INTO THE JAWS OF UNCERTAINTY

Friday December 16 at 1pm doesn’t have the resonance of High Noon but a court filing1 suggests it may be the moment for a Special Set Evidentiary Hearing to determine whether a Receiver will be appointed for INTO USF Inc2 (INTO)3. It is termed, somewhat ominously, a JAWS4 hearing in the Docket Entries for the case but it’s not clear who is “gonna need a bigger boat”.  Churchill may have said that “meeting jaw to jaw is better than war” but in business terms this encounter may defy that maxim.

As always, this blog attempts to inform readers but notes that no opinion is offered on the merits of the case or the assertions by either side. For keen readers of detail, the paperwork in the case is filed with The Circuit Court of the Thirteenth Judicial Circuit in and for Hillsborough County, Florida Circuit Civil Division and is publicly available. The Consolidated Lead Case is CASE NO.: 22-CA-006001, Div. L, with a secondary case as CASE NO.: 22-CA-006726, Div. L.

These are complex matters and I will be happy to receive authoritative factual corrections and make any necessary amendments.

WHAT’S IT ALL ABOUT?

The Hearing follows a Motion and Incorporated Memorandum of Law from USF Financing Corporation (USFFC), on 3 October 2022, for appointment of a receiver5. The fundamental request is that this is “…to (1) take control of the assets of the Company and (2) release what should be state auxiliary funds only for the purpose of funding the teach-out, together with such other and further relief as this Court deems just and proper.” 

INTO’s response on 24 October6 urged the court to reject the request with the Argument under two main headings – that “the Joint Venture Is Not Engaging in Self-Dealing Or Waste” and that “the USF Parties’ Arguments Are Baseless.”  It also notes “Appointing a receiver is a rare and extraordinary remedy.” Plaza v. Plaza, 78 So. 3d 5, 6(Fla. Dist. Ct. App. 2011).”

USF made a reply to this on 31 October7 noting that “The USF parties seek to protect for the teach-out $7.5 million of payments made by international students and sponsoring foreign governments for academic instruction and student housing provided by USF.”  They assert that, “At no point in their Response do the INTO Entities indicate they will forward those funds to USF to be used for their intended purpose.”

THIS IS ROUND TWO

Last time the parties were in court in relation to the case was on 19 August 2022 when an Evidentiary Hearing considered an Emergency Motion from INTO for a Temporary Injunction to Maintain the Status Quo.  There was “…live testimony by both parties” and the Clerk’s notes8 indicate that John Sykes, Co-founder and Deputy CEO of INTO University Partnerships, Kiki Caruson, Vice President of USF World and Fell L. Stubbs, Treasurer of University of South Florida and Executive Director of the USF Financing Corporation were in court as witnesses.

An order denying the Motion was made on 31 August9 with none of the four key requirements for preliminary injunctive release having been met.  However, it was noted that “..this ruling is not dispositive or determinative of the merits of the main issues in the case.”

THE BIGGER PICTURE

There are over 100 pages of documentation, including original contracts, in the three documents related to appointing a receiver.  The dispute is part of a wider case centering on USFFC seeking a Declaratory Judgement on 21 April 2022 stating it “…provided its notice of termination of the University Services Agreement and the Direct Admit Marketing Services Agreement….. Once USF terminated the University Services Agreement with the Company, this termination automatically terminated the Stockholders Agreement, which now requires the parties to dissolve and wind-up the Company.”10

INTO’s response of 20 September noted that between February and April 2022 they understood that USF were “..exploring the possibility of revising by mutual consent the original terms of the partnership” but that USF then “…improperly sought to terminate their contracts with Plaintiffs and dissolve INTO USF, Inc.”  They also state that they “..have at all times vigorously disputed USFFC and USF’s assertion that the Joint Venture was insolvent. Not only is this conduct in bad faith and in clear breach of the parties’ contracts, but it represents a transparent attempt to wrongfully appropriate the business of a company that was supposed to be its partner and that it knows has substantial value.”11

Apparently, “The parties have engaged in both forms of alternative dispute resolution mechanisms, but were unsuccessful in reaching a resolution of their dispute.”12

On the legal side USSFC are represented by Buchanan Ingersoll and Rooney PC while INTO have Sivyer Barlow Watson & Haughey, P.A., Bush Ross, P.A., and Susman Godfrey L.L.P.  The latter’s website makes the claim that they are “..America’s premier litigation boutique” so the stakes seem high. 

