For more than a decade, Graham Holdings Co., the former Washington Post Co., relied on American students at its Kaplan colleges to fuel growth. With for-profit education under siege in the U.S., the future of the rapidly transforming company may lie abroad.
Matthew Kapral, a student at Education Management Corp. ’s Art Institute of Pittsburgh, was walking to class in July when a school representative sat him in front of a computer and coached him on a letter opposing limits on federal student aid to for-profit colleges.
Strayer Education Inc. , a chain of for-profit colleges that receives three-quarters of its revenue from U.S. taxpayers, paid Chairman and Chief Executive Officer Robert Silberman $41.9 million last year. That’s 26 times the compensation of the highest-paid president of a traditional university.
U.S. higher-education stocks fell 48 percent from April to October last year as the federal government proposed tighter regulation and short sellers led by hedge-fund manager Steve Eisman targeted for-profit colleges.
Investor bets against the stock of the Washington Post Co. have more than tripled over the past year, as the government investigated the for-profit education business and the company’s earnings dropped.
Mark Zuckerberg’s majority control over Facebook Inc. puts too much power in the hands of one person and may deter potential investors in the company’s initial public offering, corporate-governance experts said.