Colleges Team Up to Survive

Last week, NY Times reporter Jon Marcus wrote an article about small colleges teaming up to survive by offering shared online courses. Mr. Marcus described how Adrian College, Westmont CollegeRochester University, Emmaus Bible College, and Eureka College among others have increased the number of degrees, minors, and certificates they offer through course sharing.

Mr. Marcus noted that hundreds of colleges have joined course sharing consortiums since the Council of Independent Colleges announced its course sharing platform in late 2018. The CIC consortium now has 303 members. The Lower Cost Models for Independent Colleges Consortium has 135 members. The Southern Regional Education Board (SREB) consortium one of several that is powered by Acadeum has 14 members.

Acadeum is referenced as one of the largest tech companies operating a course sharing platform. Mr. Marcus wrote that Acadeum powers the CIC consortium as well as the SREB and DigiTex consortiums. Other tech companies mentioned by Mr. Marcus include Unmudl who is “developing technology” to assist colleges with course sharing, Rize Education, and Quottly.

Money is the big reason why small colleges are sharing courses. Mr. Marcus notes that Adrian College enrolled 51 students this year who would otherwise not come if they had not added majors and minors through course sharing. Those incremental students will generate $8 million in revenues over four years. When you look at the fixed cost operating budget of many small residential colleges, a large percentage of those incremental revenues after subtracting the fees to the sharing platform will flow to the bottom-line cash flow from operations and provide funding for other initiatives. Mr. Marcus notes that developing new academic programs can cost up to $2.2 million according to EAB. Clearly, these incremental revenues from students enrolling who would not have previously attended makes a huge difference for small colleges. According to Mr. Marcus, Emmaus Bible College only has 193 students enrolled.

I’ve had the honor and pleasure of meeting with several of the leaders of the Acadeum team which is based in Austin. One item that Acadeum’s team touts as a benefit of utilizing their platform is increased student persistence. While I’ve never met with Rize or Quottly, their websites tout that benefit as well. Increased persistence occurs because the smaller colleges are offering a degree like business administration or supply chain management that they didn’t previously offer. It could also occur because a student dropped a course in the middle of the semester and fell below the minimum standard required to maintain their financial aid. With Acadeum, there are many different start dates for courses offered by its 400+ members. An astute academic advisor at a member college can find a replacement course with a start date after the registration date for their institution and keep the student enrolled. The Acadeum website specifically cites its sharing platform as enabling students to be able to maintain their progress toward graduation, supporting student athletes by navigating schedule demands and setbacks, and helping students regain academic standing and getting back on track with flexible course options.

While I haven’t tried to find a way to calculate the impact, it appears to me that incremental enrollments in a market where overall higher education enrollments are declining are a smaller piece of the revenue bucket than increasing student retention.

The big difference between course sharing platforms and OPMs (online program managers) is that the institutions maintain responsibility for marketing their school and programs, and the student enters as a traditional student. This saves the institution an incredible amount of money since OPM’s charge anywhere from 35 percent to 65 percent of revenues from the online courses and programs that they manage. The fees discussed by Mr. Marcus range from a platform fee of $2,500 to $20,000 per year and 25 percent of revenues from the school that teaches the course. It’s possible that there are lower fees but regardless, these costs are lower than OPMs and depending on how many courses are shared, could be substantially lower.

One cautionary piece of advice for small colleges that use this is that there have been regulations in the past that regulate the percentage of courses that can be taught by an outside partner before the college’s accreditor has to grant approval. I believe the threshold ranges from 25 percent to 50 percent. If it looks like you’re getting close to that threshold of courses taught by a single partner, you should check. I think most colleges should easily be able to keep it under 25 percent for a bachelor’s degree.

From my perspective, the pros far outweigh the cons for course sharing. A benefit that I did not discuss is dual enrollment where high school students take college courses for credit while they are in high school. I think these course sharing consortiums could handle that as well if they don’t already. As usual, I look forward to your thoughts and comments.

Subjects of Interest


Higher Education

Independent Schools


Student Persistence