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VIP Peilian: Largest One on One Music Tutoring Platform with ~$360M annual revenue run rate
Started in 2014, VIP Peilian introduced live piano tutoring classes in 2016, in China. From $800K in 2016, the platform has grown to over $360M within 4 years and introduced over 32 music instruments.
After writing about Meishubao- live art tutoring platform, I wanted to keep the flow going and write about one of the largest live music (piano) tutoring platform from China- VIP Peilian (VIP陪练). Compared to art, this does not seem unusual since YouTube has ample video content for teaching music and it’s often the natural avenue for beginners. VIP Peilian has been able to create a unique offering by targeting young children who often go to offline music centers for hobby classes. Coupled with technology, it has made experience seamless for students and parents. Can it replace offline experience? Let’s find out.
VIP Peilian: Live One on One Music Tutoring
VIP Peilian is an online music tutoring platform where children (5-16 YO) can learn over 32 music instruments (piano, guitar, violin, etc.) in a live class format with teachers having rich musical background. Started in 2014, it took the company almost 2 years to go through rounds of experiments and figure out the live tutoring approach. Currently it hosts around ~30K classes on daily basis.
China Music Training Market is expected to reach $57B in 2020
Over 25% of the music training market is expected to be online, making it ~$14B market with Piano training being one of the hottest segments. Covid has pushed parents to try online media, only to realize that it provides convenience and similar experience, if the child is able to adopt. The penetration of music education in China is only 4% so far, which is pretty low compared to 40% in western countries. So, the market has much more unrealised potential! Source
VIP Peilian is endorsed by the topmost Pianist in China- Langlang
Students can learn upto 32 instruments like Piano, Violin, Flute, Guitar, Drums, Ukulele, Saxophone, etc. VIP Peilian provides access to high quality music teachers from top music schools in China with high liquidity, since parents can book and attend a class within 2 hours.
Instead of focus on ‘teaching’, company talks about ‘practice’ with a qualified teacher who can accompany the students and make the classes interactive. Parents can also read detailed feedback about performance of their child on the app. Head teacher provides a one on one consultation to help students pick the right course based on their aptitude.
VIP Peilian tries to mimic the experience of an offline class with help of technology.
After purchasing a package (post a free trial) from VIP Peilian, the company ships a camera reflector which can be attached to the tablet and can project the keyboard to the teacher at the other end.
Here’s a video for a demo class:
Classes are booked through the app, and after scheduling the lesson, student/ parent can share the photograph of the music notes for the class or select the music books on the platform. During the class, teacher will take notes of the errors and guide the student accordingly. The feedback summary is also available on the app, along with the option to play the session video.
Students can select a standard teacher (1 credit for 50mins) OR a higher level teacher (1.2 credits for 50 mins). Classes can be either 25 mins OR 50 mins.
VIP Peilian seems to be popular in 6- 10 YOs.
~80% of users of VIP Peilian are in the age group of 6- 10.
VIP Peilian has a rigorous process of selecting the teachers and training them further.
Currently the platform has over 30K+teachers from over 80% of well known music school across the country. For teacher selection, the company has formulated a strict teacher selection system, as potential candidates need to go through seven processes including screening, testing, training, and assessment, after which the final employment rate is ~3%.
VIP Peilian has invested ~$10M to for R&D in music education and partnered with over 150 music schools which provides them exclusive access to trainers.
VIP Pelian has raised over $165M and outgrown investors expectations by 10X
Although VIP Peilian is an early mover, competition has been getting fierce!
VIP Peilian has been trying to differentiate through high quality teachers and signing up Langlang as the brand ambassador, but it is not enough. Due to low barrier to entry, many players have been entering and increasing the CAC over time and disturbing the Unit Economics.
Note: We haven’t taken the self led music learning platforms in the above context.
To maintain strong unit economics and expand its scope, VIP Peilian launched an AI powered self led class for 3- 8 YOs- XiaoMa AI Peilian (小马AI陪练)
In November 2020, the company launched a product- Xiao Ma AI Peilian which is a self led piano training app which uses high precision recognition and matching algorithms to correct children’s wrong sounds, rhythms etc. XiaoMa (小马) in English means little horse which acts as an interactive element to keep the kids interested in the class.
Demo of the class:
This can help company expand the user base (younger students) and also cater to students who find live classes expensive.
XiaoMa AI Peilian is analogous to Meishubao’s new product- Xiao Neng Meishu.
India poses a great opportunity up for disruption in music education
Music Instrument market in India is expected to reach $3.7B which is $6.6B in China in 2020. Source
Using the above as a proxy, India also poses a sizeable opportunity but currently the market seems more fragmented. Even during the pandemic, the conventional music schools (which operate like Mom and Pop stores) have pivoted to online training via Zoom but we haven’t seen emergence of a tech empowered platform yet.
If you are building live tutoring platform for music, drop me a note: email@example.com
What can we learn from VIP Peilian?
Standardization of pedagogy and course content can create a niche into a large opportunity
Just live video can’t solve for mimicking offline experience in extra curricular classes, it must be aided by technology (and hardware)
Going deep into one vertical has led to emergence of strong brand recognition compared to going horizontal across categories.
Designing self-led products with focus on the audience (3- 8 YO) can aid in standing tall in a competitive market and provide for synergies across the portfolio.