ATGE 2026 Jefferies Healthcare Services and Technology Conference

Sure. When I joined the company in 2018, we were a diversified conglomerate, as many as 12 different brands and businesses in the portfolio, covering a range of education and training domains. We made the decision to try to rationalize the portfolio, and we had lots of different potential directions to take it, but ultimately decided that the highest value proposition was really doubling down on the legacy healthcare assets that we had in the portfolio. We executed a series of divestitures and one large acquisition. So, a host of assets out of the business, the acquisition of Walden University from the Laureate Education group. That gave us the five institutions that we take to market today, all of which are post-secondary higher education, all of which have a center of gravity in healthcare. We love the positioning. We love the particular programs that we take to market in that domain, and we believe in addition to all of the other attractive attributes, barriers to entry, wide competitive moats, it serves a fantastic public good as well.

Once we rationalize the portfolio and got down to the set of programs and institutions that we thought were attractive, with our four biggest categories being medicine, veterinary medicine, nursing, and social work, we thought the next order of business was proving out that we could operate those assets in a fully integrated, highly efficient way and deliver the kind of consistent results of operations that I think our owners have been seeking. Growth with Purpose was really an operational excellence-focused strategy that was designed to prove that we could be best in class in the five areas where we thought we had the biggest levers of value creation: marketing, enrollment, developing new programs, price optimization, and student persistence. Over that three-year strategy, we excelled at all five. The results were really quite fantastic.

We enjoyed over that three-year period 12 consecutive quarters of enrollment growth across our institutions. We expanded profitability in a really attractive way, and we were able to grow revenue at high single digits over that period as we expanded margins. We think that's earned us the right to think about how we extend the platform from here. At Investor Day, we announced a new three-year strategy that builds on Growth with Purpose, but looks for ways for us to extend the reach of our platform and expand the impact of our institutions.

Yeah. We start from the place that Chamberlain is already the largest nursing school in the country, and one of the most respected by employers. We were at 23 campuses in 16 states. Having proven that we could operate the business effectively with real consistent operational excellence, we thought this was the right time to think about expanding that footprint in a fairly aggressive way. First, we think it's completely responsive to the market demand. The shortage of clinical workforce, particularly nursing, is vast and growing. There are a host of attractive markets that we weren't operating in, at least in a synchronous campus-based model, that we thought would be attractive, and the returns on campus expansion at Chamberlain have always been very attractive. So we announced a plan to open 10 to 15 new campuses over the next several years.

Those campuses, depending on the location and the size of them, involve an outlay of $9 million-$12 million of CapEx, but we've got an EBITDA break even in 24 months after they launch. They grow rapidly. They bring both campus-based and online programs to those markets, and we believe that that's a highly attractive capital allocation move for us, completely responsive to the needs of U.S. healthcare, and continues to cement our position as the leading trainer of nurses in the United States.

Yeah. You're correct. The first three locations have been announced. We're open in Cincinnati. We've announced Salt Lake City, and we've announced Nashville. Very different markets, but one of the things I think they share is there's an undersupply of nursing talent in that market. We look at the existing training landscape for nurses, the overall healthcare infrastructure, the labor market, cost of operating, competitor dynamics, and all three cities, for a variety of reasons, represent really attractive markets for us. They also represent places where we think it's possible to not just be a leading educator in those markets, but also to partner more effectively with healthcare delivery institutions in those markets as well. Nashville is obviously a huge healthcare town, fast-growing town, lots of demand for nursing education, undersupply of seats. So we're excited to be here and looking forward to growing in Nashville.

Sure. To your point, academic partnerships in healthcare are not new. Academic medical centers often have their own programs in nursing and medicine, and we, across our institutions, have partnered with healthcare for many, many years. The difference is that coming out of the pandemic and watching the pandemic expose some of the weaknesses in the public health infrastructure, we thought it was time to think about those partnerships in a larger and much more expansive way. Rather than having partnerships that provided a small, incremental, additional number of nurses to a healthcare delivery system, what if we thought about these as scaled partnerships, and what would it take to realize that scale on both the supply and demand side? We started with SSM, a large Catholic system that operates in four states: Oklahoma, Missouri, Illinois, and Wisconsin. We started with our St. Louis market.

We've had a long-standing presence. In fact, Chamberlain's origins go back to St. Louis. We hypothesized that a combination of scholarships and student support, the ability to do one's clinical training at a respected employer in that market, and a clear pathway into employment post-graduation, would actually allow us to grow the overall pool of aspiring nurses for that market. In the just over a year we've been in this with SSM, that has proven itself out. In fact, we've had so much success in SSM that we've actually raised the enrollment target in that partnership. Following that, we announced a similar partnership with Advocate, which is new. Advocate's the third largest not-for-profit integrated health system in the country. Very exciting partnership with them.

Currently scoped small, as all these are at the outset, but given the geographic reach of Advocate, we're excited to see what we can do with them as well. The thing to remember is that there's no talent shortage in nursing. What there is an opportunity shortage in nursing. 96,000 qualified nursing students were turned away from nursing school last year because of a shortage of seats, not because they didn't have the aptitude or interest to become nurses. We're in the scaled capacity business, and we think that our ability to train these nurses at scale and deliver them at scale to health systems will go a long way towards addressing what I think is one of the chronic pain points in healthcare delivery, which is labor.