Daybreak - How do you get JEE aspirants to stay in school? Hire 200 IITians.

Episode Date: September 11, 2024

India's tuition republic came into the picture to fill the gaps in the education system. First and foremost: they promise to get you into the college of your dreams. That simple but powerful promise has made this a Rs 58,000 crore industry. But there is a flip side to this. It puts traditional schools in a rather precarious position. Students start trickling out of the system after class 10. Their parents transfer them to junior colleges or schools with integrated coaching models so they can focus on cracking competitive exams. One school has had enough of this. It's tackling attrition by taking on these coaching centres directly. The first step? Hiring 200 IITians. Tune in. If you've been wondering what The Ken is all about and why our subscribers love us, here is your chance to find out. Check out our special 30-day trial curated just for you.To apply for the latest job openings in The Ken's podcast team, click here.

Hi, this is Rohan Dharma Kumar. If you've heard any of the Ken's podcasts, you've probably heard me, my interruptions, my analogies, and my contrarian takes on most topics. And you might rightly be wondering why am I interrupting this episode too. It's for a special announcement. For the last few months, I and Sita Raman Ganeshan, my colleague and the Ken's deputy editor, have been working on an ambitious new podcast. It's called Intermission.

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love us so much, here is your chance to find out. All you have to do is sign up with your email and start reading. Just log on to the-kin.com slash trial. And now, On to the episode. I think you'll agree with me when I say that the Indian education system is just not for the faint of heart. Think about it. You're expected to know exactly what you want to do with your life by the ripe age of 15 or 16. You want to be an engineer, a doctor maybe, a journalist, a consultant. Regardless of what you pick, the goal for the average Indian student is to get into the best possible college that they can.

And that usually involves some sort of competitive examination. We all know how those can be a real ordeal, especially if you want to get into an IIT or a top medical college. Those often require way more time and effort than even the board examinations. Now, this is exactly where India's tuition republic enters the picture. India's coaching centers came in to fill the gaps in the Indian education system. But first and foremost, they promised to help you get into that college of your dreams. That's simple but power.

promise has made this a 58,000 crore-rupy industry. The flip side, of course, is that they've put traditional schools in a rather precarious position. You see, students start trickling out of the system after class 10. That's because their parents often put them in junior colleges or schools with integrated coaching models. But one chain of schools has had enough. I'm talking about Orchids the international school. This decade-old chain of schools has over 90 schools to its name and is backed by peak 15.

The reason we're talking about Orchid School today is because it's dealing with an age-old problem in a pretty unique way. Over the last two years, the school has hired about 200 IITNs to teach subjects like physics, chemistry and math. The goal is to tackle attrition by improving its in-house STEM education quality. So less students ditch regular schools after grade school. 10 for coaching institutes and open schools. Orkids is still relatively new. It's building its brand. It's building its legacy.

And it's still struggling to find its footing. So this model where IITs teach engineering aspirants could be just what it needs. But it's not easy to pull off. In this episode, we delve into the Orkid School's unique business model and how it is waging a war on IIT coaching. Welcome to Daybreak. A business podcast from the Ken. I'm your host, Rahil Filippos, and I'll be joining my colleagues Nika Sharma

every day of the week to bring you one business story that is worth understanding and worth your time. Today is Wedness Day, the 11th of September. Meet Rahil Kote. He's a mechanical engineering alumnus of IIT in Dore who now teaches at a branch of Orchid School in Bangal. He spoke to the Ken reporter Alifia Khan recently about how he got into IIT back in the day.

Rahal actually dropped out of his school and joined a junior college which had a tie up with a coaching centre. Now like all other students who went down the same path, the goal was to be able to spend more time preparing for the J.E. entrance exam. Rahil admits that it was a very challenging transition. Suddenly he had to switch from road learning to a more conceptual approach. He says that he was struggling with concepts that were taught back in class 8 and 9. In fact, most coaching centres are actually prepared for that sort of thing.

So the first few weeks of coaching are typically spent clearing basic concepts for students, which could have been done in lower classes. Now, that is where Orchid schools' trump card lies. To arrest the loss of students post the 10th grade, Orkids is trying to one-up coaching centres. So it's hiring IITians like Rahil. The goal isn't just to help J.E. Aspirants clear entrance exams. It's much more than that.

Rahil says the key is bringing conceptual clarity from class 6 itself. The idea is for students to have a solid foundation of learning. So eventually when they get to it, clearing a competitive exam like the JEE is a piece of cake. And who better than an IITAN to do that? They've gone through the grind and are therefore better equipped to tell you what to do rather than someone who hasn't. They aren't just teachers.

