HK cult hero is a S$15.4 million a year tutor

HONG KONG — He drives a US$190,000 (S$267,000) Audi sports car, stars in a YouTube pop video that has been watched 1.4 million times and has to limit public appearances because he is mobbed by young fans.

With his coiffed hair and tight-fitting wardrobe, Mr Lam Yat-yan looks like an actor, singer or footballer on a night out. In fact, he is an after-school tutor and the best-known and best-paid of Hong Kong’s celebrity crammers, whose faces adorn billboards and buses across town.

Across Asia, middle-class “tiger mums and dads” push their children to take extra tuition for fear they might fail life-defining university entrance exams. In crowded, frenetic Hong Kong, a handful of top tutors such as YY Lam — as he is popularly known — have capitalised on parental angst and teenage ambitions to build powerful brands and multimillion-dollar fortunes, reaching thousands of students through video classes.

“The educational system here is very strange,” says Mr Lam, in his office in the commercial district of Mong Kok. “Teachers are overloaded with work and they cannot achieve what they want to do the most, which is teaching. Therefore, tutorial classes are essential.”

Adored by tens of thousands of young Hongkongers for his teaching style and business acumen, the 28-year-old Chinese-language teacher was thrust further into the public eye last October when a rival tuition company tried to poach him by taking out newspaper ads promising him an annual HK$85 million (S$15.4 million) pay package.

Chased all over the city by the Hong Kong press pack for a response, Mr Lam was “shocked” by the attention and went to ground, “trying to escape and run”. In his first interview since then, he is nervous, belying the smooth image he projects in classes and promotional videos. “Please don’t make this the focus,” he says. “Because we are working in education, money is not something that we want to discuss too much.”

AN ‘IRRESISTIBLE’ STORY

Despite his pleas, Mr Lam knows the story of his rise from working-class beginnings in suburban Hong Kong to multimillionaire is irresistible. His mother worked in a bakery and his father sewed labels onto clothes before the factory moved to mainland China.

Studying for a masters in Chinese at the Chinese University of Hong Kong, and contemplating a PhD, Mr Lam fell into the business of tuition by chance — or, more specifically, because of tragedy. A vacancy had arisen at Beacon, one of Hong Kong’s biggest tutorial companies, after a young Chinese teacher died suddenly in 2010.

“I just wanted to give it a try as I was young,” says Mr Lam, claiming he had no idea then how much money he could make. “There are very successful people in the industry. But many people have struggled for years. It all depends on your charisma and ability, and how you build up your team and manage them.”

By the end of his first year, he sensed the opportunity as he watched his student numbers rising rapidly. They were attracted by his enthusiasm, understanding of how to tackle university entrance exams and his image as “cool and successful at the same time”.

Tutors such as Mr Lam typically work as contractors for businesses such as Beacon or its main rival, Modern Education. They earn most of their money through revenue-sharing agreements based on how many people they teach. Beacon covers part of the costs of marketing and running the team, while Mr Lam has also reinvested some of the profits from his work into his own promotional endeavours. Today, Mr Lam says he has more than 10,000 students, most of them attending live video broadcasts of classes. He had to cut back teaching in person as he was swamped with questions from enraptured pupils.

More than 100 part-time staff help organise the classes and a core group — known as YY’s team — help him write his notes, mark homework and run marketing, from YouTube videos to his bimonthly magazine, As Artistic as You (circulation: 20,000 plus).

Parents pay HK$590 for four 75-minute tuition sessions and those opting for the video classes get a discount of just HK$20. Their children almost unanimously say it is value for money.

In the hotly competitive world of after-school tuition, education companies are just as worried about “key man risk” as similarly personality-driven tech startups such as Facebook or Uber.

Beacon filed for a stock market listing in Hong Kong in October and its top tutor earned a section in the chapter on risk factors in the prospectus.

“Our operations and profits may be materially and adversely affected if we cannot retain or maintain a good relationship with our Top One Tutor or our Top One Tutor fails to deliver high-quality teaching,” it warned. Last year, the top tutor was responsible for generating 40 per cent of Beacon’s revenue of HK$328 million . That star tutor was paid HK$35 million.

Was that Mr Lam, as widely suspected? He tries, halfheartedly, to brush off the question. “I can’t confirm,” he says. “But it’s obvious.”

His importance to Beacon in the middle of its initial public offering may explain why Modern Education tried to lure him away.

The riches available to the leading companies and teachers are undeniable. But greater competition, reliance on a few individuals and a shrinking pool of students have made exam coaching a blood sport. Poaching attempts are common, several teachers have been accused of obtaining surreptitious access to forthcoming exam questions and a number of disputes between tutors, schools and others have ended up in messy legal actions.

Mr Lam says star tutors feel the pressure to perform as much as the pupils, who are browbeaten by their parents. Preparations start in the morning and continue until the first classes in the late afternoon, once school has ended.

After teaching, Mr Lam returns to the office to work on administration and lesson plans until the early hours of the next day. “We are used to burning the midnight oil and it’s normal to have only a few hours’ sleep,” he says, pointing wearily to the sofa bed in his office. “You can only stand so long in this business.”

His mother warns him about the health risks, but he has her work ethic. Although he provides for his parents and bought his mother an Alfa Romeo, she still works at the bakery.

While Mr Lam has been training his assistants to take over one day, he worries they are not yet ready and that the enterprise will fall apart if he steps down as frontman now.

“To put it simply, if I stop, my staff will be jobless,” he says. “In this industry, if you make one mistake, or your passion fades, the students will feel it and there will be an instant drop. That’s why I say it’s a high-pressure business.” FINANCIAL TIMES