The world’s first listed education and education technology SPAC (Special Purpose Acquisition Company) EdtechX Holdings has announced a unique agreement with Meten Education’s (China) digital platform Likeshuo.
Based in Shenzhen, Likeshuo teaches Chinese to children aged 5-17, as well as adult learners. The platform requires native-speaking teachers to commit to 20 hours of instruction per week.
According to research by Citibank, the ELT market in China is expected to grow to US$43 billion in 2022, representing a 21% CAGR, mainly driven by growing expenditure on education, urbanisation, increasing awareness of the importance of English, and technology development.
The new US$535m deal will see the launch of Meten EdtechX, which will be listed on Nasdaq and will focus on providing English and future skills training for a growing market of students and young professionals.
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The companies plan to raise up to US$100m to fund ambitious growth plans, including market consolidation in China and the roll out of Meten’s existing omnichannel distribution platform, combining digital delivery and strategic retail presence, across a market of more than 600 cities in China.
The rapid pace of urbanisation in China has driven demand for education, vocational training and edtech services, according to research by Morgan Stanley. By 2030, online tutoring could be used by over 30% of Chinese in education – a 20% growth from today, representing a market worth US$150b.
“The growing urban Chinese middle class’ aspirations for their own careers and their children’s academic success is unleashing large consumer spend and investment opportunities for the education and lifelong learning markets in China,” EdtechX co-founders Benjamin Vedrenne-Cloquet and Charles McIntyre said in a joint statement.
“Education in China has become the ultimate consumer good. Demand for tutoring, English language training, job-oriented upskilling, is growing at double digit rate. Meten EdtechX will operate at the heart of this with a market leading position in the ELT segment and a profitable omnichannel business model combining strategic retail presence, technology and digital delivery”.