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Education Aid, Inc. Announces New Jersey Student is First Winner of $5,000 Support a Student Scholarship Program

Rutgers University student benefits from innovative scholarship program.

Tenafly, NJ – (January 31, 2012) -  Education Aid, Inc. announced the winner for their first-ever self funded Support a Student Scholarship Program for a New Jersey student attending a New Jersey State school.  The recipient, Sasha Bostick, is a bachelor’s degree candidate studying Sociology at Rutgers University and a single mother of one.

The scholarship program was developed to help economically disadvantaged students who are at risk of dropping out of school due to a lack of financial support.  With the Support a Student Scholarship Program, Education Aid has developed an innovative approach to making education accessible to many students who would otherwise not be able to afford to go to school.  Students who need to work and go to school at the same time, especially single parents, face many responsibilities that sometimes prove to be too much of a financial burden and their education suffers as a result.

“In the Fall of 2011 I was thinking about dropping out of college after already taking 114 credits toward my major.  I am raising a son while attaining my bachelor’s degree.  I found myself having poor attendance because I could not afford daycare for my son.  Also, not having enough financial aid to pay for books was a major issue and caused me to fall behind in my courses.  I was selected to participate in this scholarship program through Education Aid and now I am receiving the daycare that I need for my son, enabling me to attend my night classes.  Education Aid also bought my required textbooks and replaced my broken computer, which I could not afford to fix.  I would not be enrolled in school this semester without this help, and will use this opportunity to attain my degree in Sociology.” ~ Sasha Bostick

She added that after graduating from Rutgers, “I hope to work in the field of Child Advocacy, which will allow me to give back to others the way that Education Aid has given to me.”

Bostick will be awarded $5,000 to pay for on-campus day care, textbooks, and school supplies for the 2012 Spring and Summer semesters.

Education Aid, Inc. is thrilled to be able to prevent a student from leaving school and enabling her to complete her degree.  “This type of aid is extremely limited and desperately needed by so many students,” said Karyn Balfour, the Founder and CEO of Education Aid.  “There are many costs, other than tuition, associated with earning your degree that typical financial aid packages do not cover,” said Balfour.  Without any financial support to help pay for these expenses, students are forced to work and go to school at the same time.  “When students are unable to pay for basic living expenses, they are put in a position where they need to choose between school and work.  Unfortunately, too many times they end up dropping out,” Balfour said.

About Education Aid, Inc.

It is the mission of Education Aid to change the lives of students around the country by providing them with the financial support they need to complete their education.  This is done through the Support a Student Scholarship Program. Participants of this Program will have payments made on their behalf for non-tuition related expenses that are not being covered by their current financial aid amounts.  Many economically disadvantaged students do not receive enough financial support to pay for such expenses and ultimately end up dropping out of school.  This Program was created to identify these students and provide them with the financial support necessary to enable them to complete their degrees.  You can read more about Education Aid at:   www.educationaid.org.

Brian Stoffel from the Motley Fool recently wrote an article indicating he may have been totally wrong in his opinions relating to the for profit education industry.

I spent the better part of my first year at the Fool raging against the for-profit education community. And it was for good reason: Enrollment is dropping, they get too much money from the government, and students are defaulting on their loans at alarming rates.

But after watching a recent speech by innovation guru Clayton Christensen, I’m starting to wonder if I am reading the situation completely wrong.

1. Competing against non-consumption
Christensen says that most innovation comes from companies that are able to bring products to people that otherwise would have no access to them…

2. Using different metrics
A typical college or university focuses on the quality of the research being conducted by faculty as a preeminent metric for value and worth that a college has. While that might seem great, it doesn’t do much to ensure that students are actually being taught…

3. New customers will be enticed into the system
With the cost of sending a child to college sky-rocketing, more and more students may look at online schools as a viable alternative…

Link to complete article

ForProfitEDU would like to extend an exclusive invitation to you to attend The Capital Roundtable’s conference on Private Equity Investing in For-Profit Education Companies, being held on Thursday, January 12 in New York City.

