51Talk, an oral English training service providing one-to-one courses, announced that it has received US$55 million of Series C financing led by Sequoia Capital along with DCM and the Shunwei Fund headed by Xiaomi founder Lei Jun.

It is worth nothing that 51Talk is the first online education company in which Sequoia Capital invested. Sequoia is the backer of a number of highly successful Chinese internet companies, like Alibaba, Qihoo 360, VipShop, JD, Dianping, and so on.

51Talk closed a US$12 million Series B round last year and received several million dollars in Series A from DCM at the end of 2012. The angel investment is secured in 2011 from ZhenFund which was founded by legendary angel investor Xu Xiaoping.

51Talk offers e-learning courses at affordable prices, with teachers mainly coming from southeast Asian countries who speaks English as their native language. The company currently claims more than 2,500 foreign teachers, up from 1,000 at the end of last year, and more than 50,000 paying students.

The funds will be used in upgrading the technical platform and IT systems, as well as improving syllabus design. The site is planning to expand into the overseas market and kids’ education, according to Huang Jiajia, CEO of the company.

51talk is also trying to diversify its user experience by setting up offline experience centers, following a similar initiative by major competitor Hujiang. In addition to building such centers in first-tier cities like Beijing and Shanghai, 51Talk is also planning to expand their offline network into second- and third-tier cities, since more than half of their users come from them, Huang added.

image credit: 51Talk

Emma Lee

Emma Lee is Shanghai-based tech writer, covering startups and tech happenings in China and Asia in general. We are looking for stories related to tech and China. Reach her at lixin@technode.com.

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2 Comments

  1. This company has been around for a while now and yet they don’t have any business ethics. At this day and age, it’s hard to imagine that such company exists. 51talk is a very unprofessional company.

    This company hires all their teachers in the Philippines. Most of the teachers have no formal teaching experiences at all but has a good command of the english language hence the cheap lesson prices. Additionaly, they don’t treat teachers as their employees as stated in the Service Agreement instead they are just treated as Independent Service Provider so they won’t have to pay for government mandated benefits. Perhaps this is also the reason why they don’t treat teachers well and fairly.

    Prior to joining this company, I have read a lot of negative comments online about this company. But I ignored it, thinking that they were just written by disgruntled teachers. However, I now share the same sentiments as them.

    This company likes to make extra money from the teacher’s hard earned money. You see, we only get P50(RMB 6.16) to P66(RMB 9.15) PER CLASS/STUDENT. But they imposed steep penalties of P300(RMB 41.59) per CLASS/STUDENT for missed lessons.

    A missed lesson happens when there’s a sudden power outage, lost of internet connection, sickness or some emergencies. None of these can be avoided at all and since all these situations happens suddenly we are deducted P300 right away and in REAL TIME. They said they will waived the penalties once a teacher presented a proof. Unfortunately, a lot of times they don’t waive it and if ever they do they don’t give the money back. It will take them ages for them to do it if they ever do but they will still keep a part of it for themselves.

    Aside from the penalty, another unethical money making scheme for them is pocketing the reimbursements of the teachers. For instance, they used to give away tarpaulins with the 51talk logo printed on it to serve as the background while teaching. Now, they required us to have it printed by ourselves which they promised to reimburse us P100 for it. Imagine, a 3 feet by 3 feet tarpaulin and they’re just going to subsidize P100. Anyway, after we got it printed they no longer honor the reimbursement. Instead they will just give us excuses and alibis until they will cimpletely ignore you. If you pester them some more they will begin to pressure you and intentionally delay your fees/salary as what happened to some colleagues.

    Another example, they required us to submit notarized special power of attorney and again, promising us that P100 will be subsidized. Until now, we have yet to receive a single cent.

    The company, especially the local support/admin team doesn’t care about the teachers. Whenever there are concerns about the students they will be quick to respond but if the matter is about the teachers then they will just ignore you especially if it’s about money. The local support/admin will always address the admins in China with various racist remarks to make it sound like they are on our side but they are actually not. They used to tell us that they can defend us from a student’s complaint if we have a screenshot or speedtest but in the end they will still side with the students even when it’s clearly the student’s fault.

    Even the trainings they provide the teachers are a joke. Teachers are required to undergo trainings to get promoted. Unfortunately, after you finished a training you will never get promoted unless you have a good rating/score from your students. They will suggest that you ask your regular students to give you a rating. This is another obstacle they put up. I guess they don’t like teachers to be promoted to save some money.

    Normally, a company would want to have long term personnel nstead of going through the trouble of hiring new ones. But 51talk is different because they rather hire regulary instead of treating teachers fairly. Perhaps they do that because they prefer new teachers. They only need to pay new teachers P50 so it will save them a lot of money.

    Sometimes they desperately needed teachers so they will give sign up bonus and referral incentives which are, unfortunately, misleading. The sign up bonus and referral incentives are given in 2-3 separate occasions and each occasion requires a teacher to complete a certain task before it is given. Not surprisingly, it is always delayed.

    If this company is fair and ethical they would not make money from the teachers and they would’ve made a system to facilitate the waiving of penalties faster (as fast as they deducted it – REAL TIME), they won’t make broken promises about reimbursements and will treat teachers fairly.

    Just because we are just independent service providers doesn’t mean we should be treated indifferently. They keep changing rules to protect themselves instead of it being fair to everyone.

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