The future of for-profit institutions remains relatively uncertain, despite the fact that online colleges seem to be at the peak of their existence. As a result, while investing in a for-profit school may seem like the smart thing to do in an uncertain economy, many schools are wary of initial public offerings of stock. However, investing in a for-profit school has been the saving grace for many traditional universities who were struggling to stay afloat.
Grand Canyon University, a previously nonprofit Christian liberal arts college founded in 1949, found itself in this dire predicament in 2003. Having no financial outlet to turn to, the school sold its rights to California-based Significant Education, L.L.C., effectively transforming it into the country’s first for-profit Christian college. This investment caused the school to undergo a facelift of sorts, receiving an $150 million makeover that included a new brick promenade, Olympic-size swimming pool, and a café for students. In addition to all of this, the school currently ranks among the top in online education and has continued to thrive despite the bad economic outlook for many traditional colleges.
Significant Education (now called Grand Canyon Education Inc.) registered its stock in 2008 because of this extensive transformation from a traditional nonprofit “brick-and-mortar” college to an online college. The company registered this stock in attempts to make a profit of $230 million, although they saw little fluctuation when it was first registered. However, in late 2008, the school managed to hold onto its position despite the plunge of many other stocks, demonstrating the strong position of online education despite a bad economy.
While it remains relatively unclear why there is a sudden draw to online universities, most economists have speculated that working adults have flocked to schools during the recession. The stocks alone have demonstrated this trend in for-profit schools and have indicated their lasting power to many investors. Grand Canyon Education did not reach its expected growth of $230 million, but ended 2008 with $130 million, a sizeable advancement to say the least, especially for a school whose future was uncertain only 7 years ago. The population of the school alone has doubled since it expanded into the online education realm. The school remains tiny compared to the behemoth institution of the University of Phoenix, but has yet to demonstrate its true potential in the online education industry. The school ended 2008 with a promising outlook in its economic future, promising even higher net returns as the school continues to prosper, seeing promising increases throughout 2009.
For-profit institutions have literally saved the education industry of our country, with major corporations like University of Phoenix ending the year with profits close to $3 billion. Most other online colleges continue to vie for this top position, and as they do so they continue to create jobs for potential staff and faculty, and offer a new educational opportunity for millions of students each year.
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