These IITians are sort of like career guides and mentors for the students. Branches with high schoolers have three to five IITNs as teachers, and the higher the number of students in these classes, the higher the number of IITNs as faculty members in that particular school. Now, this unique schooling model seems to be working. More and more students seem to be sticking around beyond the 10th grade. Back when COVID happened in 2020,

there were just seven students across its schools in grade 10. Fast forward four years, and the figure has not. reached about 2200. And Orchids is constantly innovating to tackle attrition. In fact, it is now moving towards its own JEE coaching model through R Squared X. It's an after-school program for classes 8 through 10 students, currently being offered in 11 branches for less than $1,000 per month. A similar program by a coaching institute would be priced pretty differently.

Take the annual cost of Allen Institute in Kota. Their pre-nurture and career foundation course for class 9 is about $78,000, while for class 10, it is $88,000. So that brings us to the next question. How does Orchid do all of this? What is its business model? Now, you're probably wondering how Orchids manage to get IITNs to become school teachers in the first place. It's a valid question.

The answer to which is timing. The school chain has been capitalizing on the current placement slump. You see, a couple months ago, hundreds of students from the 2024 batch were struggling to find jobs. Some even settled for offers as low as $6,000 per annum. So Orchids went all out hiring during this period. Once they were hired, these IIT passouts were trained for a few weeks on how to teach. They are then assigned to an experienced teacher to guide them on how to control a classroom. So how is Orchids even able to afford IITNs as professors?

Sure, there's a slump in hiring at the IITs, but we're talking about a school where the average teacher makes between 40 and 50,000 rupees per month. Jay DeCosta, CEO of K-12 Techno Services, which is the parent company of Orchid School, explained the economics of it all. Before switching up its strategy, the school was spending about 9 crore rupees on faculty salaries. The amount rose to 12 crore rupees after they added IITNs to the mix. But the obvious next question is whether the difference in salaries

is a point of contention, especially for non-IITians who are paid less. Well, Jay says not really. Even if it irks them, they realize it's part and parcel of any school system. For instance, a teacher who has taught in an IB school gets paid more or an English teacher gets higher pay than any other language teacher, someone with a diploma and pedagogy from a foreign institute may get paid more.

But what happens once the job market bounces back? Will orchids see an exodus of IITs? bread teachers? Well, DeCosta told the Ken that they were prepared for that sort of thing. They assumed that some will turn out to be bad and trickle out of teaching within a year or two. But he says it's a lot like when regular teachers leave and join other schools. They'll just find someone else to replace them. He pointed out that there was no dearth of IITians looking for jobs. But hiring from IIT is just the beginning.

Orchid School has bigger plans. So Orchid seems to be taking care of all the jobs. J.E. Aspirants. What about everyone else? You know, students preparing for careers in law, medicine, accountancy. Well, that's what Orkids hopes to focus on next. If the JEE experiment is successful, the school chain plans to hire other professionals to prepare students for careers in medicine, law and accountancy. Hiring people from top tier colleges like IIT helps Orkid schools and its parent company K-12 techno services in another way. They can also double up as content. generators. While most of the base content can be generated using generative AI, they still need

moderators to fact-check and keep things relevant. And that is where this faculty comes in. So, teaching isn't the only aspect involved. K-12 techno services has a finger in every pie. Not only is it running its own schools under the Orchids brand. It's also providing services to other K-12 schools, under which 800 schools take its content and other services. But at $1,000 a month, how will the after-school coaching program be monetarily sustainable? The business model may make sense for the school, but can it generate the same success as a coaching institute? Well, people in the business say that it looks unlikely. And that's because coaching centres are fundamentally different from schools in many ways,

first and foremost being that schools have to be more inclusive. Meanwhile, for Orchid School, making the model success, won't just be business as usual. It'll be about finding a niche in a 58,000 crore-crowed market where trust plays a major role. The owner of one particular coaching institute

put it pretty nicely. He said if it was so easy to break the coaching model, every school would just go out there and hire a few IITNs. But it's just not that simple. Daybreak is produced from the newsroom of the Ken India's first subscriber-focused

business news platform. What you're listening to is just a small sample of our subscriber-only offerings. A full subscription unlocks daily long-form feature stories, newsletters and podcast extras. Head to the ken.com and click on the red subscribe button on the top of the website. Today's episode was hosted by Rahil Filippo's, produced by me Snigda Sharma and edited by Rajiv Sien.