Notes

All filing references relate to documentation filed with The Circuit Court of the Thirteenth Judicial Circuit in and for Hillsborough County, Florida Circuit Civil Division. 

  1. Filing #159856710, E-Filed 10/24/2022. Jaws Confirmation No. 12J – 349103917354.
  2. INTO USF Inc.,is described in its Marketing and Recruitment Services Agreement with INTO University Partnerships Limited as “offering a range of academic preparatory programs and English language courses to international students which, when successfully completed, enable qualified international students the ability to progress to undergraduate and graduate degree programs at the University (collectively, the “INTO USF Programs”) Filing # 153460265 E-Filed 07/15/2022 Exhibit B
  3. For simplicity the term INTO is used for submissions by defendants, INTO USF LP, a Delaware limited partnership, and INTO USF, INC., a Florida corporation, in the Consolidated Lead Case CASE NO.: 22-CA-006001, Div. L where USF Financing Corporation (USFFC), a Florida not-for-profit corporation, is the Plaintiff (Filing # 156524107 E-Filed 08/31/2022).
  4. JAWS is the acronym for the Judicial Automated Workflow System for the Thirteenth Judicial Circuit System of Florida.
  5. Filing # 158504942, E-Filed 10/03/2022
  6. Filing # 159869006 E-Filed 10/24/2022
  7. Filing # 160306990 E-Filed 10/31/2022
  8. CDOCboa89b3b594b23_1661607751
  9. CDOCbo8ffb49b6e49c_1662035965
  10. Filing # 153460265 E-Filed 07/15/2022
  11. Filing # 157809124 E-Filed 09/20/2022
  12. Filing # 153460265 E-Filed 07/15/2022

    Image by Dmitry Abramov from Pixabay 

    Open Doors or Closing Time for US Pathways?

    Open Doors data for 2021/22 confirmed trends that have already become evident in the UK and are likely to shape the future of global student recruitment for several years.  It also points to some stark realities for pathway operators that may cast a shadow over any hopes for a post-pandemic recovery in the US.  Most starkly, the recovery was marked by the highest ever new postgraduate intake, largely driven by students from India, while new undergraduate enrollment was only just above 2011/12 levels.

    Will China Bounce or Break or Will It Depend Where It’s Dropped?

    One of the biggest questions facing pathway operators in the US is whether enrollment numbers from China have reached a low point and will rebound.  The overall number of degree students from China enrolled in 2021/22 was 232,674 which was 16.7% down on 2017.  Undergraduate enrollments were down 26.3%.

    However, the impact is not the same across all states.  Consideration of the 25 states with more than 10,000 international students in 2017 shows four who increased the overall number of “Foreign Students in the State” – Arizona, Massachusetts, North Carolina and Maryland. The first two made significant percentage increases from India while the latter two also increased the percentage enrolled from China

    By contrast the two states with the largest percentage loss in international students over the five years were Oregon (-42.4%) and Iowa (-34%).  Of the 25 states, they had the highest percentage of students from China and in the case of Oregon the second highest percentage was from Saudi Arabia rather than India in 2017.  The leading universities in each state – Oregon State University, Corvallis and Iowa State University – lost 26.7% and 30% of international students enrollment respectively.    

      *Information from Open Doors Fact Sheets 2017 and 2022.  Numbers relate to “foreign students in the state”. 

