Management Series: Zovio Growth Segment Review

  • Zovio Growth segment consists primarily of the Fullstack Academy and TutorMe businesses, both acquired in the first half of 2019.
  • Both businesses have performed very well since being acquired, with Fullstack having now 16 university partners (none when it was acquired) and TutorMe having tutoring contracts with 250 institutions.
  • Management is guiding toward 30% revenue growth for the segment, possibly a conservative figure given the actual recent growth rates. New Fullstack partner contracts involve upfront costs but turn EBITDA positive after about 18 months; management sees the segment turning EBITDA positive by 2023.
  • Both are attractive businesses with strong growth prospects coming from signing new partners and expanding offerings with existing partners. Recent results attest to the strong market demand for Fullstack and TutorMe services.
  • Both businesses contribute to creating a Zovio ecosystem of relevant and effective ed tech services targeting educational institutions; there could be long-term synergies with Zovio’s University Partners segment, in terms of marketing (similar potential university partners) and shared services (student onboarding, persistence analytics, etc.).


Zovio is an education technology company headquartered in Chandler, Arizona. Zovio provides services to universities to help them manage distance learning programs. These services include program development, marketing, and student monitoring and retention. Its current largest university partner is the University of Arizona Global Campus. Zovio also provides specific services directly to students or in partnership with universities and schools, such as the FullStack Academy (coding and computer security training), and TutorMe (tutoring services).


Executive in Focus: Chris Spohn, Office of the CEO and Executive Vice President of Operations, is responsible for providing strategic leadership and direction for student engagement, student success, financial services, and Zovio Employer Services.

Chris has over 20 years of leadership and operational experience in the online higher education and technology services industries. He served in executive leadership positions for several technology and education services companies, including Webwise Education and Higher Education Online. Most recently, he served as the president of Rocky Mountain College of Art and Design, where he completed a total re-engineering of all operations related to the university. Chris holds a BA in Political Science from Azusa Pacific University.

Thierry Wuilloud: I’m Thierry Wuilloud, Managing Director and Senior Analyst at Water Tower Research. I focus on emerging growth and special situations. We have C...


Water Tower Research (“WTR”) is a professional publisher of investment research reports on public companies and, to a lesser extent, private firms (“the Companies”). WTR provides investor-focused content and digital distribution strategies designed to help companies communicate with investors.

WTR is not a registered investment adviser or a broker/dealer nor does WTR provide investment banking services. WTR operates as an exempt investment adviser under the so called “publishers’ exemption” from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940. WTR does not provide investment ratings / recommendations or price targets on the companies it reports on. Readers are advised that the research reports are published and provided solely for informational purposes and should not be construed as an offer to sell or the solicitation of an offer to buy securities or the rendering of investment advice. The information p...