Cashing in on China's thirst for university training
Marcus Gee
Wednesday, June 11, 2008
A booming economy. A growing skills shortage. A culture that cherishes education. More than 250 million students in school.
China is a potential gold mine for overseas educators willing to help the Chinese train for the 21st century economy, but Canadian universities and colleges have been slow to mine it. “Canada has been very passive,” said education entrepreneur Toby Chu.
Nobody can accuse Mr. Chu of that. Stepping into the gap left by public universities, his CIBT Education Group is opening classrooms and training centres all over China, offering a Western-style schooling to the country's education-hungry masses.
It's one of the few success stories for Canada in the rush to profit from China's education mania, a race so far dominated by more aggressive players, such as the United States, Britain and Australia.
Vancouver-based CIBT has 3,500 students in China learning everything from business management to auto mechanics to how to work in a casino. Mr. Chu said enrolment is growing at 30 to 40 per cent a year. He is opening new sites at a rate of one every three weeks. And that, he believes, is just scratching the surface of the market. By 2020, he said 600 million Chinese will be middle class, with the money and the ambition to get an education with foreign-label cachet.
Universities and colleges around the world are starting to recognize that potential, stepping up their efforts to lure Chinese students to study abroad while offering degrees in China in association with Chinese institutions.
Canada has been trailing the pack. Its student-recruiting efforts are paltry compared with full-on national campaigns like Australia's. It presence on the ground in China is thin as well.
“Governments and public universities have been too busy fighting over budgets, so forget about overseas,” Mr. Chu said. Besides, there's no “big bonus cheque” for university administrators who establish a presence in China.
He and his family, on the other hand, own about $20-million in stock in CIBT, which had revenue of around $8-million last year. He drives a Mercedes-Benz and has a fat gold watch on his wrist.
“I suspect the academic types look down on what he's doing,” said Yuen Pau Woo, president of the Vancouver-based Asia Pacific Foundation, which highlighted CIBT's growth in a report last year.
“He's recognized that there is demand for Canadian education in China and that public universities are slow to fill that niche. It's pure entrepreneurship.”
With the hustle and commercial savvy shared by many Chinese immigrants, Mr. Chu started early in business. Now 46, he arrived in Canada as a six-year-old, the 19th child of a Chinese doctor with three wives who fled first to Hong Kong just before the Communist revolution then to Canada when Maoist forces were threatening British-ruled Hong Kong. His father is now 105.
Mr. Chu started work as a teenager loading trucks for the food company Salad King, but by age 19 was promoted to operations manger. Selling his car, a used red Porsche, for $3,000 he opened up a computer store on Vancouver's Victoria Drive.
On his first day in business for himself – Dec. 15, 1986 – he recalls standing in front of his store with a squeegee cleaning the windows.
There were no exalted motives behind his switch to education. He almost lost his shirt selling computers to China, then still a dodgy place to do business, so he decided to move to a new line where the customer pays up front. Students pay their tuition in advance.
Unlike foreign universities in China, Mr. Chu has not tried to partner with big Chinese universities in metropolises such as Beijing and Shanghai. Instead he focuses on so-called second-tier cities, such as Jinhua, Hangzhou and Wuhan.
Setting up shop in local colleges and universities, he said he is much like the Starbucks in a Chapters book store. His state-of-the-art, air-conditioned classrooms have the latest video-conferencing technology so that instructors in other locations can deliver lectures remotely.
The CIBT chief executive officer is aiming at the education mass market, catering to students who don't have the marks to get into one of China's elite universities or the money to take their whole degree abroad.
Students in vocational programs pay $2,000 to $3,000 (U.S.) a year, those studying for a master's in business administration $6,000. In a third program, students pay about $18,000 for a four-year bachelor degree, studying the first two years in China, the last two in an overseas university, usually in Britain.
CIBT is on track to double the number of its training sites to 50 by 2010 and Mr. Chu is eyeing expansion into South Korea, the Philippines and Malaysia. In December, he paid $12-million to acquire Sprott Shaw Community College, the oldest and largest private community college in Western Canada, with plans to offer many of the college's 140 vocational programs in China.
In time, he said he hopes to arrange with Canadian universities and colleges to bring some of his Chinese students to Canada, instead of Britain or Australia.
“Exporting programs and expertise to China and then importing students from China and Asia to Canada – it's a benefit to both sides of the world.”
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