Why The Business Of Private Education In China Was Never Going To Work

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China’s listed private education companies keep getting hit with bad news. The latest blow came from a leaked government memo expressing the intention to make private education companies non-profit. Before that, it was fraud troubling the trade.

The companies have sucked up a lot of U.S. capital, and they’re not needed anymore. New Oriental

EDU
(EDU) listed in 2006 and has raised around $2.5 billion. TAL Education

TAL
(TAL) has pulled in about $5 billion since its 2010 IPO. The notorious Gaotu Techedu (GOTU) has garnered more than $6 billion. There’s Puxin (NEW), OneSmart (ONE), RYB Education (RYB), and many more. It takes about five minutes of reviewing their statements to suspect that fraud permeates the accounts of each one of these companies.

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