With the highest unemployment rate in the last 15 years, even IIT/IIM graduates are struggling to find a job.

What happens as a result?

Most of the students turn to higher education. Especially, for Masters programs in countries like US, UK, Canada, Australia, Germany etc.

In 2023, there was a record 35% increase in international applicants 🤯 from India. This started a gold rush for study abroad consultancies, opening up in every corner of cities like Tea-stalls.

The gold rush of Study Abroad Consultancies

Opulent banquet halls, 5 star hotels, larger than life expos. Big consultancies have counselors flying in from across the world, celebrity endorsements and massive offices.

The events have free attendance, what harm can it do to visit? Hopeful students and worried parents turn up in droves, seeking a magical path to a secure future.

The trap for students and parents

Walking into a consultancy, you are greeted by an intimidating wall of admit letters. Looking at photos of previous students who made the dream, you're thinking,  "They look happy, successful. Their life is set, ahh! I wish I was in that position right now".

The counselor then welcomes you, carefully listening to all your problems, giving helpful advice and reassuring that everything will be okay.

We will guarantee you an admit. Everything will be taken care of.

Consultancies have 2 types of offers:

1. Guaranteed admission for INR 100,000.
   
   Or
2. Free counseling, no charges at all.

Either of these look like a great deal, when the odds at stake are your entire future and career. But where does it all go wrong?

Reality check, how much does a consultancy cost?

The massive offices and events don't happen without money. Large consultancies with 100s of employees, ready to serve you day and night are not doing this for charity. Bollywood stars and international professors don't fly in to help students for social service. 5 star hotels don't offer their venues for free. You need crores of Rupees to make this happen.

Example of celebrity advertisements on study abroad consultancies.**

Let's do some reality check mathematics:

1. Time required for application of one student = 40 hours of work (dream scenario. In reality even the smartest, IIT-BITS students work for months on their applications)
2. Number of applications possible for one person in a month = 4 (with a 40hr work week)
3. Application season = 4 months in a year

In one year, a single consultant can complete 16 student applications, if they are super efficient.

Now let's look at how much this costs

1. Costs of applying to 5 universities = 50,000 per student
2. Other costs: tech support, office space, advertisements, support staff etc. = 200,000 per month
3. Salary of a person skilled enough to build applications that will be accepted at international universities = 2 lakh per month. (The average salary for entry level jobs is $60,000. If the consultant is earning less than this, they will go for studying abroad themselves)

For a consultancy with 10 agents (160 students):

• Expenses = 2.4cr (salaries) + 24 lakh (business costs) + 80 lakh (application costs for 160 students) = 3.5cr
• Revenue from 160 students = 1.6cr (1 lakh per student)

That's already a loss of 2 cr per year. Call my math bullshit, halve the costs and double the revenue, you still end up with a few lakhs per year.

How are these consultancies earning millions?

^ Example of professional advertisements from study abroad consultancies.**

Behind the scenes: The dark underbelly of Study Abroad consultancies

When a student goes through the consultancy, the real income is not from your payment, it is from affiliations:

• Percentage of fees from partner private universities = lakhs per student.
• Revenue cut from = education loan providers, travel agent, insurance agent, student housing accommodation provider, visa agent, travel cards and forex etc.

For this to be profitable, the student needs to go the private universities and use services which have a partnership with the consultancy.

Almost all consultancies have a standard playbook:

1. Find a weakness / insecurity in the student profile (low GPA, tier 3 university, not enough work ex, not enough research publications)
2. Suggest that private university has better chances. (or other insurances can be rejected, use xyz instead...)
3. Take full control of your application (they create your accounts, fill up forms, do everything for you. Full convenience, zero transparency).

The biggest problem here, is that the innocent students and parents pay the ultimate price.

These are not the Indian students who work at Google or Apple, they are exceptions. Many students paying consultants to go to private universities end up without good jobs: some come back to India or some end up working low skilled jobs (uber, restaurants etc.).

If you think this exaggeration, think again. This was just the cleaner part of the real picture. There's a lot more going on with study abroad consultancies:

• Article 1
• Article 2
• Article 3
• Article 4

There's hundreds more incidents...

But what should we students do then?

At CareerSky, we are trying to build a new model. The fundamental observation is: "All the help you need in the world can come from 3 sources":

1. Technology - ChatGPT / AI can literally answer 90% of your questions: "Review my essay", "Explain how MS applications in Germany work", "Which are the top universities in Aerospace engineering?". Technology can replace majority of a consultant's work. We also invested a lot in free, structured guides so that students don't need to pay for information. (think Wikipedia)
2. Communities - bring a 1000 students together, and they will be much stronger together than alone. This model has worked in the past (Stackoverflow, Quora, Reddit, Facebook...). Communities are a selfless space, people help each other only for the sake of helping. We are building such a community for studying in Germany. The hard part about communities is the initial time, when people don't join until there is a critical mass. But we will get there with time.
3. Mentors - Who better to ask for advice than people who actually studied at top universities in the world and work at companies like Google, Microsoft, Apple etc

A coach helps the athlete become better, but doesn't run the actual race for them.

You are in charge of your college applications. The mentors give you advice from their experience of building successful careers.

For this model to work, the students need to put in the effort. A mentor or fellow student in a community is not going to create your resume for you. They will not sit for hours for free to write your essays. These people have their own jobs, studies and careers.

You won't get the convenience of a consultant, but you also won't get screwed over like one. The mentors / students have no control of your application, they can't force you to private universities or get revenue cuts from services like insurance providers.

Conclusion

Democratizing information and building open communities is the way of the future. We are here to change the system, and many million dollar businesses will not like it. There will be criticism from consultancies, understandably so. But if any of these thoughts resonated with you, you can contribute by spreading the word, helping build the communities and improve the open sources of information.

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**Disclaimer: The pictures and videos of consultancies in the article are for representative purposes only. We are not calling out these specific businesses.