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VIPKid downsizes group class platform Dami Wangxiao

Written by Song Jingli Published on     2 mins read

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Only math classes running until June are still available on Dami’s platform.

Chinese online education unicorn VIPKid has halted financial and human resources support for its Dami Wangxiao (Dami Online School) platform, Chinese media outlet Yicai reported on Wednesday.

Zhang Yuejia, who led Dami Wangxiao, has returned to VIPKid to lead a sales team, while instructors and operational staff have either been absorbed into the parent company or resigned.

Only online math classes running until June are still available on Dami. Other companies in the online education sector are already recruiting students for summer courses and the next academic year. For example, Yuanfudao, a major player in the sector, is placing students in courses that run until January 2, 2022.

“Since 2021, VIPKid has optimized and updated its business, including Dami Wangxiao, to focus on its core English teaching. The update is aimed at improving the learning experience and will not impact Dami Wangxiao users,” VIPKid confirmed with tech blog AI Caijingshe on Thursday.

VIPKid merged its large-group class platform Fengxiao and small-group class product SayABC in January 2020, renaming the combined business Dami Wangxiao. The new entity raised USD 80 million from investors, including Tencent and Sequoia Capital China, in its Series A round.

However, that sum of money pales in comparison to what its competitors spent last year to acquire new students.

Larry Chen, founder and chairman of GSX Techedu, told analysts during the company’s Q2 2020 earnings call that the top ten players in the market have spent more than RMB 10 billion (USD 1.5 billion) altogether on traffic acquisition and branding last July and August, citing unnamed third-party data.

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