Scaling to $10 Million from Kentucky: Steve Huey, CEO of Capture Higher Ed (Part 3)

Sramana Mitra: The primary business is, essentially, lead generation for colleges? Is that what you’re saying?

Steve Huey: Yes, our primary business is lead generation but for not-for-profit schools. It’s a very important distinction. There are around 3,300 not-for-profit colleges in the United States.

Sramana Mitra: Let’s start there. What is the difference between leads for not-for-profit schools versus for-profit schools since it’s such a big distinction?

Steve Huey: For-profit schools started out as trade schools. A lot of the for-profit schools you see are for truck driving, typing, etc. There are a number of for-profit schools where you can learn nursing or earn business degrees. They’re in the minority. The schools that are for-profit typically target more mature, non-traditional college students. Non-traditional would mean students not immediately graduating from high school but have graduated from high school several years ago and are looking to go back to school or go to school for the first time after they’ve started a career. In fact, a lot of the for profit schools are called career colleges.

At Learning House, we work very hard to recruit those students for our customers whom we help to do online programs. The not-for-profit, traditional schools typically go and recruit high school sophomores, juniors, and seniors. They’re looking for students to have a more traditional college experience where students would come, live in the dorm, eat in the cafeteria. That, for most colleges in the United States, is their bread-and-butter student.

Sramana Mitra: Let’s get back to how you started the company. What was going on and why did you choose to work on this particular area?

Steve Huey: We saw that there was a huge need. We also looked at the competition in the field. There were already people who were serving this group. Many of these companies were extremely profitable. When we looked at the solutions they were offering, we realized that we had some key insights from working with for-profit and non-traditional students that we can apply to traditional students. We realized that it would potentially make a better product offering.

We formed a new company not affiliated with our current company. We pooled in the main expertise or partners. They were called the Miller Cook Associates, which was an involvement management consulting firm. Between their knowledge of traditional students and our knowledge of non-traditional students and that of technology, we created our first product offering.

Sramana Mitra: What about customers? Who were your original customers?

Steve Huey: Millers Cook Associates had a dozen or more schools that they work with. We used those contacts to find the first six or seven clients that we used for Capture. Higher Ed is a very conservative industry. Many analysts that cover higher education will tell you that most educational technology companies die before they get to their first client. They move slowly. Having relationships with over a hundred schools where they trusted us via Learning House and Miller Cook Associates was vital in getting our early clients. In the first year, we attracted six clients, which generated revenues just below a million dollars for us. That was enough momentum to get us started.

This segment is part 3 in the series : Scaling to $10 Million from Kentucky: Steve Huey, CEO of Capture Higher Ed
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