UV Letter - Volume II, #2
Thirty years ago America was an economic basket case. The official unemployment rate in 1982 exceeded 10%, but apples-to-apples unemployment (counting it the way we do today) was over 16%. Inflation was north of 6% and the prime interest rate reached 21.5% in June 1982. Things weren’t much better in the UK where deindustrialization had resulted in unemployment over 20% in many regions, and where the ‘workshop of the world’ became a net importer of goods for the first time ever.
It’s always darkest before the dawn. So few recognized we were on the verge of a revolution in information technology that would drive productivity increases across almost all industries and create new ones over the next two decades.
If there’s any consensus at all in today’s debate about how to rekindle economic growth, it’s the importance of education, and particularly higher education. We need more educated workers to innovate and increase productivity.
Not coincidentally, the largest industry that has not seen much in the way of productivity improvements since 1982 is education. All but a handful of the 170 million students currently enrolled at tertiary institutions around the world are learning the way their parents and grandparents learned (often learning virtually the same curriculum). The ‘sage on a stage’ model remains unchanged, and the well over $1 trillion in annual spending on higher education continues to be directed to the same functions.
And so the stage (if not the sage) is set for the world to focus on higher education as it never has before, and for dramatic changes in programs, delivery models, costs and learning outcomes. While the private sector will play a key role in this next revolution, it cannot succeed alone. Traditional universities and colleges – public and private -- will be the crucibles of change, in partnership with entrepreneurs and companies. The resulting models – partnerships, hybrids, service providers – will transform higher education, enhance productivity and foster economic growth.
Today we are pleased to announce University Ventures (UV). UV is an investment fund with over $100M in committed capital focused exclusively on the global higher education sector. UV pursues a differentiated strategy of innovation from within – partnering with (rather than competing against) traditional institutions.
By partnering with top-tier universities and colleges, and then strategically directing private capital to develop programs of exceptional quality that address major economic and social needs, UV expects to set new standards for student outcomes. Specifically, UV is committed to establishing data-driven programs that ensure superior student outcomes, as well as to leveraging technology to lower cost while improving access. All UV programs are student-centric, focused on student retention and completion.
UV is led by four principals with 50+ years collective experience as entrepreneurs, investors and leaders in higher education, and with a track record of establishing some of higher education’s largest and most successful organizations. With the greatest respect for the values, quality and traditions of academic institutions, UV aims to play a formative and constructive role in the private sector's increasing involvement in the future of Higher Education. UV partnerships will not only be constructive for students, who can expect a strong return on their investment, but also for traditional universities and colleges; UV partnerships will strengthen institutions, providing them with resources and a more sustainable path to achieving their missions.
UV is backed by some of the global education sector’s most successful and influential strategic and financial investors. Our limited partners aim to realize market-leading returns while playing a positive and sustainable role in the transformation of higher education. Our carefully selected investor base comprises a broad spectrum of stakeholders in higher education across the US, Europe and Asia. All investors are aligned with UV’s mission of doing well by doing good, and are committed to prioritizing student outcomes in every investment.
Our limited partners include leading organizations such as:
The world’s most international media and services company, with more than 100,000 employees across 60 different nations and $20bn in annual revenue.
Created in March 1996, UTIMCO is the first external investment corporation formed by a public university system and oversees investments for The University of Texas and Texas A&M Systems.
UTIMCO is consistently among the top five higher education endowments in the U.S., alongside Harvard, Yale, Princeton and Stanford.
Every day we wake up and live our dream of helping higher education innovate from within. We believe the results will cascade across the broader global economy.
Thank you for allowing us to share our thoughts with you in these letters. We look forward to many years of educational engagement!
University Ventures (UV) is the premier investment firm focused exclusively on the global higher
education sector. UV pursues a differentiated strategy of ‘innovation from within’. By partnering with
top-tier universities and colleges, and then strategically directing private capital to develop programs of
exceptional quality that address major economic and social needs, UV expects to set new standards for
student outcomes and advance the development of the next generation of colleges and universities on a