As a partner, we have the privilege to put your name on our VIP list, allowing you to register for a special rate of $995 — $400 off the standard registration price.

This day-long conference is being chaired by Chris Hoehn-Saric, Senior Managing Director at Sterling Partners, and features 20 experts.

For registration or inquiries, just call Anna Fagan at 212-832-7300 ext. 0, or email her at afagan@capitalroundtable.com. Please be sure to mention our name”ForProfitEDU.com”.

For more details, click link below:
http://capitalroundtable.com/masterclass/Capital-Roundtable-For-Profit-Education-Private-Equity-Conference-2012.html

I hope to see you on January 12 for what promises to be a great day.

Have a Wonderful Holiday!

P.S. Since we expect this conference to attract a strong attendance, please register as soon as possible to reserve your seat.

Shares of Career Education Corp plunged 42 percent to their lowest in more than 10 years on Wednesday, a day after its chief executive resigned amid findings of improper placement practices, and increased accreditation risks.

The company also reported disappointing quarterly results 10 days ahead of schedule and said the decline in new student sign-ups will not improve in the near term.

At least two brokerages downgraded the stock to their lowest rating citing too many near-term risks.

FORCED EXIT?

Though the company did not tie the placement discrepancies to McCullough’s departure, analysts say he was kicked out for that very issue.

“The compliance issues were probably the main driver behind the CEO resignation,” analyst Dobell said. “An issue with compliance and honesty, particularly given McCullough’s background, was probably more than the board was willing to tolerate and more than McCullough was willing to stand for.”

McCullough was well respected and credited for cleaning up Career Education’s reputation and streamlining its operations, according to Robert W Baird analyst Amy Junker.

Interesting article from University Ventures Fund:

If you’ve seen Moneyball, the new baseball film about the unlikely success of the Oakland A’s and their out-of-the-box-thinking General Manager Billy Beane, you may have already drawn parallels to the current state of higher education. If not, we’re pleased to do it for you!

Like baseball ten years ago, higher education is focused on what’s easy to measure. For baseball it may have been body parts, batting average and the number on the radar gun. For higher education, it’s the 3Rs: research, rankings and real estate. Each of these areas is easily quantified or judged: research citations or number of publications in Nature and Science; U.S. News ranking (or colleges choose from a plethora of new entrants to the ranking game, including the international ranking by Shanghai Jiao Tong University); and in terms of real estate, how much has been spent on a new building and how stately, innovative and generally impressive it appears.

Unfortunately, the 3Rs correlate about as closely to student learning and student outcomes as batting average or fastball velocity, which is to say, not at all. Buildings are the “ugly girlfriend” of higher education.

Universities that continue to focus on the 3Rs in the wake of the seismic shifts currently roiling higher education (state budget cuts, increased sticker shock, technology-based learning) are either not serious about improving student learning and student outcomes, or they’re like the baseball fan who has lost her car keys in the stadium parking lot at night: Where does she look for them? Not where she lost them, but under the light because that’s where she can see.

To read the entire article: http://universityventuresfund.com/publications.php?title=moneycollege-where-is-the-billy-beane-of-higher-education

After many discussions with some of the top aggregators & lead providers it became clear that most noted a lack in demand by the major schools.  This softness in demand seems to be continuing from the first 8 months of the year by the major EDU players. Not all lead providers indicating lack of demand, a select few of the highest quality providers tell us that the demand for their leads (even at the higher prices) continues to be strong.

Vendors have noted schools being slow to test new campaigns, delays in providing campaign approvals, and restrictions pertaining to taking on new partners/affiliates.

For most schools the demand for leads softened last year and has continued thus far this year.  Many site internal changes, program changes, more emphasis on direct acquisition, branding compliance fears as well as internal admissions process changes.

