For Profit Edu Sector – Embrace Your Innovators
Approximately 1.5 years ago, I left the innovative company I had helped build, Education Connection. I had found a new innovative company whose mission I loved, and I wanted the experience of working with the “state university” side of the online higher education industry; so I left my comfort zone and moved across the country to Dallas, Texas. I also wanted to “prove” to myself that I could be successful without my two mentors; I felt it was time for me to “grow” on my own.
This turned out to be a necessary part of my ‘journey’ as I was able to grow, learn how to interact with a different group of executives, board members, and cultures and also afforded me to opportunity to see how different working with state universities was vs. for profit universities. I was able to ‘prove to myself’ that I could be successful without my mentors, which was good and bad. Good because it made me more confident…bad because I certainly didn’t need anymore “ego feed”.
By adding this new subset of an industry and connecting with myriads of new individuals, I was able to see one thing: I had been working for (Education Connection) the most innovative and forward thinking group in the education space.
Based on the number of consulting and job inquiries I was recieving while at the second company (post working at Education Connection), I chose to start my own company. I believed this was a way for me to work with multiple companies, multiple executives, and would provide me with an unbelievable learning experience; the ability to interact and learn from the top executives in the higher education industry.
At this juncture, I’ve worked with about ten different higher education service companies, ranging from lead generation to call centers to enrollment management companies; and multiple schools. I have learned a lot, but my biggest learning was this: The only companies that will survive the new for profit education regulations would be the ones that invested heavily and believed in their innovators. In speaking with one of the executives I enjoy working with the most, a brilliant man named John Goodwin, he made a comment I use all the time now. He said, “The companies that come out of this education congressional hearings successful will be the companies that not only listen to their innovators, but more so will be the companies that have the ability to adapt the most quickly to a changing environment.” We were going back to Darwinism.
Having worked with all of these schools and companies, there is only one company that has come forth and displayed a pro-active understanding as well as comprehensive product offering to aid the for profit schools in their quest for higher graduation rates and higher re-payback rates on their loan; that company was Education Connection.
About 5 years ago, my prior CEO and mentor Richard Capezzalli said to me, “What will happen to the for profit education industry in the next several years is going to be cataclysmic.” I vividly remember this as 1) I didn’t know the exact meaning of cataclysmic and had to run and look it up. 2) We had recently started a lead generation company, Education Connection. I thought to myself, ‘why would we have started a lead generation company if the for profit industry is going to be shaken up so badly?’
In the subsequent four years and and 11 months, I learned the reasoning behind our ‘lead generation’ company; we were building a lead gen ‘model’ to learn the best ways to market to students, but the end goal was different. We were looking for students that yielded the highest graduation rates, or net tuition revenue; not solely the lowest cost per acquisition or cost per enrollment.
So after about two years of introducing ‘innovative break through’ #1 (we were the first lead generation company) that had employed prior admissions advisors and were warm transferring leads to the for profit schools at over 10% lead to start conversions; Richard, the innovator, introduced the true reason he was confident that EdConnect could take over the industry; at first, he called it “Future Scholars” (It is now called Test Drive College).
With the goal of advising and working with students who would yield the highest graduation rate, Richard quickly went back to his days of owning and running schools. He explained to his EC management team that 2 of the main reasons students did not stay in school were 1) They were not prepared for the rigors and discipline needed for online learning and 2) Across the entirety of the ‘edu lead generation industry’, we were marketing to people who were not “academically ready”. So, logically – if we were able to find a way to ensure that the students were 1) Academically ready 2) Had the ability to experience online learning (and not just a demo, a true class), the retention and graduation rates would rise dramatically. This would not only effect graduation rates in a positive manner, but would also positively effect loan re-payback rates and minimize loan default rates. There is a direct correlation between students graduating and having a higher payback rate.
The model went live with a large test utilizing two of the large for profit universities as ‘partners’ and while it took a year to get the student retention rates back, the test was wildly successful. “What is the model?” you ask. In it’s simplest form, students take an online accredited course (they can transfer into a school) for free; hence the word, “TEST DRIVE”. In order to be one of the chosen for this free course, the student first must pass a short test (SAT questions – I believe there are 20 of them), which demonstrates the student can sustain the academic climate in a college. Once the test has been passed, the student speaks with an advisor or “gatekeeper” as we liked to call them during the testing phase; whose job is to ensure that IF the student does “adapt” and is a “fit for online learning”, they will enroll in a school post taking the free online course. The goal was to ‘weed’ students out in this free course that did not like online learning. We only worked with students who were serious and who understood the value of the degree, the financial aid process, etc.
The tests were wildly successful. The hypothesis that these students would retain and have higher graduation rates was proven (patience was certainly a virtue as it took over a year for these retention numbers to come back). The company that had been the first to see these regulations would be coming (about five years before they came), the company that quickly executed on their innovative plan, the company whose tests were successful prior to any regulatory discussion taking place – this is the company that is positioned to aid the for profits in their quest to continue to help the students who have nowhere else to go. The company that was the first to embrace their innovator was Education Connection. Will you be next?