students has reached 5.5 million yuan per month. Ape counseling has launched a product called spot pony early education, which provides bilingual early education solutions for 0-3 years old.

However, the field has also been rapidly homogenized. Similar products such as tal's monkey, byte skipping melon and melon dragon, Tencent's happy mouse, and Xiaozao enlightenment from whom to learn have been launched one after another, which may become the next crazy "burning money" marketing battlefield.

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