“I Never Lost Money On a Deal I Didn't Do”
The cofounder and former CEO of DeVry discusses his professional experiences, difficult lessons, and the significance of family.
Ronald Taylor, cofounder and former CEO of DeVry, Inc.
Ronald Taylor, cofounder and former CEO of DeVry, Inc.
Ronald Taylor is cofounder and former CEO of DeVry, Inc., a provider of educational services specializing in business, healthcare, and technology. In 1973 Taylor cofounded Keller Graduate School of Management, which acquired DeVry, Inc. in 1987. He retired as CEO of DeVry in November 2006. Taylor is a veteran of the U.S. Army and served in Vietnam. He earned his MBA from Stanford Graduate School of Business in 1971.
In 10 words or fewer, what is the big idea behind your business?
Practical business education for adult learners.
What is the best advice you’ve ever received?
“I never lost money on a deal I didn’t do.” I heard that from an investor back when I was starting my business and trying to raise capital. He ended up not investing in our idea. He could have made money on DeVry. At various times we have taken a pass on doing deals, and that phrase sticks with me. It pays to be thoughtful when you’re entering into transactions.
What was the most difficult lesson you have learned on the job?
Ignore the naysayers. There will always be people who say you cannot do what your dream or your passion is. They may not be able to see the vision or understand the passion. If you pay attention to them you will never accomplish the things you could accomplish. When we started what now is DeVry there was no for-profit school industry. There were no universities started by entrepreneurs.
When I got out of business school I worked at a company that owned a paralegal school. I met my business partner there. We thought of paralegal school as something between a liberal arts degree and law school, and began talking about something between a liberal arts degree and an MBA. We started with 7 students in 1973 with the idea that they would take classes from 8 am to 5 pm for 16 weeks. That idea failed. The population we were trying to serve needed to work during the day. We ran through most of our initial $100,000 that we raised from friends and family, and then raised another $45,000. We switched it to a part-time evening program, and that idea change allowed us to survive and grow.
Later on, we acquired DeVry, a technical institute, with $182 million in contrast to all the advice we received. It was a bet-your-company move. There was a grudging acceptance of for-profit education but we spawned a bunch of imitators, created a new sector, and led the way in online education.
What advice would you give other entrepreneurs on how to build a great business?
Focus on the people. Find the best people you can find and nurture them. We looked for people with unusual backgrounds who did not fit the corporate mold and put them together in an environment that was not typical. We ran contests, and everybody was very competitive. It became an interpersonal game to succeed individually, and in the process we succeeded as a group. We used to go in and evaluate each class. You never knew what you were going to find. In one class the faculty member was lying on the table at the front of classroom. I said, “What the hell is going on?” He said it was too stuffy, and he needed to give the students a visual change. It was unusual but it helped to make it a better experience.
What inspires you?
My father was an immigrant from Austria. He came to the U.S. with no money but he had a trade: he was a tailor. He moved to the Midwest and started a little tailoring business and raised two sons. There was a sense of obligation to take the talents I had and to use them in a way that was as good as they could be. I started working when I was 11 with a paper route. My mother helped me roll up the papers in the morning. There wasn’t a plan. They were not tiger parents. They were interested and encouraging.
What is your greatest achievement?
In life, a stable 38-year marriage with 4 great kids and 6 really good grandkids. In business, starting DeVry with $100,000 and creating a multimillion-dollar business. The thought that we helped to create an industry and influenced the educational structure is satisfying. My family and my business are both pretty important.
What do you consider your biggest failure?
Not learning German. I failed to recognize this was part of my heritage. So many immigrants want to be Americanized but I wish I had done a better job of connecting with that aspect of my history.
What values are important to you in business?
Honesty and hard work. They go a long way.
What impact would you like to have on the world?
I’ve already planted the seeds and seen the tree grow. The remaining impact will be related to watching my grandkids grow up.
What was your first paying job?
When I graduated from high school I took a job at a hospital near my home as an orderly. I thought I might want to become a physician. After a month and a half of making beds, giving back rubs, and emptying bedpans I said this was not what I wanted to do. Then I sold railroad ties throughout undergraduate school. I met a guy there who was influential on me. His desk was covered with paper, seemingly not sorted. He said, “People can’t tell what you’re doing if your desk looks like this.”
What is the best business book you have read?
I’m a natural skeptic. There is no particular book that has influenced my business activities in a significant way. I don’t like platitudes or “five things you need to do.” One book you should read is Reckless Endangerment, by Gretchen Morgenson. It is the clearest explanation of how we got into the recent financial mess from a regulatory and macroeconomic point of view. It was an eye opener to me.
What businessperson do you most admire?
I’m not a hero-oriented person. I’ve seen clever image-making that can be bought.
What is the most valuable thing you took away from your time at Stanford?
At the time I thought it was silly stuff but the most valuable lessons came from the people-oriented courses by Harold Leavitt and Thomas Harrell.
What do you think is the greatest innovation in the past decade?
Simulation in medical education. We use this at DeVry. It is a huge change to be able to teach anatomy by performing simulated medical situations on simulated slices of the body. This has led to enormous strides in understanding the human body.
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