Parents’ willingness to pay and investors’ enthusiasm are not enough to ensure a profitable future for edtechs that still lack a viable business model

In China, spending on education accounts for more than  25% of household expenditures (in urban households, the percentage can be as high as 42.2%), compared with 2.3% in the US. It comes as no surprise, then, that the edtech sector is popular among Chinese investors.
Over 50% of global investment in edtech flowed into Chinese startups in 2018. In June of that year, English tutoring app VIPKID raised US$500m in its Series D+ funding, the single largest venture round ever for an edtech startup. During the first three months of 2019, Chinese edtechs secured 131 investment deals, raising...

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