    A thoughtfully argued piece in University World News has suggested that a variety of factors could see a significant rebound by Autumn 2025.  This is tempered by factors including the growing strength of other recruiting countries and the developing academic quality of Chinese universities.  Others have suggested that unpredictable geopolitics, the potential for online delivery and universities desire for diversity may be major factors suppressing demand from China. 

    Either way it seems an unpredictable future and not something to bet the house on.  Certainly, US universities wanting to rebuild their numbers are going to have to think long and hard about products, price points, promotion and graduate employability.  It seems possible that as global alternatives increase, recruitment markets change and in-country competition stiffens the role of pathways will come under further scrutiny.    

    Pathways Poser

    Responses by the main pathway operators to changing market dynamics have differed.  A previous blog illustrated Shorelight’s pivot from pathways to direct recruitment options but there has been little sign of such significant movement from its main US competitor, INTO University Partnerships (IUP).  The situation in Oregon, home to key IUP partner Oregon State University (OSU), suggests that the need for action may be growing.   

    OSU provides long term, consistent enrollment reporting though its Office of Institutional Research which gives some weight to this thinking.  Despite the 2021/22 growth reported in the Open Doors data, OSU did not show international postgraduate growth in Fall 2021.  Fall 2022 numbers show another overall decline in international enrollments driven by falling undergraduate numbers and only limited growth in postgraduates.   

    *These figures include all INTO Oregon State University (INTO OSU) pathway enrollments except Academic English

    The impact of declining numbers from China is evident.  Despite recruitment support for direct admits from pathway partners IUP there seems to be limited ability to accelerate enrollment of students from other markets to compensate.  While the number of students coming from India to enrol is showing reasonable growth it is starting from a low base. 

    Overall enrollment has been impacted by a continuing decline in the INTO OSU pathway operation.  Undergraduate pathway enrollments in Fall 2022 were down 80% over five years (and 65% on 2019), while graduate pathway enrollments were down 57% over five years (and 62% since 2019).  Total enrollments for INTO OSU have fallen 72% since 2017.

    A previous review of Fall 2022 preliminary numbers from INTO George Mason University showed that IUP’s pathway operation at that university was struggling to bounce back after the pandemic but there was no information available concerning countries of origin.  INTO OSU data offers country insights and shows that three of the four main countries of origin have seen declines, with China falling from 581 students to 48 over 5 years (92%).  Numbers from India have shown small fluctuations but in Fall 2022 the intake of 16 was the same as in 2017.

    Money Matters

    Alongside declining volumes the INTO OSU debt to IUP increases.  This is, presumably, all well and good if the joint venture can generate enough pathway enrollments or find alternative revenue streams to pay the debt back over time.  However, three of IUP’s US joint ventures have closed in recent years – at Colorado State University, Marshall University and Washington State University – with a fourth, at St Louis University now wholly owned. 

    The joint venture at the University of South Florida is not currently recruiting and is under threat.   Recent court filings have shown that USF Financing Corporation (USFFC) sought a “declaratory judgment that the 2010 stockholders Agreement between USF FC, the Company, and the INTO Defendants is terminated as of April 21, 2022.” The grounds were that the joint venture is “insolvent under both a balance sheet basis and inability to pay debts as they become due, and (b) has demonstrated a material adverse financial position where it could not perform all or a substantial part of its obligations..”.

    *Taken from IUP annual reports up to and including that for the year ended 31 July 2021.  Excludes INTO SLU which is wholly owned, INTO USF which is not currently recruiting and INTO Hofstra which the INTO University Partnerships annual report does not record as a joint venture.

    **The 2021 Financial Statements of Illinois State University (p.50) note that “INTO ISU has an agreement with its two partners, Global and INTO NA, which allows INTO ISU to borrow up to $6,000,000 in operating capital from INTO NA with an interest rate of 6%…. INTO ISU has outstanding borrowings with INTO NA in the amounts of $6,000,000 and accrued interest of $488,392 for the year ended June 30, 2021.”  INTO NA is a wholly owned subsidiary of INTO University Partnership Limited (IUP).

