Bridgepoint Education becomes Zovio, moves headquarters and 600 positions from San Diego to Arizona
Bridgepoint Education has changed its name to Zovio and is moving its headquarters from San Diego to Chandler, Arizona, relocating 600 jobs.
(U-T File Photo)
By Mike Freeman
Bridgepoint Education, the troubled parent company of Ashford University, said it will move its headquarters and at least 600 jobs from San Diego to Chandler, Arizona,
The relocation also comes with a name change. Bridgepoint will become Zovio starting April 15.
The company, which announced the move earlier this week, expects to begin relocating jobs to a 130,000-square-foot building in Chandler this summer and complete the move over the next two years.
The new headquarters will house about 800 workers. Roughly 200 of those will come from an operations center in Tempe, Arizona. The rest of the jobs likely involve workers currently based in San Diego.
"We decided to move our headquarters to the greater Phoenix area because it enables us to tap into local talent, enjoy a favorable business environment and provide a more reasonable cost of living for our transferring employees, with opportunities for transferring spouses to find employment," said Chief Executive Andrew Clark in a statement.
Bridgepoint telegraphed the move when it declined to renew its lease at the 11-story Centrum office building in Kearny Mesa, which the Union-Tribune first reported on Feb. 26.
The company expects both Bridgepoint and Ashford University to vacate the building in the first quarter of 2020.
Bridgepoint said it will continue to have operations in San Diego -- as well as Clinton, Iowa, and Denver, Colo., -- after the headquarters move, but it did not disclose how many employees will work at these locations.
Ashford University is expected to remain based in California because it is accredited in the state, but the exact location has not been determined, a company spokeswoman said.
Bridgepoint's corporate relocation is part of a flurry of changes at the for-profit online higher education company, which has produced 120,000 graduates from its colleges over the past 15 years.
Perhaps the biggest shift is the proposed spin-off of Ashford University into an independent, non-profit university.
If the switch to a non profit gets the green light from Ashford's accreditation agency, Bridgepoint would become an outsource education technology services provider to Ashford.
Bridgepoint also aims to sell online education tools and programs to other colleges as well as to corporations seeking online training for its workforce.
"Today, America has seven million jobs currently vacant because of a shortage of qualified workers," said Clark. "Zovio will work alongside education institutions, employers and learners to provide technology and services …. to address the skills-to-employment challenge."
The shift in its business model comes as Bridgepoint faces myriad probes by state attorney generals and the U.S. Department of Justice over allegations that it made false promises to prospective students and used strong-arm tactics to collect on student debt.
Moreover, Bridgepoint has struggled with declining enrollment over the past few years in a trend that has plagued other for-profit universities.
After peaking at 85,000 students in 2011, enrollment at Bridgepoint-owned colleges fell to 38,000 last year. It ceased operations at University of the Rockies in 2018, melding degree programs into Ashford.
Bridgepoint's revenue fell 6.7 percent last year to $443 million. Earnings came in at $4.6 million, down from $9.1 million in 2017.
Bridgepoint said Thursday that the name change to Zovio also involves changing its stock ticker symbol from BPI to ZVO in mid-April. (Bridgepoint says the name Zovio was inspired by the Greek word "sophos," which means skillful, and the Latin prefix "vi" for visionary.)
"New name, new headquarters, new business model – lots of changes at Bridgepoint Education," said Piper Jaffray analyst Peter Appert.
The company has begun beefing up its education technology portfolio, tapping into its $192 million in cash reserves to make acquisitions.
In March, it bought Fullstack Academy, a coding boot-camp provider that has more than 2,500 graduates in its 13-week and 24-week programs in cybersecurity and web development. Bridgepoint paid $17.5 million in cash and up to 4.75 million shares of stock for Fullstack Academy.
This week, Bridgepoint acquired TutorMe, a Los Angeles provider of online tutoring, for $2.8 million in cash and roughly 400,000 shares of stock and assumed options.
"Our sense is the company is actively considering other transactions, which could potentially include purchasing an existing Online Program Management (provider) to jump-start efforts in this area," said Appert in a research note.
Meanwhile, Ashford University will hold its commencement ceremony on May 5 at the Viejas Arena.
Bridgepoint's shares gained 56 cents on Thursday to close at $6.88 on the New York Stock Exchange.
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