TAMPA — In 1989, Ronald Bailey took a risk: He mortgaged his house to help finance his $5 million purchase of a controlling stake in Strayer College in Washington, D.C. Unlike many other entrepreneurs, Bailey struck gold, turning the foundering education center into a multimillion-dollar corporation.
Bailey sold the school in 2000 for $150 million, making more than $70 million from the sale.
He then trucked his riches to Tampa Bay to head the Bailey Family Foundation. It has quietly distributed $25 million in college scholarships since 2001 to students in Pinellas, Polk and Hillsborough counties.
Bailey doesn't seek headlines and operates discreetly from an office building in the Hyde Park neighborhood.
"People are leery of foundations and think all they want is money," he said. "I don't need money; I have it. I don't have much of an ego. I like to think I'm doing something good."
The foundation, worth about $50 million, awards renewable $5,000 scholarships to one student from every high school and every college in Pinellas, Polk and Hillsborough counties. Each student also gets a computer.
Bailey attributes his rags-to-riches tale to hard work and education.
After teaching for several years at Strayer, Bailey worked his way up to vice president.
In 1989, he bought controlling interest of the school and targeted working adults who juggled college courses into busy schedules so they could qualify for a better jobs. The college became Strayer University. He developed a graduate degree program and revised the university's computer courses.
Bailey is active with many organizations, including the University of Tampa, the Special Operations Warriors Foundation in Tampa, the Salvation Army, the Florida Orchestra, the Straz Center and Tampa General Hospital. He has also donated hundreds of thousands of dollars to high school students in northern Virginia.
He talked to the Times about his foundation.
Why do you donate to local students?
It is important to Beverly (his wife) and I to support the community in which we live. We like to support the colleges and universities in our community. Kids appreciate it. It's unbelievable, the letters I get from parents. For a lot of people, it makes a difference. The $5,000 is the cost of in-state tuition.
You described yourself as a "poor boy" from the coal mines of West Virginia. How did those mines impact you?
I graduated from high school in 1959, but there was no work in the mines because they became automated. We were so poor I went to work as a grease monkey. I then borrowed $40 from an uncle and took a bus to Winchester, Va.
I went into the Army and got sent to computer school. I didn't even know what a computer was. (Bailey earned degrees from Strayer and American University.) I learned a skill. I was trying to finish my education and was asked to teach at Strayer in 1974. I got more involved in 1981 as a full-time professor. I worked my way up to become vice president. Everything fell into the right place at the right time.
Why did you buy Strayer?
I got it so I didn't have to work for somebody else. My accountant said it was a terrible mistake. In five years, it was paid off. I knew about accounting. I knew teaching. I learned marketing once I got there. That was the business model. People on Wall Street noticed me.
Strayer enrollment skyrocketed after you bought the school. Was your growth motivated by making money or expanding educational opportunities?
It was about the students. I never took much money out, but I still had to make a payroll. I still don't spend much money. My salary then was $96,000. Nobody made more than me. If they needed more, they needed to go somewhere else. I had no corporate structure and didn't call campus leaders managers. I called them coordinators. If you needed toilet paper, you had to get it yourself. But I knew the prices.
What was the key to Strayer's expansion?
The day I got control, we were successful in expanding the school. From 1989 to 2001, we went from 1,000 to 14,000 students. In Washington, D.C., you have a lot of gridlock. (We opened multiple) campuses that became extremely popular with working students. I didn't put them too close together. I did the same thing in Baltimore and Richmond. The profit margins were about 42 percent.
Florida lawmakers are pushing for an on online-only university. Should Florida have one?
It is the future. I think even at the high school level, some online classes would work. They're making the classes smarter. I was never motivated enough to do a home-study course. I think it's best if you also go someplace to take a class. We had the very first online classes in 1996 and 1997. When we first started that, the instructor had to be there online for it to work. There isn't a class that you can take that can't be taught online.
Times researcher Natalie Watson contributed to this report. Mark Puente can be reached at [email protected] or (727) 893-8459. Follow him on Twitter at twitter.com/markpuente.