AFR Report: Private Equity’s Failing Grade in the For-Profit College Industry


March 27, 2018


Carter Dougherty,, (202) 869-0397

New Report Documents Impact of Private Equity on For-Profit Education Industry

A new report¬†from Americans for Financial Reform and the Private Equity Stakeholder Project documents how the private equity industry has driven the growth — and abuses — of the for-profit higher education industry.

For more than a decade, private equity firms have helped drive growth in the for-profit college industry in the United States, acquiring and helping to grow chains including the Art Institutes, Argosy University, Walden University, the University of Phoenix, and Ashford University.

As the Trump administration rolls back the greater regulatory scrutiny the for-profit college industry has faced during the last several years, it is private equity that stands to benefit the most, posing continuing dangers to students, taxpayers, and the integrity of the federal financial aid system.

Private equity-owned for profit colleges, like other for profit colleges, are heavily dependent on US Department of Education Title IV funds including federal student loans and grants such as the Pell Grant. On average, Department of Education Title IV funds accounted for around 80% of revenue at private equity-owned for profit colleges.1 For-profit colleges owned by private equity firms drew more than $5 billion in US Department of Education Title IV funds in the academic year ended 20152, and hundreds of millions of dollars more in Post 9/11 GI Bill and US Department of Defense Tuition Assistance funds.

The report contains extensive details on private equity investment in for-profit education, in tabular form.