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University of Phoenix founder dies, leaving complex legacy

Published: Thursday, Aug. 28 2014 5:45 a.m. MDT

Updated: Friday, Aug. 29 2014 7:40 a.m. MDT

This undated photo provided by the Apollo Education Group shows John G. Sperling, founder of the Univertsity Of Phoenix. Sperling, 93, a billionaire, died Friday, Aug. 22, 2014, at a hospital near San Francisco, according to a statement from Apollo Education Group, the parent company of the University of Phoenix.(AP Photo/Apollo Education Group)

AP

The University of Phoenix lost its founder last week at a moment when some wonder if the world's biggest for-profit college system is losing its edge. John G. Sperling died in Marin County on Friday at 93, leaving a multi-billion-dollar company and a complex legacy behind.

Sperling founded the Apollo Education Group and its flagship University of Phoenix in 1976, the first major player in what has become the controversial market of for-profit higher education, aimed at older, nontraditional students whose work schedules would not allow a traditional college schedule.

UOPX and its imitators have many detractors. Critics argue that they suck students into ill-advised programs that they can ill-afford, saddling them with debt or dubious degrees.

The pressure to keep enrollment numbers up leads to sketchy recruitment of vulnerable students, says Robert F. Muth, a former Marine who works with the University of San Diego’s Veterans Legal Clinic.

“You have high pressure placed on recruiters to enroll a set number of students,” Muth said. “I think it’s inevitable when recruiters have to hit those targets that they will often say whatever has to be said to get a student enrolled.”

During the first decade of the new century, enrollment at Sperling’s Apollo Education Group climbed sharply, from 125,000 students in 2001 to 471,000 in 2010.

But Sperling’s brainchild also has its fans, including many students who found exactly what they needed there in a form not offered by not-for-profit colleges.

A critical niche

It’s no coincidence that Sperling hatched the idea for the University of Phoenix when he was a professor at San Jose State University, a commuter school disproportionately serving nontraditional students. SJSU should have been keenly attuned to the need for flexible classes for working students, but he found little interest in innovating, Sterling writes in his 2000 autobiography, "Rebel with a Cause."

Sperling started his for-profit answer in California, but soon moved to Arizona, attracted by its less aggressive regulations, he writes. Tapping unmet demand, he found legions of students who wanted a degree that gave them credit for work experience and offered night classes on a rolling schedule that could be completed in weeks, not months.

One of those was Mark McKay, now a senior technology manager at General Electric in Huntsville, Alabama. McKay earned both a bachelor’s and an MBA through the University of Phoenix, allowing him to climb the ladder at one company and move laterally into middle management with one of the world’s largest corporations, with substantial salary gains.

Out of high school, McKay turned down a college scholarship to work on a cruise ship. When he finally got a real job at the age of 24, it was grinding precision lenses at Coherent, an optics manufacturer in Auburn, California.

McKay rose to line supervisor and then into a project planner position, but then he hit the credentials wall. “They didn’t send signals,” McKay said. “They said it flat out: I had to have that piece of paper to break through.”

Only the Apollo’s University of Phoenix offered McKay exactly what he needed. Over four years he worked days and studied nights. In four years, he graduated, got his promotion and his career prospered.

“At the time, I looked at Sacramento State University, but they didn’t offer anything that allowed me to move quickly on flexible schedule,” McKay said.

And despite admittedly high tuition, the University of Phoenix approach worked for him. His company heavily subsidized the tuition, and the total remaining debt was well worth it to him. “The income increase substantially more than paid for it,” he says. “It’s almost exponential.”

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