    Reflections and Realities

    Global pathway operators have many creative, flexible and commercially minded individuals but it’s worth remembering Margaret Thatcher’s dictum that “there is no way in which one can buck the market.”  Open Doors provides a picture of 2021/22 but as more universities report on their Fall 2022 enrollments it becomes even clearer that the dynamics have changed.  With all four major recruiting countries having relatively benign government policies it is no time to be clinging to outdated models with 2023 recruitment already starting.

    Notes

    As always the text reflects my understanding of the data. I am happy to receive any alternative thoughts or corrections from authoritative sources.

    Image by Kingrise from Pixabay 

    Qatar Carry On

    “Do you like horror movies?”  The eyes of the princess danced as she asked the question of the exhausted foreigner.  It had been a long, long day but there was no easy answer to the follow up question as the clock neared midnight.  She continued, “I love them, shall we go and watch one now?”

    Every international officer has a story about days without limits, meals without end and questions without answers.  There is something about jet lag which makes you feel you can stay awake forever while being so tired that your brain is pleading for sleep.  Fixed eye stares and a ghostly pale pallor were the hallmarks of any overseas trip where time was tight and ambitions exceeded hours in the day.

    I was usually fortunate to travel with people who knew the country as well as being looked after by in-country agents intent on showing the best it had to offer.  Apart from leaving me in a burning hotel in Mexico and under military inspection on the wrong side of passport control in Vietnam, the international office teams I worked with usually seemed keen to bring me home in one piece.  So, in July 2008, a one-week sprint through Saudi Arabia, Bahrain, Qatar and Dubai with Craig Smitherman seemed a reasonable idea.     

    Road to Riyadh

    It all began with a 4.30am start to catch a Lufthansa flight from Heathrow to Riyadh via Frankfurt.  My first and only time on the German flag carrier, which had all the efficiency and charm expected by an Englishman of a certain age.  I could find no evidence that I was travelling on an ex-Interflug aircraft but wrote in my journal that “..now I see how they found a use for the mothballed bomber fleet after the war – not comfortable.”

    Two days jammed with meetings in Riyadh included a visit to one agent who offered us a lift back to the hotel rather than getting a taxi.  A feature of country visits was to smile and say yes, which was all well and good until we stood in the car park in 44 degrees of sunshine and the agent revealed that his car’s air conditioning had broken.  We smiled again and said, “No problem.”

    I don’t know how the chicken feels when it goes in the oven but I do know that it is not wearing a suit, tie and lace up, leather shoes.  Perhaps as well it wasn’t a t-shirt and shorts because the seat felt hot enough to sear skin.   Having the windows down made absolutely no difference, while the screech of brakes, honking horns and frequent curses was a reminder that one commentator has written about Riyadh’s “cruel traffic.”          

    Eating for England

    Flying Riyadh to Jeddah for a single day of end-to-end meetings made good use of time but led to an ad hoc breakfast meeting before the early morning flight next day.  From Jeddah to Dammam on the other side of Saudi is only two hours but this was day four and after another 4am start fatigue was setting in.  There was a long drive awaiting as we set off through the desert for a session with Saudi Aramco.

    Two hours after landing we had driven past a lot of sand and were entering the company’s compound.  Driving into the entrance required passing under the business end of a tank and multiple armed guards which were both signs that we were a long way from home.  But winning further investment for activity with the university was a reminder that time spent getting face to face in remote outposts almost always paid off.

    Then there was lunch.  Stomachs still heavy with breakfast we gamely ploughed on through several courses until it became apparent they would keep on coming until we gave up.  We did not come, see and conquer as much as chew, nibble and eventually beg for mercy.

