The policy periodicity of education industry is obvious, and the differentiation of primary market investment is intensified
Policy cycle. The education industry policies has obvious periodicity. The update of education-related regulations and policies has shown an irregular pendulum around people's livelihood. In the past 10 years, policy supervision has become stricter and the education market has become more standardized. The aim of the policies is to ensure that education to conform to the "inclusion" and "fairness" attributes of people's livelihood, but education is the main way to enhance the country's human resource competitiveness and has a selection purpose. Therefore, competition for higher education based on talent selection will inevitably occur at a certain stage of education.
The investment direction of capital in the industry cycle is even more polarized. The scene of teaching and learning is shifting from inside the school to outside the school. The new traffic platform is accelerating the change of the traditional role of teaching and learning. The potential consumer groups of different tracks have very different demands for education products. Meeting the increasingly stratified learning needs is a social problem, and disorderly supply of education resources will lead to chaos in the education industry. The top-down supervision and the bottom-up industrialization of education inevitably produce friction.
Capital cycle. Education, as one of the most popular industries in recent years, has indeed attracted a wave of capital's attention. However, it is difficult to "build a positive result" for capital-maturing projects, and most of the large investment is to "pay tuition" to the industry. Hot money has a time cost, and the source of leveraged funds is affected by national financial policy regulation. In recent years, investment has shrunk significantly.
The amount of investment and financing in the primary market of the education industry hit a five-year low under the superposition of the three cycles and the catalysis of the epidemic, and the direction of capital investment is even more polarized. On the one hand, a large amount of funds are gathered in leading companies, and more than 90% of the funds are invested in leading companies on the track. As leading companies obtain more capital blessings, small and medium-sized enterprises will face a more intense competitive environment, and it will be more difficult for them to stand out. On the other hand, the number of investment and financing in the early stage accounted for nearly 70% of the total number of investment and financing. Although the number of early investment and financing in the education industry is relatively large, the total number is only 100+, which is only a drop in the bucket compared to hundreds of thousands of education and training institutions.
The dual role of epidemic situation and policy is conducive to online education, higher vocational education and education informatization
K12 and Quality Education Policy: The Ministry of Education issued a notice requesting the postponement of the start of school in the spring of 2020, and issued a call for "no suspension of classes", and elementary and middle school students will start online classes. The epidemic has led to changes in education consumption habits, consumers are more likely to accept online teaching, and the conversion rate and renewal rate of online education will be higher. From the perspective of consumer awareness and brand, it is a great benefit to the online education industry. In the first half of the year, the policy focus was on the epidemic, and in the second half of the year, the trend of maintaining strong supervision, emphasizing standards, and encouraging orderly at the same time was basically continued to promote the safe and stable development of education.
Higher education and vocational education policy: The sudden epidemic has made the employment situation not optimistic. Employment is the primary and fundamental of the "six stabilities" and "six guarantees". "Stabilizing employment" is the overall situation, and "guaranteeing employment" is the bottom line. Consolidate the integration of production and education in vocational education, strengthen the school-enterprise cooperation model of running schools, deepen the structural reform of the supply side of vocational education, promote the deep integration of information technology and education and teaching, and constantly deepen the policies of higher education and vocational education.
International education policy: The emergence of the epidemic has had a long-term and uncertain impact on global politics and economy, which is reflected in many issues such as the safety of international students and the legality of visas on the international education track. Many countries have successively introduced relevant policies for the entry and exit of foreign students, and online courses have become an inevitable choice for a period of time. At the same time, there are new trends in immigration and visas. The current mainstream opinion in the industry believes that it may take 3-5 years for the epidemic to cease completely. However, international education has a long time span and a long behavioral cycle, and the overall study abroad market will become colder in the next few years.
Education informatization policy: The epidemic has exposed problems of teachers and student groups that are not proficient in the application of online educational technology. These problems have further strengthened the country's investment in the field of vocational education and education informatization, as well as the introduction of related favorable policies. At present, there are still problems of weak interaction and low retention rate in education informatization into schools, and this pain point has not yet been substantively resolved.