In the first three months, a modest 50 students signed up, but Kanna remains confident: Nearly 1, 800 families took an assessment test on her portal and indicated interest in ChildU's K-8 classes, which are slated to go live in September.

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Perik's target profit margin is the same for the assessment business as for test prep, 20% after tax. (Test prep accounts for 70% of the company's revenues, K--12 the rest.) His risky strategy: Instead of emphasizing customized assessment tests for particular school districts, he plans to deliver a more generic product.

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