Brazil embraces for-profit education, U.S. companies benefit

Brazil possesses one of the highest proportions of private sector universities in both Latin America and the world, according to the World Bank.

As the middle class grows and  GDP rises, the demand for higher education is going to continue to grow in Brazil and other emerging markets around the world.

One Chicago-based, private-sector education company, DeVry Inc., has taken advantage of the growing demand for higher education in Brazil.

“Brazil has one of the most robust private sector education industries in the world,” said Robert Lytle, partner at The Parthenon Group LLC. “Most of

Latin America shares an embrace for private sector education. Often you see these schools at the top of the rankings.”

“More than 70 percent of college students in Brazil are enrolled in private schools,” said Richard Garrett, managing director of Eduventures Inc.” Only nine percent of students enroll in for-profit schools in the U.S.

Worldwide, 153 students were enrolled in higher education institutions, up 53 percent from 2000, according to Garrett.

The demand is expected to continue to rise globally, especially in emerging markets where the middle class is growing and the population becomes aware that tertiary education means more job security and diversity.

“I have no doubt that more and more people will want to participatte in higher education, therefore the demand for quality institutions at higher prices points will increase as well,” Lytle said. “It’s a universal trend.”

In March 2009, DeVry acquired Fanor, a leading provider of post-secondary education in northeastern Brazil. Fanor, now a part of DeVry Brasil, is the parent organization of, Faculdade Ruy Barbosa, Faculdades Nordeste and Faculdade FTE AREA1 and offers undergraduate programs focused in business management, engineering and law.

Since the acquisition enrollment numbers have increased to almost 12,000 up from 10,000 in March 2009, according to Joan Bates, DeVry’s director of investor relations. February is the peak enrollment time for students in Brazil, so the company is expecting new student numbers to increase even more this month.

“Though there is a lot of competition in Brazil, there is also a lot of demand and it is growing,” Bates said.  “By the 2016 Olympics, Brazil is projected to be in the top five economies in the world.”

DeVry announced in its quarter two earnings press release in January that it is expanding programs in the DeVry Brasil group including environmental engineering, nutrition, nursing and physical education.

DeVry is following the successful model of Baltimore-based Laureate Education Inc., which purchased already established schools in Brazil and elsewhere, according to Garrett. Laureate Education has a network of schools in 20 countries, with nine universities in Brazil. Some of the company’s programs in Brazil are ranked the top in the world, according to a Laureate spokeswoman.

“Laureate set the standard of private, international education,” Lytle said. “They have taken public education internationally to astronomical levels and have had phenomenal growth.”

He also added that private sector education is ranked quite highly in Brazil in terms of academics, outcomes and overall quality.

“People at Northwestern, for example, may look down on for-profit education,” Lytle said, “But that is not at all the case in Brazil.”