The burgeoning demand for talent in the Artificial Intelligence (AI) space has led to a rapid spawning of training centres imparting programming classes across China.
The ever-increasing popularity of these centres can be gauged from a report in the Communist party mouthpiece People’s Daily that observes that in 2015 almost no one searched for “programming for kids” on search engine Baidu. In 2017, 1,200 users searched “programming for kids” every week. In 2018, already more than 3,100 netizens every week have searched for it, the publication noted.
Parents too seem to be convinced that their children ought to pick up the tricks of the trade. This has led to schools and training centers across China to include programming classes into their curricula.
The frenzy has not escaped investors’ attention. According to official figures, 23 companies that focus on teaching programming to kids were founded in China in 2017. The sector raised a total of USD 86 million in that same year, People’s Daily reports.
The confidence of investors has also been bolstered by the Chinese government’s emphasis on the gradual introduction of computing in classrooms across the country. In 2016, the government published a paper called “Implementing the Education Informatisation 2.0 Action Plan to Accelerate Educational Modernization.”
One year later, the State Council designed a “New-generation Artificial Intelligence Development Plan” that includes the introduction of concepts relevant to artificial intelligent in schools that includes programming.
Programming is already a part of the Gaokao exam (the National College Entrance Examination) in provinces such as Shandong, Zhejiang (home to Alibaba) and Beijing.
All this has led to the birth of several startups dedicated to teaching programming this year. All-dream (傲梦编程), Codemao (编程猫) or Pipa Coding (核桃编程) have received attention from investors and more players are pouring in. Most of them are from Beijing, Shanghai, Shenzhen, Chengdu and other first or second-tier cities.
Yuan Zhedong, All-dream’s CEO, explains, “In 2016, we gave up on an offline model. We only do individual lessons online.”
Yuan is very optimistic about the prospects of the industry.
“The sector is flourishing, every player has positioned differently and all have an advantage over the rest,” he explained to local media Jiemian.
While All-dream focuses on a meticulous individual teaching, Pipa Coding focuses on teaching programming through AI. Codemao wants to disrupt the industry of training centers through applications and tools exclusively for kids learning computing. Companies are taking different approaches in order to attract parents’ attention.
“Not all parents who enroll their kids in a programming course hope them to become a programmer,” Pan Gongbo, chairman of US-listed education company Tedu (达内教育集团) told People´s Daily.
“They hope programming can help their kids to develop an innovative thinking and a new way to solve problems,”Gongbo explained.
Li Yanyan, professor at Beijing Normal University explained why this skill is important: “We have entered the information age. The traditional way of solving problems is sometimes not suitable to current issues. Programming can lead kids to solve complex problems in a better way in a complex environment.”
According to data provided by Codemao, the company has signed cooperation agreements with approximately 3,000 schools across the country, trying to get into the B2B sector. Interestingly enough, not all these schools are in major cities. Some of them are located in remote provinces such as Inner Mongolia or Xinjiang.
According to Codemao’s CEO Li Tianchi, although parents in those areas might not be very familiar with coding, education officials there are very passionate about teaching programming.
“They want to make a difference in this field,” he says.
In this B2B approach, Codemao provides instructional and teachers’ training material, and curriculum for the schools according to each school’s needs.
According to data provider Jingdata, capital flow into the kids’ computing sector began in 2014, with a steady growth until the end of 2017. During the first half of 2018, 54 financing operations took place in the industry, raising a total amount of USD 201 million, more than the funds raised during the whole of 2017.
Codemao has already conducted its third investment round and has raised USD 72 million in total so far. Xiaoma (小码王) has completed two financing rounds. During the second round, the company received more than USD 18 million from investors.
Despite the promising scope ahead, the industry is still in its initial stages and faces several challenges.
According to Zeng Pengxuan, CEO of Pipa Coding, “Excellent content and methods can be replicated, but good teachers will always be scarce.”
With that philosophy as the bedrock of its operations his company plans to strengthen its educational human resources in the future.
They are not the only ones. Yuan Zhedong, All-dream’s CEO told a local media outlet, “We are preparing a second financing round to establish our own brand and expand our group of teachers.”
But the effort to hire the best teachers pits the startups against tech giants. Following the development of the Chinese Internet, programmers and coding professionals have endless employment possibilities, often rewarded with high salaries by the internet bahemoths.
Also, competition is intensifying in the sector. Companies have resorted to providing heavy discounts and promotions in order to attract parents. For example, Pipa Coding offers a first-month teaching for just CNY 100.
“During that month, parents will be able to tell if the kid likes this or not and they can decide if it is worth continuing,” explains Zeng Pengxuan.
As these startups brace for a fierce competition, they will have to invest heavily in branding and be prepared for a long fight if they want to make a breakthrough.