How Beyond Capital Ventures is Making a Transformative Impact on Emerging MarketsNovember 28, 2023 Blog
Voices of Impact is a continuing series from Tyton Partners that invites impact companies to shed light on…
Founder’s Five is a continuing series from Tyton Partners that invites education company founders to shed light on their own success and illuminate the landscape for other education entrepreneurs and investors by answering five basic questions.
Darren Catalano started his career in higher education at the University of Maryland Global Campus in 2011 as an AVP in Institutional Effectiveness before being promoted to Vice President and establishing the Office of Analytics. The team spun out of the University System of Maryland (USM) in late 2015 as a stand-alone company with funding from the USM Board of Regents and recapitalized in 2019, now with Pamlico Capital as their lead investor (Tyton Partners represented HelioCampus in their process.)
Today, HelioCampus works with more than 150 higher education institutions to help them achieve their mission in a measurable and sustainable way. Their solutions provide ongoing insights into academic, administrative, and financial performance. Through data analytics, the assessment of student learning, and financial planning, they work with institutions to empower decision making at all levels of the institution. Their roots in higher education allow them to offer an authentic perspective on the unique challenges and opportunities facing campus leadership today.
Our roots are in helping the University of Maryland Global Campus navigate through a period of unprecedented enrollment volatility that called into question the viability of the institution. We had seen large declines over a three-year period. Enrollments dropped 20% from 100,000 students to 80,000 students, which is impactful for a tuition revenue dependent institution.
We’re fortunate that we had a leadership team at UMGC that believed in the data, and really used the data to navigate through its challenges. And we had real success. We helped the university move from a large operating deficit to a significant operating surplus within three years. And we did that by focusing on three main areas: stabilizing new enrollments by focusing on student recruitment, improving student success, and restructuring our costs. We had to focus on our cost structure on both the administrative and the academic side, not only to align costs with revenues, but also to find monies to invest in the things that would drive the future of the institution.
The Maryland Board of Regents took note of what we’d accomplished and the impact that we’d had at the institution. They thought that what we’d built was more valuable than just a team at a single institution. So, they approved a plan to spin us off into a separate company that’s now HelioCampus.
We have no illusions of grandeur. The way that we think about our businesses is to focus on the activities that help institutions continue to be successful and sustainable. We are focused on institutional effectiveness and integrated planning.
First, we help institutions create an underlying data analytics capability. You need to organize your data across the student lifecycle. You need to have the university financial data and the student learning data all in one place. That gives you the ability to do deep and sophisticated analysis.
But once you have that set up, there are three main areas that we look at in helping institutions focus: 1) understanding enrollment management, 2) driving student success, and 3) evaluating your academic portfolio. We help institutions develop enrollment forecasts and yielding models, we help to refine their financial aid leveraging policies and we complete deep analyses to inform student retention strategies. From an academic perspective, we help institutions understand which programs are driving demand and degree completion and what are the programs of the future that need to be built? What are the financial heuristics of your existing programs? And do you have enough programs that are generating contribution margin to offset the ones that don’t but may be closely tied to mission. It’s this focus on your academic program reviews from a portfolio perspective, that you’re driving new enrollment, that you’re appropriately focused on student success, and that you are being good fiduciaries in managing your academic programs.
The other area closely tied to this is a focus on student learning outcomes — the main mission of the institution. Are students learning what we say they’re learning, and are they getting the skills that are going to lead to the career opportunities and mobility that is promised from higher education? We focus on student learning outcomes assessment, badging and credentialing, and creating a skills-based transcript (CLR).
And then lastly, we focus on administrative program reviews. We help institutions with benchmarking their labor costs, and financial planning — helping them create a multi-year financial models to understand the impact of different scenarios. To answer the question of what happens if enrollments drop 10% over the next three years? What happens if state appropriations are more volatile than we expect? Can we withstand changes to the non-operating revenues?
But it’s a very pragmatic focus. I don’t think we’re a company that has come into this and said, we’re going to change the world. We’re just helping. Our hope is to partner with institutions to help them be successful and sustainable. And I think we’ve made an impact in in different areas at different institutions, for sure.
The biggest lesson that I’ve learned since starting HelioCampus is that things are never as good or as bad as they seem. If everything seems too good, you should be suspicious. And you should be asking a lot of questions. As an entrepreneur you should always be looking around the corner and seeing what’s coming. And if there’s a sentiment that all’s well, it means we’re not looking hard enough. Likewise, you know, if it seems like Rome is burning, that’s probably not true, either. There are likely a couple of acute items or areas that need attention and need to be addressed. In building our business my experience has been that it’s two steps forward, one step back. It’s about making progress and constantly iterating and improving. If you’re moving two steps forward and one step back, you just need to take a lot of steps.
I’m not sure this is a non-intuitive insight, but I’ve learned first-hand at Maryland and now working with our client institutions that there is never a silver bullet.
I think that there is some sentiment, often among tech companies, that there is some sort of silver bullet. And my experience at HelioCampus is that there’s never one big thing that needs to change; it takes 10 little things to work together to make a big impact.”Darren Catalano
When we started in the analytics business we would meet with potential clients and there would be some perspective that we’re going to deploy predictive analytics and that’s going to solve all their Student Success problems. And maybe we were bad at sales, but our answer was always, “No, it’s not. This is just one arrow in the quiver of a bigger, broader set of initiatives that need to happen at the institution to improve your retention and graduation rates.” If someone’s selling you big gains in a short amount of time, it’s probably not true. I hate to say it, but whether it be student success, institutional effectiveness, or running an EdTech company, it’s about hard work. It’s about making steady, incremental gains year over year, making smart decisions, and investing in the right areas.
And whether you are prioritizing initiatives for student success, or you’re putting together your strategy as an EdTech company I think there tends to be a fallacy to make one big bet. My perspective is, make 20 small bets. And that’s the better way to do it. I’m all for moonshots, but the most successful moonshots didn’t happen overnight, they happened with a lot of research, a lot of iteration, a lot of practice, and then they took their moonshot. Little gains make a big impact.
I’m a big fan of EdTech. I’ve worked across many different industries, and this is my favorite. Sometimes working in higher education is challenging and frustrating, but it’s also been the most rewarding. Running an EdTech company merges my great interest in business strategy, along with a great mission. And so, I have a lot of respect for all my peers in EdTech. I’ve always admired Slate. They have a fanatical user base and they’ve really homed in on the needs of their users. I’m also a big fan of CampusLogic. Its focus on student financial successes is a great mission and I’ve just always gravitated towards the work that they’re doing. A third one is Lightcast, which is focused on jobs data because that’s the missing link, and what broadly needs to happen at scale in higher education. How do you inform curriculum with the skills necessary for employers who are hiring for these jobs? Right now, I don’t think there’s a great connection between the skills and jobs of the future back to curriculum in academic programs. I think there is a great need and desire to merge these things together.
That’s ultimately where I think higher ed needs to go. How do you align these course learning outcomes and institutional learning objectives through the lens of skills? And then map them to employment? How do you provide the students with the evidence for them to articulate the skills that they’ve learned and ultimately match that to careers? You’ve learned these skills, these skills have prepared you for these occupations, these occupations have these jobs, and then going a step further and just connecting the graduate with the employer. I think there are a lot of people thinking in this direction. If it was easy, it would have already happened. It’s not, so this is the work to be done.