Paper Education Co. Inc.’s chief operating and technology officer, Roberto Cipriani, has resigned from the struggling online-tutoring company at the end of a summer that saw steep job cuts and the replacement of fellow co-founder and CEO Philip Cutler.
Mr. Cipriani said in a memo to staff that he was stepping down from his management role but would remain a board member, alongside Mr. Cutler.
“The time has come for me to take a step back and allow new leadership to bring fresh perspectives, taking Paper to the next level,” he wrote. “I know the past few months have been challenging, but we are making progress on our next chapter” under the leadership of interim CEO Rich Yang. He expressed confidence that Paper was “on the right track for better days ahead.”
Paper’s chief product officer and chief people officer have also left in recent months.
Montreal-based Paper, which became one of Canada’s tech darlings during the pandemic, laid off nearly half its head-office staff and all its tutors in Canada this summer, just months after hundreds of them in Ontario and Quebec voted to unionize.
Mr. Yang said at the time that the company had never adjusted its tutor work force once the pandemic subsided and that the company could no longer justify its staff size based on current demand. The veteran Silicon Valley-based education technology executive said focusing on the U.S. market, which accounts for most of Paper’s business, would give the company a chance to rebuild its operation, deliver “consistent, high-quality support to students” and improve its financial situation.
The Quebec branch of the Canadian Office and Professional Employees Union this month said it would take legal action if necessary to ensure employees are treated fairly. Some Paper tutors had also taken to Reddit in recent months to complain about working conditions that included juggling multiple students, irregular shifts and no job security. Mr. Yang acknowledged in messaging to staff last month the “many tutors received minimal and inconsistent scheduled hours, understandably causing frustration.”
Paper has faced several challenges since experiencing explosive growth during the pandemic. The cut to 45 per cent of its 180-person head-office staff in late July was Paper’s fourth such work-force reduction since early 2023.
Mr. Cutler and Mr. Cipriani co-founded Paper 10 years ago to bring better access to tutoring to people who couldn’t afford it, selling a tutoring-by-text service that allowed tutors to handle multiple students at once in separate sessions. By early 2020, Paper had 30 employees, 100 tutors and annual revenue of less than $2-million.
Then the pandemic hit. Educators and politicians fretted about the impact of online schooling, particularly among socio-economically disadvantaged students. The U.S. government committed substantial aid to provide free tutoring.
Paper had the right product at the right time. Demand soared. It signed hundreds of U.S. school districts, selling unlimited, 24/7 tutoring services in contracts that could run into the millions of dollars. It became one of Canada’s fastest-growing startups. Investors, including Softbank, piled in as Paper raised US$380-million in 2021 and 2022, valuing it at US$1.5-billion during a frenzied market for online companies.
But Paper encountered growing pains as the pandemic subsided. With federal funding set to expire, several U.S. districts suspended plans to buy online tutoring. Some clients didn’t renew.
Perceived value for money was an issue, and Paper faced questions about its efficacy in improving learning outcomes. While many U.S. school officials praised it for providing students with greater access to tutoring, low utilization and awareness were challenges.
Meanwhile, those who used it most were often the most engaged students, not the low performers who needed help the most. In response, Paper this year began offering high-impact tutoring targeted to those students, priced on a per-usage basis and delivered at set times with the same tutor.
Mr. Cipriani’s departure was first reported by BetaKit.