College Financial Health and Viability Review: Data tools for leaders, faculty, staff, and students

Welcome back to the June 10, 2025 show, the College Financial Health Show with Matt Hendricks and Gary Stocker. Yet again, sans Matt Hendricks this week. He's flying back from a European vacation with his family. I think even as I record the show this week, Matt will be back next week on June 17th, and we'll have 3 more private colleges that we will review for their financial health and viability. For this week, we're going to take a look at the 4 products, the 4 tools that Matt and I have created, support, and market to give viewers and users a chance to kind of see in one setting each of the tools and how they might be able to use them. So let's start with the first of the 4 apps that I briefly want to show you today. This is the 2025 College Majors Completion It has 64 common diverse set of majors for all public and private colleges in the country, including 2- and 4-year public colleges. And there's a couple different ways to look at this. I've set this up to look at the private colleges in the state of Ohio, and this is by college. And the way to look at this, I have a couple of colleges here. Antioch College lists up. Let's take a look at Wilberforce University, and we take a look and see where they have a large number of majors. and we look to see what that percentage is. So we can see Wilberforce had some decent numbers in Business Administration. This is the percent market share, it's internal market share at that college for each of the years 2020 through 2023. Let's take a look at Ursuline College, a little bit more data, and again some strong numbers at 45 graduates in the 64 majors that we have. And we can see that they are strong in Psychology, strong in Social Work, and like we see in many cases, this also points out those areas where the colleges are not particularly strong areas, maybe where they're trying to be all things to everybody. And they should take a look at whether they need to be in the chemistry business, the marketing business, the mathematics business. Look at the finance college, the same thing. You see where they're doing well, and you see those areas where you might want to ask the question, why am I still in this business? And then we can look at it by major. These are Ohio private colleges. I could add public colleges if I wanted to. And I want to take a look at one— I'm just going to click the bachelor's degrees, and I want to take a look at one major. And we'll start with the one on top. We'll start with accounting. And this is a true market share analysis for all of the colleges, public and private, 4 years, in the state of Ohio that offer 4-year degrees, bachelor's degrees in accounting. I can make this a little bit bigger for you, and we can see who's dominant— Franklin University. We can see who's strong— University of Dayton. We can also see those colleges as I scroll across the top, that are pretty weak in these majors. And again, it begs the question, do we need 30 accounting and related services majors in the state of Ohio, or can some of these be consolidated? We could also track inside of this app the market share changes. And let's grab something more common. We'll stay with accounting here, and we can see which colleges have declining share And this one looks like it's Franklin University. We can see which colleges have— really, none of them are growing much. A little bit here for maybe John Carroll University. But you look at the trends for those colleges. This is a true external market share analysis. We can pick whatever major we want. The second app that I want to show is the 2025 College Viability app. This is the data that started it all back in 2019 when we started looking at ways to share and compare the financial health and viability of private and public colleges. This includes some 2,700+ public 2- and 4-year colleges along with private 4-year nonprofit colleges. And I've set it up for the state of Massachusetts. Again, I'm just— for our purposes, I've got just private 4-year nonprofit selected. I can select any combination of those as appropriate. I can even filter by size as appropriate. I'm not doing that today, but we'll take a look at just two fields. We'll look at 4-year graduation rates for all the private nonprofits in the state of Ohio, and we can see that some are doing well. Hampshire a little bit okay. Wheaton not bad. Franklin College of Engineering doing well. We can also see with colleges that don't even graduate half their students, Dean College, Bay Path University. And again, you can scroll on this list all the way down to see which colleges are graduating a good number of their students, as they are at Worcester Polytechnic, and which are not graduating even half their students, for example, at Suffolk University. And then there's a long list of reports. I'm not going to go through those. I'll scroll quickly through them so you can take a look. Pause the video if you want to look at it more closely. And the last one I want to show you is tuition fees, because this can be an indicator where a college is growing— going in terms of its financial health. And so what I've done here, these are the colleges that have grown their tuition and fee revenue from 2016 to 2023, and that's the last data reported. IPEDS is typically a year and a half behind. The patterns hold, For those that say, well, the data is old, well, I will see the point, but the trends still show whether it's a year short or not. We can see those colleges with good revenue growth. And as I flip this difference, these are the colleges in Ohio that you might want to be concerned about because their tuition