    The Princess and the Pasta

    Beyond replete we went over the bridge to Bahrain and landed in Doha at 7.30 in the evening.  Our turnaround in the hotel was 15 minutes and we entered the land cruiser to be met by the agent and a companion she introduced as her cousin.  The agent wore a hijab while the cousin wore a niqab.

    The first destination of the evening was a shopping mall where Craig and I followed our hosts at a respectful distance.  Shops full of jewellery, fabric, ceramics and clothes were perused without purchase.  There seemed a certain irony to us trailing several paces behind the women.

    Almost inevitably there came time when food was mentioned.  Bellies loaded with Jeddah breakfast and Dammam lunch groaned in protest but our faces smiled and our mouths said yes as, 17 hours into the day, we sat down to eat – again.  Polite conversation was made and we learnt that the cousin was related to the royal family and was a poet of wide renown in the country who gave readings for the Emir.

    It had reached the stage of brain fog where nothing came as a particular surprise.  Why wouldn’t we be trying to stuff down the third major meal of the day, in a shopping mall, at eleven o’clock at night, in a foreign country in the company of a poet-princess?  All in the good cause of recruiting international students.

    Things Of the Night

    But the subject turned to films and the princess was expressing her love of old black and white horror movies like Dracula and Frankenstein.  Incautiously, I indicated that I was not much for current horror movies but had fond memories of the old Hammer films .  I may even have ventured opinions about the various merits of Vincent Price over Christopher Lee.

    Seconds later the invitation to go and watch a movie was made.  My slightly hazy brain turned over the idea of being in a Qatar cinema at 1am in the morning with a princess by my side as Van Helsing drove a stake through a vampire’s heart.  My slightly addled brain was saying that it would be polite to accept the invitation, while something I like to think of as common sense was screeching that this was the worst idea of the day.

    I think the offer was real but it’s possible I was being teased.  My stuttering apology of early meetings next morning and it having been a very long day were graciously accepted.  It’s a regret that I didn’t say yes and I am sure my reluctance was a sign I was not cut from the cloth that makes the best international officers.

    Image by Lumpi from Pixabay 

    The Name of The Game

    A minute is a very long time.  In the silence of the interview room with a vice chancellor and five unfriendly faces looking at me it was getting longer by the second.  What had seemed a good idea in planning was losing credibility faster than a Liz Truss/Kwasi Kwarteng mini-budget.  My nerve broke…

    Interviews share some of the characteristics of democracy in that they are the very worst form of selecting a new employee apart from “all those other forms that have been tried from time to time.”  Much like an election, they can be a lottery where the politics on the other side of the table matter much more than the candidate’s capabilities.  I succeeded at each of the first three interviews in my career but had a hit rate well under 20% after that.

    I should probably have been better as a candidate because I’ve spent plenty of time as a hiring manager and chairing interview panels.  But over the years the process seemed to become increasingly focused on ticking compliance boxes rather than having a decent conversation with someone about their fitness for the role.  Most interviews are so dull they are instantly forgettable but there are a few examples where I’ve overextended my hand in trying to liven them up.

    Silence Is Golden2

    The silence in the interview room and my loss of nerve came during a two-minute slot where I was invited to give an overview on my suitability for a role as the university’s head of communications.  I had decided to sit totally still and wordless for the first minute.  It was intended to be a precursor to explaining that this symbolised an institution that had communicated nothing of importance for months.

    My inspiration was a tale from the advertising world when Allen Brady and Marsh tendered for the British Rail contract in 1977. The client team, led by then BR chairman, Sir Peter Parker, arrived at ABM’s reception for the presentation to be met by a bored receptionist and were made to sit in a waiting room where the tables were festooned with used coffee cups and cigarette butts.  They were about to walk out when agency director Peter Marsh and his team appeared.

    Marsh said, “What I’ve been trying to demonstrate to you in these surroundings and the indifference of our receptionist there, is the experience your customers have of you, British Rail, every day. And it’s my job and intention to show you how we will overcome that problem. Shall we go and have lunch…”  Totally brilliant in terms of concept, timing and nerve.

