Anyone who has done research on any of the many schools that provide distance education will have an understanding that market demand is a partial driver of success or failure. There are online schools out there such as University of Phoenix, Kaplan University, and a few others who are “for-profit” institutions. That said, one can also buy stock in some of the publicly-held corporations that own these institutions. The Apollo Group owns University of Phoenix, for instance.
I have always thought that as distance learning evolves, we would see more institutions offering stock in order to raise capital. That happened again this week with Grand Canyon Education, Inc.
The problem is that the shares took a dive after the market opened. I have a few thoughts on this whole idea of education institutions (or corporations) raising money through an IPO.
- In a market like we have now, someone should have put a stop to the whole process. This is a really bad time for stocks and a worse time to offer an IPO. It was not a smart idea for a short term effort to raise money.
- The distance education market is still in the early stages of what promises to be a long-term win. But that doesn’t shield it from the cyclical behavior that plagues other industries.
I believe that the “hype” that has surrounded distance education over the past couple of years is currently in a depression. Based on the economy as a whole, people are afraid to spend money on an education right now. A lot of jobs are being lost every day and a degree means almost nothing in an economy that is bleeding. It will be difficult for a lot of people to get a job no matter what education level they have.
I think that if a person were buy stock in education, it would probably be a long term win. In addition to waiting for the economy to rebound, there has to be some reinvention in the online education market. It has become almost bland from an investor standpoint. Perhaps Grand Canyon or Apollo will notice that and make some moves in the next year or two to separate themselves from the rest of the pack.
Time will tell.
With almost six consecutive years dedicated to distance education, Scott has the experience to answer any questions you may have about the topic. Please feel free to contact Scott about anything having to do with online education. You can also check out his photo blog or his LinkedIn profile.
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About WheelCipher
Scott is a strategic consultant in the customer care industry and an avid amateur photographer.
You can see his work at http://gallery.scottdavis.info
He has experience in the high-technology industry in management, engineering, and support positions with Time Warner Cable, Dell Computer Corporation, UUNET Technologies, Wayport and others.
Scott started his degree program in 2003, and had no prior college credit before jumping into the distance learning environment. He graduated in October 2007 having attained an A.A.S. in Information Technology and a B.S. in Management from Kaplan University.
In 2009, he graduated with his MBA from Norwich University and is now a student at Gonzaga University.
Scott LOVES fan mail. You can e-mail him any questions about distance learning at sdavis@wheelcipher.net