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The founder of the big Sylvan Learning Centers franchise chain is revving up another educational venture, this one based in Spokane, that expects within five years to be operating nearly 800 neighborhood tutoring centers nationally and to have annual revenue of about $42 million.
W. Berry Fowler, who retired as chairman of Sylvan Learning Centers in 1987 and later built up another national franchise chain called The Little Gym International Inc., has enlisted Allison Johnson Venture Partners Inc., a Spokane venture-capital firm, to help the Spokane start-up raise equity capital and roll out its aggressive expansion plans.
Called A Thousand Points of Knowledge Inc., the young company plans to offer tutoring for school-aged children through centers located in neighborhoods throughout the country. Though that plan is similar to what Fowler did with Sylvan, he says that this time around he plans to sign up nonprofit organizations to operate the centersrather than sell franchisesand that the training will be offered at below-market rates, broadening the potential market.
He says he believes that nonprofits, such as YMCAs, YWCAs, municipal park and recreation departments, private schools, and the like, will be attracted to the idea as a way to add an additional service for children that also generates revenue. Besides, Fowler says, Those are the ones that already have solid reputations with kids.
The new company opened such a center in May at 3016 S. Grand on the South Hill. Called the Learning Academy, it is licensed to YMCA of the Inland Northwest and operated by the downtown-Spokane YMCA. It earlier had opened another such center thats operated by a private Lutheran school in the San Diego area, he says.
Fowler also has been testing his tutoring program at three independent, for-profit centers in Arizona and one in Florida, all of which were opened last year under licensing agreements with A Thousand Points of Knowledge.
He says those centers were opened before he refined his idea of seeking nonprofit collaborations. He adds that he doesnt plan to pursue other such for-profit centers.
Fowler says a YMCA in San Diego also is considering opening a tutoring center under the Spokane companys program, and he adds that YMCA officials have told him they will encourage other YMCA outlets across the country to consider opening such centers.
Under the collaborative agreements that A Thousand Points of Knowledge hopes to reach with the nonprofits, the Spokane company will provide all of the materials and furniture the organizations will need to operate a center and will train the centers employees. In return, the Spokane venture will receive a 35 percent to 50 percent share of the revenues each nonprofit earns through tutoring.
The centers will offer tutoring on reading, math, and general study skills.
Fowler says that since he left Sylvan 13 years ago, the cost of tutoring has risen dramatically and now averages about $46 an hour and runs as high as $90. By keeping overhead down and working with nonprofit operators, Fowler believes A Thousand Points of Knowledges centers will be able to offer tutoring for $20 to $25 an hour.
He also says that in many of the collaborative agreements the company expects to reach with nonprofits, tutoring will be made available to all children, whether or not their families can afford the hourly tuition rate. Fowler says that will be possible by using scholarship money, which in some cases might be taken from a portion of the revenue raised from paying customers.
A Thousand Points of Knowledges operations plan projects that the company will be operating more than 60 centers within a year after it completes its fund-raising, about 250 centers within two years, and nearly 800 centers by year five. It expects revenues to crest $4 million in its second year and to total $41.9 million in its fifth year. Those are very conservative numbers, asserts Ron Johnson, a partner in Allison Johnson and author of the start-ups operations plan.
As the educational ventures name reflects, Fowler says he hopes it eventually will have 1,000 centers. Really, we believe we can do 2,000, he adds.
Sylvan talked to Peter Allison and Ron Johnson, the two principals of Allison Johnson Venture Partners, about six months ago. At the time, says Allison, Fowler was thinking of launching the educational start-up in the Seattle area, where he had lined up a potential venture-capital deal.
We decided we could do the whole thing right here in Spokane, Allison says.
Because A Thousand Points of Knowledges centers will be operated by nonprofit organizations, the Spokane companys own employment is expected to be modest. Fowler says the company currently employs five, but he expects that number to grow to about 25 this year and to nearly 50 by the end of next year. Those jobs all will be based here and will involve roles such as accounting, customer service, marketing, and training.
Thus far, the company has been funded privately by Fowler, who says he became independently wealthy when he cashed out on his earlier ventures and then spent several years traveling the world.
This month, Allison Johnson has launched a private-placement funding thats expected to raise $5 million to help roll out A Thousand Points of Knowledges expansion plans. That fund-raising is expected to be fully subscribed within 90 to 120 days, says Allison.
Fowler, who also is an author, moved to Spokane five years ago with his wife, Anne, a Spokane native, and their four children.