By Lex Baker
There is a point in our list of business partner requirements that catches many entrepreneurs off guard. When business leaders speak to us about developing the Wall Street English brand in a given market, the last thing they expect is for us not to value teaching experience.
After all, Wall Street English is one of the top adult English language training names worldwide, with more than 400 centers across 27 countries. Surely you can’t lead the market expansion of a brand like this without some prior experience in the educational sector?
No, we answer. We’re looking for business partners with market knowledge and a thirst for growth. Partners who are interested in building a profitable business based on a global brand. Who value the availability of back-office support to build sales.
If that sounds a bit like the description of an IT channel partner, then it’s no coincidence. For the last 45 years, Wall Street English has been building one of the most successful English language training business models in the sector. And it looks uncannily like an IT company.
Take our product, English courses. Some companies in our sector push handbooks and learning guides, a ‘hardware’-based approach. Others focus on software: learning programs and apps, for example. Still others opt for face-to-face teaching, a service-based model.
We’ve found that the optimum experience demands a mix of all three, similar to the way IT companies began packaging hardware, software and services into fully rounded ‘solutions’ from the 1980s onwards.
Within this approach, we place a significant emphasis on innovation. Our unique teaching methodology has been tweaked and refined over the years, building on the experience of more than 1.5 million customers.
Innovation isn’t just built into our teaching methodology, but also into our entire business model.
We have created a ‘business in a box’ which our in-country commercial partners can roll out and scale up rapidly, essentially emulating today’s software-as-a-service trend but applied to a learning environment.
That is why we don’t ask for educational experience when we talk to potential in-country partners. Our courses are our proprietary intellectual property, and we don’t need people to replicate it. Instead, we want people who can help us deliver it to new markets.
We are not the first to apply this very Silicon Valley-like business model to an industry outside of IT, of course.
Increasingly, other companies are disrupting their markets with similar approaches: take Tesla in the automotive sector, for instance, or Uber in transportation. However, such models have been slow to arrive in education. On reflection, this is surprising.
A tech-styled approach to language teaching yields considerable benefits for learners and for the companies providing the training.
Learners get a curriculum that is continuously updated to incorporate the latest best practice, and makes best use of new technologies to maximize results.
Companies, meanwhile, are able to make good margins on competitively priced, high-quality teaching, because they do not have to invest in developing and building the business from scratch. Our model offers a 35% annual return on investment.
The value of our approach is reflected in the value of our business: in November 2017, Pearson sold Wall Street English for $300 million to a consortium consisting of funds affiliated with Baring Private Equity Asia and CITIC Capital.
Both companies have an eye for what constitutes a successful business. Baring Private Equity Asia had sales of approximately $35 billion in 2016, while CITIC Capital manages over $22 billion of capital across 100 funds and investment products.
In acquiring Wall Street English, they are not looking to make changes to our business. Quite the opposite. Like us, they can see our model works and are simply aiming to help us scale it further.