Last week we spent some time on the phone with a well-known industry short fund.  We discussed the industry as a whole, as well as specific issues facing the industry which were behind their premise that shorting the industry was a good play for the next few years. Topics such as gainful employment, new compensation rules, default rates and the power of non-profit brands extending into the online education were the main points.  Gainful employment in conjunction with 90/10 is in our opinion a biased illogical political move to hinder the growth of one industry segment for profit schools to the benefit of another nonprofit schools.  If the rule is sound & logical, why wouldn’t it

be industry wide, the answer is clear, it’s not a well thought out rule.  If the traditional colleges had to live within gainful employment you would see far fewer lawyers, doctors, economists, political scientists (maybe that’s a good thing) philosophers, literary scholars, teachers, artists, theorists etc.  Who’s going to fill the entry level positions?  Aren’t they stepping stones?  We guess they will be filled by graduates of traditional colleges with English, Liberal Arts & Art history degrees whose $200,000+ education clearly provided them with such a solid and relevant foundation.  Default rates, well they need to be managed, schools need to ensure that the engagement & value their student receive from the education provided them is compelling.  We need to utilize assessment to make sure students enter program they have real interest and a likelihood of success in.  And we need to screen for and provide the remedial assistance necessary for students to be able to be successful in their education.  Will the industry be able to manage them successfully, YES.  As for the value of brands, this is a topic which has been discussed for many years.

We all know a brand is valuable.  We all know having a brand is a huge advantage and can significantly reduce the marketing costs of student recruitment.  But the big caveat is “can”.  Most traditional colleges significantly lack the admissions infrastructure and wiliness to adapt as necessary to be competitive to succeed in the fast paced world of online  education.  The partnerships between traditional colleges and for profit enterprises have proven that they can work and achieve fast growth, but those are still few in number.  The real questions is when will we see an influx of these partnerships, and how much of an effect will they have on the for-profit EDU industry>

Education Sector has created such a measure, the “borrowing to credential ratio.”For each college, we have taken newly available U.S. Department of Education data showing the total amount of money borrowed by undergraduates and divided that sum by the total number of degrees awarded.

The results are revealing:

• Nationwide, the overall borrowing to credential ratio has risen sharply in recent years.

• Certain segments of the higher education industry—in particular, for-profitcolleges—are racking up far more student debt per degree than others.

• State policies matter a great deal, with seemingly similar public university systems achieving widely varying results for students.

• Among elite colleges and universities, some are making good on their pledgeto help low- and middle-income students graduate without major financialburdens while others are riding a wave of student debt to fame and fortune.

Keep in mind that this formula does not take into account the enrollment growth and thus lack of time for those new students to graduate, thus in many of the for profits case their number are artificially high as if they added 5000-35000 new students their numbers are significantly elevated due to their newness and do not reflect actuals.  This is a decent indicator for those schools with consistent flat enrollments

but not for those with rapidly changing enrollments.  Thus, those schools with declining enrollments may show better that actual results while those with enrollment growth will show higher inaccurate debt amounts.

 click here to viewreport: http://www.educationsector.org/sites/default/files/publications/Debt%20to%20Degree%20CYCT_RELEASE.pdf

With all that’s going on with regards to compliance and schools taking more and more time to be selective in who they work with, will aggregators eventually give in to transparency?  This topic is one of many heated discussions.  I have been to multiple edu marketing  panels with the who’s who of the major edu aggregators and it seems to be split.  Some of them say that if forced to they will come around and identify all of their sources, others however refuse to and say they will never disclose every source for their leads.  They believe their lead quality speaks for itself and don’t believe transparency is necessary.   Well these firmare very protective of their sources and they do not want to be open for cannibalization, but if there is some type of vendor protection why can’t there be complete transparency.  Some believe its because of the use of call center generated leads which continue to be tossed into the pile of Internet generated leads for many of the lead providers both at the top and bottom of the food chain.  I think schools have the right to know where the leads are comming from PROVIDED they protect the lead sources from their vendors, non-circumvention, non-disclosure etc should help provide this protection.  Many of the most astute schools will agree to this in order to get the transparency they want.  What do you think?