and fee revenue have decreased over the last 8 reported years. And even we have programmed into the app the red numbers throughout here indicate a decrease in enrollment from the previous year. For example, Hampshire College is down in, looks like, 6 of the last reported 8 years. And it looks like even Springfield College is down in each of the last 8 reported years. And you can see the patterns across all of the data. And finally, we're gonna look at the 2 products that Matt Hendricks has created in his Perspective Data Science company, at his Perspective Data Science company, the Advanced Compass, the Private College Advanced Financial Compass, and their Strategic Compass. Both of these are now only available for private colleges. Both of these are available for only the private colleges right now. The public college version will be available later this year. And we're looking now at the advanced private college financial compass. The data from this is captured through all of the audited financial statements for every private 4-year nonprofit college in the country. When Matt has developed an AI tool to go and grab the images of all of those audited financial statements, from the Federal Audit Clearinghouse. He captures those data points, converts them to actual data, and that populates his database that serves the purposes for both the Advanced Compass that we're looking at now and the Strategic Compass that we'll look at here in a couple minutes. In addition, he uses a similar kind of approach, but not identical, for the IRS 990 data and of course for some IPEDS data as well. What I've done here is I've grabbed two colleges for the sake of example: Lesley University in Massachusetts and Webster University here in Missouri. First of all, let's explain the lines. The bottom line represents the 25th percentile of all private colleges, about 1,300 in the United States and in the database. The solid line is the median, and the short dashed line is the 75th percentile. The red line is from a set of, of 9 recently closed private colleges. There's a set of private colleges there, you can see where they closed. When they closed. And of course, you don't want to be near the red line for any period of time. Lesley University is the blue line. Webster University is the green line. And again, you really don't need me to tell you what's going on here. You can see which of the colleges is struggling when we're looking at net income margin. Webster has had issues really since 2016, 2017. Lesley has been up and down. They recovered from the pandemic a little bit but even now starting to show some signs of financial weakness in the terms of the context of net income margin. Let's take a look at the endowment. This is the end of the year endowment for both the colleges. Lesley in the blue, Webster University in the green. We're going to look at the raw values now. So you can see that in 2024, the West— the Lesley University had about $185 million in the endowment. Webster University about $67 million. And there's— that's the raw value. You can see how it compares to the to the percentile markings. And we can also look at this in standardized methods, percent per student. And you can see again that Lesley is in much better shape per student. The percent change, and again, we see both of these colleges below that 25th percentile. I'm not gonna show that in today's video, but Matt and I regularly look at the endowment draw, and I know for a fact that Webster University has been too aggressive in drawing down their endowment funds. I'm guessing the same thing has happened at Lesley University to a smaller degree. Let's take a look at two other fields that kind of quickly tell us what's going on. I'm going to look at operating income, operating revenue, and I'm going to look at operating expenses. And again, we'll start by looking at the absolute value. And so we can see the overall downward trend for Lesley, more flat but still a downward trend. I'm sorry, the overall downward trend for Webster University has bumped up a little bit last year, and they can consistently flatter but still downward trend for the folks at Lesley University. Same thing for expenses. We can see that Webster's expenses are— have decreased a little bit but gone up in the last couple years. And to their credit, Lesley University has managed theirs reasonably well over the last 8 years. Let's look at that as percent change again to get a standardized perspective. Look at percent change on both, and we can see that in the context of the 25th percentile, neither college is doing well. Webster has serious issues, especially when you look in the context of the set of 9 recently closed colleges. And, and the only surviving grace for Lesley University is they had some better years in the late teens of this century. And then again, operating expenses, you can compare and contrast. For example, look at Lesley expenses are up about are about flat over the last 8 reported years from 2016 to 2024, and the revenues are down 16%. Not the best match in the world. And the last one I want to show is something that's a really inside baseball kind of number, and this is one I think is a silent indicator of a college in trouble. And this is CapEx to depreciation. When we look at the CapEx to depreciation ratio, we want to see that value above 1. And we can see the value 1 is right across this line right here. And we can see that both colleges started off at or about that. We can see that Lesley has for most part been bouncing around that number. The Webster University trend has been downward utilization. And that indicates in, in my mind, and I think Matt would agree if he were here, they don't have