Crazy English founder Li Yang says he has joined Amway

A recent high-profile announcement by the founder of Guangzhou-based Crazy English chain Li Yang about joining American direct-selling company Amway has raised a lot of public attention, a move analysts said Wednesday indicates serious competition among English learning schools in China.

Crazy English was among the first group of English learning schools that opened in the 1990s and used to have a strong reputation, attracting tens of thousands of English learners, especially from the generation born during the 1980s. It currently has branches in 20 provinces and municipalities around the country.

After 25 years of expansion, Li Yang suddenly announced on his Sina Weibo, a Chinese equivalent of Twitter, on Monday that he joined the "global company of Amway in October," without disclosing whether he will still be involved in his English teaching business.

Li explained that the causes for his move include "to pursue success and a sense of achievement, as well as to be part of a global enterprise."

Efforts by the Global Times to contact Li Yang, headquarter of Crazy English and Amway were not successful by press time.

Amway confirmed to the Information Times newspaper Tuesday that Li Yang did apply to become a sales representative of Amway in September.

Calls to the sales and after-sales hotlines of Crazy English by the Global Times Wednesday received replies that all the branches of the school nationwide are still in operation.

Analysts said that Li intends to gain more publicity for himself and his schools through this high-profile announcement on Weibo.

"The market share of Crazy English is shrinking among serious competition from other market players," Shen Zheyan, a researcher at Shenzhen-based CIC Industry Research Center, told the Global Times Wednesday.

Currently there are over 100 private English education institutions nationwide, with some of them running irregularly and in disorder, according to Shen.

Shen said that although Crazy English had advantages in increasing learners' interests during the initial period, it could not sustain their long-term learning enthusiasm.

"A lack of capital investment such as those from the venture capitals is another obstacle it has been confronted with," Shen noted.

Li Yang was quoted by media as saying that the total revenue of Crazy English reached 200 million yuan ($32.82 million) in 2010, which was much less than the revenue of its competitor New Oriental Education and Technology Group Inc that reported 2.46 billion yuan in the same period.

New Oriental, which was opened during the same time as Crazy English, successfully got listed on the New York Stock Exchange in 2006.

Some other education companies including Global Education & Technology Co and TAL Education Group have also gotten listed in the US.

An insider was quoted by the Information Times as saying that "joining Amway is just Li's personal choice, which will have a limited impact on Crazy English."