A fast-growing international student recruitment firm is seeking to raise debt and potentially equity capital to bankroll its ambitious strategy to triple in size within three years, EducationInvestor Global can reveal.

SI-UK operates 62 offices in 28 countries, from which the organisation channels international students into UK universities.

This year – despite coronavirus-induced headwinds and international travel curbs – SI-UK is on track to grow its revenues by up to 25% to approximately £25 million, directors Dwayne Gallagher and Orion Judge told this publication.

Next year, SI-UK is targeting 40% growth, Judge and Gallagher said, noting that the bulk of the firm’s turnover comprises commission payments from UK universities, to which it assists some 50,000 applicants a year.

“Within the next two-to-three years”, SI-UK aims to become a £100 million company by measure of turnover, continuing to enable tens of thousands of students from across the world to achieve their dreams of studying abroad”

To help finance this expansion, SI-UK is exploring a debt raise and could also look to give away a small slice – 10-15% “maximum” – of equity in exchange for capital, Judge and Gallagher said.

SI-UK has mandated Macquarie Group to advise the company on its mid-to-long-term options, which down the line could include an initial public offering, a merger with a larger rival, or an outright sale to private equity, they said. 

Matthew Taylor, managing director, Macquarie Capital, said: “Despite the challenging market conditions created by the coronavirus, SI-UK has proved the resilience of its business model. The company has an unwavering emphasis on delivering great student outcomes by working seamlessly with agents and universities. They are on track to continue to grow strongly.”

When outlining SI-UK’s growth strategy, Judge and Gallagher highlighted a number of levers on which the business can pull.

At present, SI-UK funnels international students into only British universities, for which the company is “the largest recruiter” of international students, they said.

SI-UK has global contracts “with almost all UK universities”, Judge and Gallagher said, noting that “there are only two companies globally with this reach” – SI-UK and Australia-listed IDP Education.

“UK universities are incredibly conservative as to the agencies they work with, and the contracts they provide are almost always very narrowly defined territorial contracts, thus SI-UK’s global contracts are extremely valuable,” said Judge.

SI-UK could also scale in other English-speaking markets, such as Canada and the US, they said, both of which are popular destinations among students from India, where SI-UK has 15 offices and is expanding to 20.

Judge and Gallagher said that SI-UK is able to set up a new office within 30 days and render it “breakeven within a year.” SI-UK aims to have 120 offices in 50 countries by 2024.

In addition to entering new markets, SI-UK is targeting new business generated by partnerships with organisations in the sector.

Last May, SI-UK announced a partnership with Times Higher Education, which “will reach tens of millions of prospective and existing international students who visit THE and SI-UK’s websites annually to provide free placement and consultation services”, the firms said in a statement announcing the deal.

SI-UK recently announced a new partnership with QS (Quacarelli Symonds).

Judge and Gallagher said that “the combined reach of SI-UK with QS allowing client universities the opportunity to connect with the largest number and most diverse range of international students available through any educational organisation, bar none. Together, SI-UK and QS reach well over 110 million unique online visitors per year and manage 700-plus events which, combined, will generate in excess of 800,000 international HE enquiries that will be looking for a good-quality UK education.”

SI-UK will be available to assist students from QS platforms who are interested in UK university study. 

SI-UK assisted with more than 112,000 UK university applications in 2020.

SI-UK also has a software-as-a-service (SaaS) platform, which is used by students, partners and university clients and is “highly scalable”.

More than 90% of students who use SI-UK’s platform do not pay for its ‘premium’ offering, which encompasses mentoring and advanced application services, such as specialist advice to Oxbridge applicants.

Although their ambitions for SI-UK to expand outside the country after which it was named when launched in 2006 are clear, Judge and Gallagher said that their company’s “select focus” on serving UK universities has helped it weather the coronavirus crisis.

Unlike Canada and Australia, for instance, the UK has largely kept its borders open to international students, and the UK government has confirmed two-year graduate work visas for international students, in turn driving long-term demand for UK university places.

As a result, SI-UK – unlike some student-recruitment agencies serving universities in countries whose borders were closed – was able to grow its sales in 2020, despite widespread turbulence in the international student market.  

Gallagher and Judge noted that a number of students recruited by SI-UK opted to defer their September 2020 starts to September 2021, “compressing our conversions” – but the directors stressed that this does not materially impact the firm’s sharply upward growth trajectory.

Date published: 17 March 2021

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