A Bain & Company analysis of nearly 1,700 public and private nonprofit colleges finds that one-third of the institutions have been on an “unsustainable financial path” in recent years, and an additional 28% are “at risk of slipping into an unsustainable condition.” Bain and Sterling Partners, a private-equity firm, collaborated on the project. They have published their findings on a publicly available interactive website that allows users to type in the name of a college and see where it falls on the analysts’ nine-part matrix.
Bain and Sterling maintain the analysis sends a sobering signal, even if some might see the findings as alarmist or self-serving. “Financial statements have gotten significantly weaker in a very short period of time,” says Tom Dretler, an executive in residence at Sterling, a firm that is a major investor in Laureate Education and other educational companies.