In 2022, a recurring topic of focus in the international education world was the role and rise of education agent aggregators. Established players like ApplyBoard and continued to market their rapid growth, measured in terms of new educational institution clients, expanding geographical reach, and new recruits to sub-agent armies numbered in the thousands. New aggregators also joined the fray, often as pivots from ‘traditional’ education agency business models, or other international education businesses, for example: I-Unite, and UniApplyNow.

Along with these stories of incumbent growth and newcomer aspiration were reminders of the unavoidable risks that attach to education agents and education agent aggregators. In Canada, CBC investigative journalism program, The Fifth Estate, shone a light on international student recruitment in Canada, including the role of education agents and aggregators. CBC’s hidden cameras caught multiple agents making misrepresentations about living, working and studying in Canada. In Australia a 60 Minutes story on human trafficking, and a parallel series of media articles, implicated education agents in facilitating the trafficking of international students into the sex industry. In the wake of that story, Australian regulators issued a “sector alert” reminding all higher education providers of their obligations when using education agents.

In December 2022, an ICEF podcast dived deep on the agent aggregator model, and explored concerns around how sub-agents are recruited, vetted, trained and monitored. Panel member Eddie West, Assistant Dean, International Strategy and Programs, San Diego State University, said:

I feel like the arrival and emergence of aggregators has massively set back the cause of transparency, because now all of a sudden if you are working with an aggregator you yourself as an institution often don’t know who those thousands of sub-agents are who are representing you. That’s not good.

Sub-agent risk rising?

The rise of the education agent aggregator business model potentially exacerbates the prevailing risk of low quality sub-agents acting in a manner that is detrimental to the students they are interacting with. Why? Because executing on the education aggregation model is a numbers game, and the competition is heating up.

To be successful an aggregator must ‘make’ a market by bringing together sufficient numbers of educational institutions and sub-agents to deliver benefit for both sides. If one side of the market lacks critical mass the model fails.

As incumbent aggregators seek to scale quickly and new entrants try to establish themselves, the result is intense competition between aggregators to win the attention and loyalty of sub-agents who can provide the vital flow of student applications. The chart below shows how this competition has played out over the last few years. The clear trend is very rapid growth in the sub-agent networks of the main players, but even in cases where growth has been flatter the aggregator has a network of at least 1000 sub-agents.

Aggregator Graph – 2023

It’s what this competition for sub-agents means in practice that raises a red flag on sub-agent risk.

Here’s why.

Any education agent aggregator – large or small – has a limited number of options when considering how to compete to recruit sub-agents.

  1. Offer sub-agents lots of institutions – this is essential to attract sub-agents. The biggest aggregators represent over 1,000 educational institutions. An alternative to huge numbers of institutions is differentiation through specialisation, with an aggregator focusing its client list building efforts in a specific country or geographic region, or an educational discipline or level.
  2. Offer sub-agents a ‘premium user experience’ – this is mainly about the quality of an aggregator’s online platform and the support services it can offer sub-agents, including training. The big aggregators have invested heavily in this space. The advances they have made in infrastructure, systems and processes represent a rising barrier to entry for smaller players, who are not in a position to match the technology and training investment of their larger peers.
  3. Compete on price – aggregators get paid on commission (i.e. by splitting the commission paid by institutions when students are enrolled with the sub-agent who referred the student), through subscriptions fees (i.e. sub-agents pay to join and use the aggregator’s platform, institution client list, and support services), or through some combination of the two. An aggregator can seek to win more sub-agents by competing on price. This simply means that Aggregator A structures its commercial proposition so that a sub-agent with a student to place at a given educational institution will make more money by using Aggregator A’s platform than if it used the platform of any other aggregator it is working with. It is also common for aggregators to offer short term cash bonuses to sub-agents to stimulate the flow of student applications at certain times. In either case the room for maneuver is limited. A financial honey pot sweetened too much for sub-agents will leave the aggregator with insufficient revenue to support a viable business.
  4. Reduce the barrier to entry for sub-agents – this is where the big risk lies so we’ll jump out of this list and explore it in detail below.

Objectively, by far the easiest way for an aggregator to grow its sub-agent network is to make it easy for new sub-agents to join by reducing or relaxing the barrier to entry. Most education agent aggregators claim to vet their sub-agents. They use words like ‘trusted’, ‘vetted’, ‘screened’ and ‘curated’. Typically the detail behind those worthy catchwords is light. How exactly are aggregators conducting initial due diligence on prospective sub-agents? How are they doing ongoing due diligence on the huge numbers of sub-agents already on their books? Visit an aggregator website, and you won’t find much detailed information to set your mind at rest. There are exceptions: for example in late 2022, ApplyBoard posted a step-by-step explanation of its due diligence process for its ‘recruitment partners’.)

If, as discussed above, building a critical mass of sub-agents is essential to the success of the aggregator business model, the temptation to reduce or relax vetting standards for new sub-agents must be strong for any education agent aggregator seeking to recruit sub-agents in an increasingly crowded and competitive aggregator market. If that assessment is correct, it may be regarded as another red risk flag waving alongside those hoisted by others. In the ICEF podcast cited above, Eddie West said:

A lot, if not all, of these sub-agent networks are anonymous. They are just behind the cloak of the aggregator and, as someone commented online recently, anonymity and accountability rarely go hand in hand.

When that lack of transparency is overlaid with a commercial environment unconducive to rigorous due diligence on sub-agents, the potential risk to students is a serious concern.

"The temptation to reduce or relax vetting standards for new sub-agents must be strong for any education agent aggregator seeking to recruit sub-agents in an increasingly crowded and competitive aggregator market." Click To Tweet

What can educational institutions do?

How can educational institutions working with aggregators address the risks identified above? A simple response, and one that is easy to implement, is to hold an agent aggregator to account for its sub-agent network by asking these 5 questions on a regular basis.

It is also important that any institution working with education agents and/or agent aggregators implements its own agent due diligence process. AgentBee’s education agent due diligence solution supports educational institutions to implement best practice education agent due diligence.

Educational institutions can use it to:

  • do due diligence on education agents – check new agents before agreeing to work with them, and run regular checks on current agents.
  • protect your brand – detect cases of unauthorised agents using your institution’s name, logo or other IP without permission.

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