How to Start a Million Dollar Business in the Education Industry!

Million Dollar Minutes Episode 2 is an idea that revolves around the struggling higher education system. What if there was a way to benefit all parties involved (well almost all parties). Think of it as an incentive insurance policy, that allows you to file a claim when something good happens; instead of how most insurance claims work (when something bad happens).

Most (if not all) first time college freshman believe they will eventually graduate college. However, statistically speaking, only 40-60% of them in the US will actually walk on stage to collect their degree (in a timely manner). Therefore, early on most people would believe they would benefit from something like this.

The way I imagined it would work is as followed:
Prior to the start of their college career they would need to have signed up for a policy, I don’t believe it will be beneficial or affordable for existing students. Those signing up will need to determine the amount they would like covered; the total tuition cost of a 4 year degree would be a good starting point. The company would then calculate a premium based on the school they are attending (different schools have different graduation rates) and also the amount they would like to get coverage on. One could also add the students major or focus into their premium as well, however, most college freshman will change their major multiple times.
As students drop out, the amounts paid in premiums will be nearly pure profits for the company. However, when a student graduates (possibly set graduation due dates) they may file claims to have their tuition (the amount of their coverage) reimbursed.

This could potentially benefit the following:

The students who graduate: Eliminating their college debt right away.

The school: potentially increasing their graduation rate.

The state or college loan lender: Fewer loans should be defaulted on.

Additional thoughts:

- Could potentially target high school students (their parents) to get policies for a reduced payment towards their premium.

- Premiums may change year to year as graduation rates change.

- Could potentially collect interest off of premiums during the first 3-4 years students are in school.

Obviously there are a million different ways to approach and tackle this idea, and I’ve only touched on a few pointers to consider. Be sure to let me know if you’ve decided to pursue this idea as I would love to follow your progress.

If you have any questions or suggestions for this idea, leave them in the comments below. If there is enough attention, I’ll make a follow up video to answer the questions and comment on the suggestions.

[gurbazdhillon]

Sure, 40-60% of people don't graduate but I find it unlikely that 40-60% of students would purchase a policy. My suspicion is that you won't see the same satisitical representation due to the inheirt difference between those who are able to graduate college, and those who can't.