Private universities – the future of doctor and nurse education?
Can you make a successful business training doctors and nurses in private institutions – and charging for the privilege? Who will be the largest trainers, globally, in the coming years? As far as degree courses are concerned, it’s likely to be a private university network.
A network like Laureate, perhaps, the US-based higher education network with a large and growing global footprint. It has a broad portfolio of programmes, and offers degrees in dentistry, medicine, nursing, physiotherapy, and psychology – with around 200,000 students studying in those fields.
The Baltimore-based company operates largely outside the United States and is the first “public benefit” corporation to go public. Founded in 1999, the group raised US$457m of net proceeds with a February IPO, and its public benefit status means it has to balance profits for its shareholders with making a positive impact on society. But it is also making money.
And the market? We understand it’s largely the middle class in emerging markets. There’s a demand for this kind of training, insufficient supply in by public sector, and people with money (or willing to borrow it) to be educated.
One source tells us that many, if not most, of the students have private loans while in places like Brazil or Mexico, government assistance is available. In comparatively wealthier countries like Spain, there’s a higher percentage of private pay.
A new, flourishing market in international education for the medical profession is springing up – and it’s clientele is mobile and there are established routes which have sprung up. Americans head to the Carribean. People in Latam and South Africa head to Cuba. We are told that Greeks and Serbs head to Bulgaria for medical education.
Is this the future of education and is there money to be made here? We’ll let the figures do the talking. Revenue in the second quarter of 2017, announced last month, was $1,277m, a 4% increase, while adjusted EBITDA was $341.9 million in the second quarter of 2017, up 11% and the EBITDA margin is a highly respectable 26.8%.
The truth is that the public sector in Europe prefers to steal doctors from poor countries than to train their own. And what is the point of a poor country paying for doctors who then flee? Almost uniquely in healthcare services, this strikes us an area where the long-term solution, massively increased training capacity, will have to come from the private sector!
We would welcome your thoughts on this story. Email your views to David Farbrother or call 0207 183 3779.
