Tutoring business in Toronto forced to close due to COVID-19 pandemic

Founders of an English as a second language tutoring startup in Scarborough had to sell their business due to their inability to pivot online

Fiona Fu, founder of Aplus Education standing in the doorway of a showroom in Beijing, China, Sunday, March 30, 2021. Aplus Education offers English classes as a second language and helps with achieving academic goals.  Courtesy of Fiona Fu

None of the four founders of Aplus Education, a startup tutoring service for English as a second language learners (ESL) in Scarborough, expected that COVID-19 would mark a turning point for their business.

The past year has been devastating for small businesses in Ontario, especially for those who exhibit a heavy reliance on word-of-mouth marketing. Waves of lockdowns in Toronto led students to switch to remote learning, and Aplus Education was drastically impacted.

Ethan Wang and Fiona Fu, two university graduates who majored in statistics, foresaw the urgent need and business potential in teaching ESL students. Together with Eric Huang, the three founded Aplus Education two years ago and started their tutoring business on a small scale with five students. Not long after that, their flourishing business attracted their fourth founder and investor, Kai Ni.

“When we first started, the tutoring market at that time was informal, more like some kind of intermediary, with varying quality and without a formalized operation, so we thought it was a great opportunity,” Wang told the Toronto Observer via Zoom in Chinese. 

Being at the top of their classes and having been teaching assistants for several university courses had prepared Wang and Huang for tutoring. Along with their student resources from previous freelance tutoring, their business was off to a good start. But they needed something more competitive to distinguish themselves from other tutoring companies.

Setting themselves apart from the competition

What they found to be most effective in speeding up the expansion of their business was in-person promotion. The more students they reached out to, the greater chance they had to get them to sign up for their sessions. While their competitors were trying to win the favour of students by providing gifts, they adopted word-of-mouth marketing.

“Students follow the best tutors, which is what appeals to the students, not the brand, so finding good tutors is one of the challenges we’ve encountered,” Huang said at home in Toronto.

At the beginning of each term, they would invite students to take a free trial session that demonstrated their quality and method of teaching. Normally, 20 out of 200 students from their marketing reach would attend the trial session. Ten of them would eventually enroll in their services. It’s about 50 per cent conversion rate — relatively high among competitors, according to Wang.

They were newcomers to a business with many reputable and established players. They had to learn everything from scratch: marketing, recruiting, and balancing their school life with being tutors themselves.

The impact of the pandemic

Over the course of one year, they had gained credibility among ESL students. They moved from booking library rooms to renting a spacious classroom. The company’s team doubled to 10 tutors. When the business was operating at its peak, they had more than 400 students and their tutoring sessions had been booked more than 1,300 times.

Then the pandemic hit. Many international students who needed tutoring help couldn’t travel to Canada for their studies. According to Immigration, Refugees and Citizenship Canada (IRCC), there was nearly a 17 per cent decrease of international students holding study permits in Canada at the end of 2020 compared to 2019. 

The pitfall of their marketing strategy magnified the pandemic’s impact on Aplus Education, and the company experienced a sharp decline in newly admitted students.

Last month, the founders sold Aplus Education to Savvyuni. Savvyuni is a large tutoring company that had greater resources and experience in operating the business. 

“The reason why our business grew rapidly was because of in-person marketing,” Wang said. “There was a lack of experience in operating online, and the pandemic made it impossible for us to promote in person.”

Online tutoring market thriving

Despite Aplus Education’s experience, the tutoring market in Canada thrived as classes switched online. Tutoring services with an established student base can now deliver classes through recordings and cut costs while charging the same price as before.

Jasmine Jia, an international student from the University of Toronto who has been studying remotely from China, said she felt overwhelmed by the course load and her need for tutoring services is more than ever. 

Jia said many of her courses have been cancelling exams after switching to online, so the proportion and weight of assignments increased. Combined with the less effective online learning, she experienced a greater need for tutoring services. Jia has been using tutoring services since the pandemic and she said it’s been beneficial for her study.

“It’s unfortunate that we were so heavily impacted by the pandemic and were forced to close at this time when the tutoring business is moving so well. However, we all learned a lot through this experience and we’re grateful for the students who placed their trust in us,” Wang said.

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Posted: Jun 9 2021 9:00 am
Filed under: Shift to Online Spotlight On Small Biz