Think at London Business School
COVID-19 and global lockdowns have forced consumers to change their behaviour. Understanding the shift – and responding to it – is key
By Gary Dushnitsky, Dan Ziv
More than a billion children and young people are out of school as a result of the coronavirus outbreak, which has disrupted lives and economies in almost 200 countries around the world.
With children forced to stay at home where many parents attempt to home school, one could argue that London Business School alumnus George Sun’s digital Mandarin and Chinese culture programme was well-placed to cater for a sudden spike in demand for online learning.
But KK Mandarin faced a problem similar to many other startups in the edtech market. As the crisis deepened, many well-known and well-funded software companies started to offer free online classes to help support the needs of students.
One would imagine that their long-term goal would be developing their brand presence in the sector and eventually converting their services into long-term revenue streams as digital learning tools and platforms are likely to become increasingly embedded into the long-term strategy of schools and universities and the mindset of learners.
Video interview: George Sun shares tips on reviewing wage compensation in a crisis:
KK Mandarin was in the same boat. It was keen to ramp up supply to cater for the sudden demand, especially from Chinese parents abroad, but without being able to generate the extra funds to be able to pay its staff for the extra teaching hours as well as maintain existing operating costs and payroll.
“All we could was to cut down our costs,” says Sun, a former Managing Director at Deutsche Bank.
Speaking to Luisa Alemany, Associate Professor of Management Practice in Strategy and Entrepreneurship and Academic Director of the Institute of Innovation and Entrepreneurship at London Business School, Beijing-based Sun, who worked in banking for a decade, highlights cashflow management as the most valuable lesson from London Business School’s Masters in Finance programme.
He is emphatic that the knowledge he gained from the School’s top-ranked MiF almost two decades ago gave him the tools to shrink KK Mandarin’s balance sheet and maximise efficiency per employee, while allowing him to offer security to his workforce.
“External fundraising wasn’t going to be an option. The market is really difficult right now and we don’t have enough convincing data to show investors. We had to change the plan. We must now rely on internal cash flow. Our actions means we are more relaxed. We have guaranteed cash flow for 12 months.”
This is the fourth in a series of videos produced by London Business School’s Institute of Innovation and Entrepreneurship (IIE), profiling entrepreneurs who have overcome significant challenge. To watch the previous films and find out about new films, follow @LBSEntrepreneur or #LBSResilientFounders.
George Sun is CEO and Founder of virtual Mandarin language and Chinese culture education technology firm KK Mandarin, based in Beijing. Before this, he worked in banking, with management roles at HSBC, Morgan Stanley and Deutsche Bank, as well as venture capital firms. He was CEO of China Merchants Kunlun Capital, one of the largest private equity funds in China, for almost four years between 2011 and 2014.
The views in this video are his own and are not representative of the IIE or London Business School.
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