Leaked reports revealed that Wall Street English China is filing for bankruptcy. But if you look at how they make money, it's not all that surprising.
They don't make money by helping people learn the language. The business is based on financing.
Students need to pay for a year or several years' worth of tuition in advance. Their salespeople use aggressive tactics but in the end it's all relying on using a loan to pay for it monthly instead.
The loans come through private lenders. While there isn't much info on the exact interest rate, this private lending market is regulated by a max 36% annual interest rate. So even 10% would be on the lower end of the spectrum.
But regardless, Wall Street English gets the full tuition amount up front, plus whatever commission the lenders give them. It's all about repeating this process by signing more new students.
From an ecommerce operator's perspective, it's unbelievable they lasted this long through the infinite complaints, even before the recent government crackdowns. There are countless stories of how people ended up with enormous amounts of debt. Some as high as $20K USD. People share how bad their experience was. How they never got their refund or paid monstrous fees in the process. All things that can kill a store in Tmall.
Now it's very unlikely Wall Street English China is going to refund 1.2B RMB worth of unused tuition while they're behind on paying their own employees. Meanwhile all the students are stuck with debt.