Education consultancy Crimson defends wage subsidies
Heavily-backed New Zealand education consultancy Crimson Education has defended drawing upwards of half a million dollars in subsidies from the country’s coronavirus job-saving scheme.
Prominent New Zealand-based education mentoring and admissions consultancy Crimson Education has defended tapping more than half a million dollars in wage subsidies from the nation’s $14 billion coronavirus job-saving scheme. The altogether $527,131 in tax-payer funds was claimed in respect to 77 positions, with the company citing a significant disruption to the education sector brought about by the pandemic.
The firm, however, has drawn flak for its participation in the national employment scheme, with the criticism stemming from Crimson’s 2019 valuation at an estimated worth of $360 million and its roster of wealthy backers, among them US hedge fund billionaire Julian Robertson and former New Zealand prime minister John Key. No allegations of criminal financial impropriety have been levelled against the company.
The consultancy meanwhile maintains that it meets the funding eligibility requirements, which in the initial round required employers to have experienced a 30 percent Covid-related fall in revenues for one month during the first half of the year as compared to the corresponding month of 2019, and in a written statement the firm said that it currently had no plans to repay the money while market uncertainty persists.
In respect to disruption in the international education sector, which largely pivoted online in the wake of the pandemic, the company indicated that while many of its global staff were able to continue working from home, it wasn’t necessarily the case for all of its employees. “Without the wage subsidy, and other cost savings, we would have faced the prospect of job losses,” the consultancy outlined in the statement.
Founded in 2013 by current CEO Jamie Beaton, together with fellow Kiwis Fangzhou Jiang and Sharndre Kushor, Crimson Education is considered one of the bright lights of New Zealand’s business and start-up scene. The firm employs a data-driven model to help students around the world gain admission to some of the world’s most prestigious universities, such as Harvard, Yale, Oxford, Cambridge and Princeton.
According to its company website, Crimson Education has mentored over 400 ambitious students through to IvyLeague or leading UK university offers, along with scores of others to high-ranking universities throughout the US and England. Since its launch, the firm has expanded its operations to more than 20 countries across every continent, and has previously claimed a 3,000-strong international roll-call of advisors and tutors.
Such growth has attracted the attention of well-heeled backers, and so then opprobrium for taking advantage of a scheme intended to support struggling businesses and protect everyday jobs. Along with backing from Key and Robertson, the latter who has a personal fortune in excess of $4 billion and holds a 17.7 percent Crimson share, the company in late 2019 before the pandemic broke secured $20 million in Series C funding.
