The basic tone of the preschool education policy is focused on improving the allocation and strengthening supervision, showing a tightening trend.

Furthermore, after the outbreak, offline kindergartens were completely shut down, and offline early childhood education institutions also suspended classes. This suspension lasted half a year. During the period, although the situation of the epidemic slowed down for a while, early childhood education involved the youngest students and the strictest policy supervision requirements. As a result, kindergartens and early childhood education institutions did not open classes.

The opening and resuming time of school is uncertain, which has a huge impact on private kindergartens and early childhood education institutions.

Among them, private kindergartens are mostly inclusive kindergartens, which are small in scale, rely on lease to run the kindergartens, insufficient funds for running schools, and unstable teachers. Tuition fees are the main source of income. In addition, the local support for inclusive private kindergartens is small and random, resulting in the benefits of inclusive preschool education services provided by private kindergartens in some areas even lower than the cost.

Under the epidemic, although private kindergartens that are included in the inclusive nature enjoy certain government subsidies, they have no income unless they start school. If there is no income, they have to pay rent and pay teachers according to the minimum wage standard. The operating pressure has increased sharply. According to relevant data from CCTV Financial Report, kindergartens that have sustained support for more than 6 months after the outbreak are less than 1% of the total number of kindergartens surveyed, and kindergartens that cannot support normal operation account for 68%.

In order to survive, private kindergartens may actively seek merger and acquisition opportunities, or fancy self-rescue, “change jobs” to sell barbecue, breakfast, and buns.

The acquisition of the former depends on luck. Perhaps some local bosses are taking advantage of the low prices of kindergartens to seek industrial layout, but this is not a long-term solution. The latter’s “change of career” relies on perseverance, and the income earned is undoubtedly “a drop in the bucket” for the operating costs of kindergartens.

For early childhood education institutions, facing offline shutdowns, for self-help, actively or passively embrace online. Previously, early and preschool education institutions that focused on offline began to add more online courses, and at the same time tested short videos to win customers and live broadcast goods. Selling lessons online and bringing goods can increase cash flow and revenue, and it may help institutions tide over difficulties. However, pre-school education is unable to complete all deliveries online due to its strong accompanying attributes, and it is difficult for online to replace offline. At this time, the transition line is only a short transition for most early childhood education institutions that previously focused on offline.

For the early and early childhood education institutions that used to provide online services, they were less affected by the epidemic and even enjoyed certain dividends.

In February 2020, Uncle Kai Tell Story received US$66 million in financing, which is expected. In April 2020, Kabi Early Education received tens of millions of angel rounds of financing, but it was a bit unexpected. During the epidemic, the angel round financing of educational institutions was generally not smooth. The reason why Kabi Early Education has won the favor of capital is that it is not the mainstream form of offline brand franchise or online recording and broadcasting of courses, but the form of live broadcast of 1 to 6 small classes. But in the future, will the market size of online early education be able to stand shoulder to shoulder or even surpass offline early education? It has yet to be verified by the market.>At the same time, the field of education MCN has sprung up. Excluding the original MCN institutions that have increased the education field, some educational institutions simply transformed from offline to MCN, and many of them have achieved good results, even hundreds of millions of fans. Even educational institutions with ample funds and ability to incubate MCN as investment. Short video / live broadcast + education is booming, so that some Kuaishou education content service providers believe that in the future, education companies will become half of MCN institutions.

Looking at it calmly, the short video accounts of most educational institutions are still in the initial stage, and there is no data to determine whether the closed loop of short video + education commercialization can run through. The biggest change that short videos have brought to the education industry is now only a change in the form of delivery. Follow-up development remains to be seen.

Conclusion

Looking back at the education industry in 2020, internal and external troubles, market reshuffle, and industry differentiation are truly cruel.

But from another perspective, opportunities and crises coexist. The current coldness of the education capital market, from a longer-term perspective, is conducive to the healthy development of the industry. Those who play for money, have no competitive barriers, and use 2VC as their main business model will be eliminated naturally by the market, while institutions that settle down to do content and brand will stand firm with the help of capital, technology and talents , Get stronger.

In the year of the black swan, money goes to the head, and even more to the “good” place. In the process of industry differentiation and big waves, every educational institution that wants to become bigger, better, and more money needs to prove itself “worth it.”

How to self-certify? It is nothing more than the three elements of supply: high-quality, stable, continuous and low-cost teacher supply, continuous iterative content supply, and low-cost, standardized service supply for different delivery scenarios.

All this and “money” are mutually cause and effect and complement each other.