An ‘initial public offering’, or IPO, is not easy to achieve for student recruitment businesses. Few companies meet the regulatory requirements or have the revenue and growth history to reward shareholders while attracting new public investors.

However, for those that manage it, an IPO can be a game-changing way to generate capital and expand a corporate umbrella.

The companies listed here have many subsidiaries, and as such, we should be conscious that student recruitment may not be their biggest revenue stream.

An IPO differs from private equity investment, which we explain here.

1. IDP Education

It’s nearly 10 years since IDP was publicly listed on the Australian Securities Exchange. The initial public offering in 2015 raised A$331.6 million and the company sold a further 125.1m shares priced at A$2.65 each, giving it a market capitalisation of A$663.3m at the time it started trading.

The value of IDP shares peaked at A$38.88 each in 2021 when pent-up demand from the pandemic drove record numbers of students to take IELTS tests and seek university places overseas.

In 2023, the company reported a record A$928m in total revenue, followed by a further 19% increase in net profit for the first half of the 2024.

By June 2024, however, immigration policy disruption in Australia and Canada had caused the student mobility market to retract and as a result IDP issued a market update to investors predicting a 15-20% decline in demand for IELTS tests.

While student counselling services are still predicted to grow over the year ahead, the company is currently restructuring operations, with redundancies taking place in some areas.

While student counselling services are still predicted to grow over the year ahead, the company is currently restructuring operations

At the time of writing, share prices are at A$15.09 each, with analysts estimating the top 25 shareholders own between 60% and 80% of the company.

2. New Oriental

New Oriental Education & Technology Group Inc. operates a wide range of businesses including pre-school education and domestic courses at all levels in Hong Kong and China. It also provides online education as well as overseas study consulting as an agent.

The company has been listed on the New York Stock Exchange since 2006, with a market capitalisation of approximately US$14bn. It launched a further IPO on the Stock Exchange of Hong Kong in 2020.

Michael Yu, New Oriental’s executive chairman, commented on the company posting US$1,207.3m revenue for the third fiscal quarter of 2024, saying: “We are pleased to see a continued acceleration of our growth momentum that exceeded our expectation; our overseas test preparation and overseas study consulting businesses maintained a strong upward trajectory, exhibiting approximately 52.6% and 25.7% growth year over year.”

One of the drivers of New Oriental’s recent success has been achieved through East Buy (东方甄选). In response to the Chinese government banning online ELT tuition in 2021, the company pivoted to convert digital English tuition platform Koolearn into a shopping channel fronted by former English teacher Dong Yuhui. 

His livestreamed content has gone viral, with many fans tuning in for his adhoc English lessons while explaining various produce and products. This unique style of educational product pitches has catapulted East Buy to market category leader and Yuhui to national celebrity. 

3. Navitas 

It can be easy to forget that beyond the operational delivery of pathway courses in partnership with institutions all over the world, Navitas is a student recruitment heavyweight. 

Some universities choose to work exclusively with Navitas to manage international student recruitment through its worldwide network of 2,500 agents, rather than managing them individually themselves. In the UK, the company is also one of the few pathway providers that can ‘recycle’ students who have failed to complete a previous pathway course and progress.

Originally named IBT Education, Navitas Limited floated on the Australian Securities Exchange in 2014 with the original share price of A$1.00 each, raising an estimated A$346.5m in capitalisation. 

Later in 2017, the company launched an investment subsidiary called Navitas Ventures, which included becoming the largest shareholder in Studylink – later sold to Flywire for an estimated A$60m. 

Navitas was delisted from the ASX in 2019 when it was sold to private equity firm BGH Capital in a A$1.5bn takeover. Shareholders accepted A$5.825 per share and the company was taken off the stock market.

4. Crizac

Crizac has experienced rapid growth in recent years and The PIE News understands it has become a Top 5 source agent for the UK market. 

In March 2024, the India-based agent announced an intension to go public with an IPO on the Indian stock market, although the move is entirely an offer for sale of existing shares, with no fresh issue component.

Accounts show that the company’s revenue grew rapidly from USD$13.3m in 2021 to almost USD$56.6m in 2023. 

The same accounts highlight that applications through sub-agents account for a large proportion of the 170,000 students supported in 2023, with only 214 staff employed directly worldwide. 

Speculation continues on when and if the company will begin publicly trading given the current market downturn.

5. Crimson Education 

Another company that has mooted a potential IPO is New Zealand student counselling service Crimson Education, formerly known as Crimson Counselling. 

As visa issuance has become stricter in core markets, the company has announced it will be branching out to provide a premium agency service

The company’s business model has always focused on students wanting to access the world’s elite universities and willing to self-contract premium services to help them achieve that dream. However, as visa issuance has become stricter in core markets, the company has announced it will be branching out to provide a premium agency service to “selected” universities in the near future.

Founded by Harvard Graduate Jamie Beaton when he was just 19, the company has had a range of high-profile financial backers including legendary Wall Street investor Julian Robertson and former New Zealand prime minister John Key.

In 2021, Crimson’s valuation was placed at around a billion New Zealand dollars, claiming ‘unicorn’ status. Pre-IPO stock options have been mooted to potential investors, but no public listing has materialised.