Education consultancy Crimson snags millions in Korea play

Jamie Beaton, founder of education startup Crimson Consulting. Photo / Supplied

Auckland-based education consultancy Crimson Consulting has expanded into Asia and raised $6m in South Korea.

Crimson chief executive Jamie Beaton founded the firm, along with girlfriend Sharndre Kushor, in high school in 2013. The company was formally incorporated in 2014 when the pair turned 18 and reached the legal age at which one can become a company director.

To a large extent the company, marketed at tutoring high school students wanting to achieve admission and scholarships to exclusive Oxbridge or Ivy League universities, has traded on the over-achieving brand of Beaton.

He ran the business while concurrently working as an analyst for Julian Robertson's Tiger Funds in New York, and studying business and finance at Harvard and Stanford universities. He is presently moonlighting at Oxford University as a Rhodes scholar.

According to companies office filings, Korean firm Solborn Investments took a two per cent per cent stake in Crimson last month. The new shareholder is the venture capital arm of Solborn Inc, a Kosdaq-listed holding company with a market capitalisation of $130m.

Questions to Solborn Investments this week went unanswered. It is understood Solborn paid $6m for its stake, suggesting Crimson is valued at around $280m.

Beaton said Crimson had worked on expanding into Asia in the past few years and now China was the company largest market outside of Australasia, with Korea close behind.

"The speed with which we've been able to build brand in [Korea] has given us a lot of focus," Beaton said, adding 40 per cent of his company's clients had Asian heritage.

He said Solborn's involvement will "help us further deepen our penetration" into Korea.

The move still leaves the young founders with the largest stake in the company with (Beaton with 34 and Kushor with 10 per cent), with the remainder of stockholders being billionaires solicited by Beaton (New York's Robertson and Chase Coleman with 19 and 5 per cent respectively), and smaller local investor typified by the 8.25 per cent stake raised during a 2014 stint at Auckland University's Icehouse.

While the firm has gained considerable positive press for the precociousness of its founders, the rise from Auckland tutoring business to a firm with global ambitions hasn't been entirely smooth sailing.

The company began growing from New Zealand by using an initial $30m war chest raised from Robertson to roll up a handful of smaller operators. Some of these deals turned fractious, and in 2018 the company lost a long-running fight in the High Court in Auckland to keep secrets details of its dispute with 2015 takeover target Dunedin's UniTutors.

The wider college-admission sector has also recently come in for scrutiny, with the FBI earlier this year busting a $30m conspiracy that involved well-off parents - including wealthy Chinese and actress Felicity Huffman - paying six-figure sums to fraudulently secure prestigious university placements for their children.