the resources to invest in infrastructure maintenance. And that can be buildings, that can be sidewalks, roofs, dormitories, computer hardware, computer software, all of those kind of things. So now we're looking at the Perspective Data Science Strategic Compass, and we have a demo college that we've used for this. And I just wanna show you what this is all about. And you can see all of the reports that are available, and I'm just gonna demo 3 or 4 of these. And let's start with looking at expense benchmarking. And behind all of these, there's a set of peer colleges, and it is a statistically determined set of peers that MAT uses some statistics, and there are 40 parameters used to match that. You can turn that off and on. There are self-peers that colleges can select. There are local peers, in this case New Jersey, and there are strong financial peers that you can select as well. Let's select all of them for our purposes today, and let's take a look at expense benchmarking for this university. And red suggests over the expected value. So the expected value comes from whatever peer set we talked about before, from either any combination of these peer sets that you want. And we can see that total expenses for Drew University are about $12 million higher than statistically expected. Instruction is about $2 million lower than statistically expected. You can see the pattern all along. This is for functional expenses. You can see the same pattern for national expenses, and it's broken out by different kinds of data points. We can also take a look at this from IRS 990 data. You can see those comparisons as well. And there's some graphics that you can use to show, in this case, Drew University is the red line, our target university, our practice university, and this is the peer set that had been selected. And you can look at all of these reports in the same kind of layout. We can look at, for example, legal fees, and that comes from the IRS 990. Second thing I want to look at is full-time staff. And again, from the peer group, we can see at this, at this demo university, there are 166, expected 253, expected average salary and benefits $105,000— I'm sorry, the actual is $105,000, expected is $80,000. And you can see what the difference is between outliers and expected. And that pattern holds all the way through at different levels. For example, you can see that slightly that this college has a few more management than expected and a few fewer business financial operations folks as expected. Same thing across compensation. Let's take a look at net price. That interests a lot of folks. And again, we can see that for our demo college, and if this were yours, if you purchase this, and I'll get to the pricing here in a minute, you can see what your price is for these family income levels and how it compares, how it would compare to the expected value. What the difference is and the percent difference. Again, you can see how this, this tactical and strategic comparison can be done for your college. And again, pictures— there's the 110. We can look at it for different family groups, and we can see how it compares. Of course, still Drew College is the red, the peer group, as you might imagine, a little bit more consistent than an individual college. And then lastly, I want to show the undergraduate enrollment simulator, and this is a projected— a projection device. And what the folks at PDS and Matt Hendricks have done is they have predicted undergrad enrollment based on past results. And the red line here is what the formula using predicting results is like, just to make sure that the future projections simulation for future values would be accurate. And you can see that the trend is the same. Trend is almost— is very close together. The pattern— the actual value is a little bit higher, but the trend shows validity. How do you use this? You take a look and change— this is a number of first-time students in 2024. This college had 4,600. If we take a look at that and put the number they had for 2018, you can see it impacts the simulator to bring that enrollment down. If we look at the best value they had for first-time applicants in 2011, you can see the opposite trend— the value goes up. You can make adjustments for every one of these parameters to see what your college would need to do to get this enrollment simulator to show a projected increase based on changing this value. And again, the statistics are based on peer groups, and I showed you those peer groups before. So the pricing, the pricing for each of these 4 products: the 2025 College Majors Completion app retails at $799. The 2025 College Viability app for executive analysis retails at $1,500. And there are both student and family versions. There are student and family versions for both the College Majors Completion app and the, and the College Viability app. Those both retail at $39. They have a lot fewer products, a lot fewer reports, and a lot fewer years in those reports. The Advanced Compass retails at $4,500. There are some.edu domain discounts for that. And the Strategic Compass, the last product that I showed you, retails at $19,000. And there's a lot more included than just the software that I showed you today. I will leave links to purchase each of the first 3 products. The Strategic Compass can only be purchased one-off, and I will leave a link on how you can schedule a private demo of the Strategic Compass with me and then move forward as appropriate to purchase that and get it customized for your college. So for Matt Hendricks, this is Gary Stocker. Thanks for making time to watch the June 10th College Financial Health Show will be back next week with 3 private colleges on the show.