    Among the problems with my own attempt at performance art was that I had forgotten to set my watch, the evident hostility of the panel at this unexpected silence got to me and we certainly weren’t going for a slap-up lunch afterwards.  As the tension in the room grew I decided to speak up well before the end of the minute but fluffed the explanation, so they only heard me telling them what a terrible job they were doing.  Totally my fault for bungled execution and the interview spiralled downwards from there, but as the vice-chancellor didn’t last much longer in his job it was probably a narrow escape.

    Shine On You Crazy Diamond3

    A later outing was with a well-ranked university where my research had revealed that the VC was a world specialist in materials with interests including alloys and crystallography.  With this insight, I decided to base my vision for communicating the strengths of the university by using the metaphor of it being an undiscovered diamond.  As I concluded my description the vice chancellor, who was chairing the panel, told me he was an expert on the subject.  I said, “I know,” which were the last words from my lips for several minutes. 

    He proceeded to hold court, to a panel of ten, with a lecture on the characteristics of diamond formation, minerals, organic and inorganic compounds and alloys. Most particularly, he pronounced on why the metaphor didn’t correspond with his learned view about the diamonds.  It was probably not helpful for me to suggest he had missed the point and that popular opinions about diamonds reflected more on their value and popularly understood characteristics than their chemical composition and isometric structure.  

    Everything I had heard about the institution being a tightly controlled autocracy became painfully evident as the panel took their cue from the top. The rest of the hour was a reminder that a good chair speaks last if they want to ensure they hear a diversity of views and opinions. My only consolation was thinking it’s sometimes better to crash, burn and learn than to land safely in the wrong place.

    The Games People Play4

    I was also particularly bad at the two days interviews which became popular with some universities.  At one south coast institution I wowed an audience of 20 on day one with a presentation on the theme of distant horizons.  I even managed to pull off a joke about the university being similar to Spock of Star Trek in having three ears – right ear, left ear and space the final frontier. 

    Day two was a terrible series of dull question and answer interviews culminating in a one to one with a vice-chancellor who had some pretty fixed views about pathway operators. They were suspended several years later after, as one of several issues, commissioning seven custom-made chairs costing £95,000.  Wouldn’t have fancied managing the PR for that anyway.

    But this is where the Lefty Gomez quote suggesting that it’s better to be lucky than good comes in.  For one interview, I was a last minute addition to the list of six candidates because someone dropped out late. I missed the day of campus tours because I was driving many miles to get there and secured an agreement to be the first interview of the next day.

    In the car park next morning, I bumped into a suited, slightly harassed looking person who I guessed just had to be one of the other candidates.  I enquired how things were going and he told me he was just getting some handouts and overhead projector slides produced to give to the panel.  At that point I hadn’t put my suit on let alone thought about my opening statement.

    Forty-five minutes later I was asked for a brief overview on how I would approach the job.  I paused for effect and looked around the nine-person panel.  “Some candidates will probably come here today with slides and handouts which suggest that they know this institution better than you do.  My view is that you are probably more expert than I will ever be in understanding the academic heart of the university but that I would add value by being the expert at communicating your work…” 

    After my appointment the Registrar told me that the very next candidate after me had done just as I predicted.  I chose not to tell him the background.  Neither did I tell him that my opening statement had an even greater truth because I really didn’t know very much at all about universities or the higher education sector. 

    “Get your retaliation in first,” is what Willie John McBride, captain of the famous 1974 touring Lions, told his team-mates when facing bruising encounters with the South African rugby team and it’s always seemed a worthwhile consideration.  But also, as Paul Newman says in Cool Hand Luke, “sometimes nothing can be a real cool hand.”  Either way, it was another lesson that interviews are a game where the best prepared and most knowledgeable don’t always win.

    Money For Nothing5

    No recounting of interviews would be complete without sharing the very best answer to an interview question that I have ever heard.  When recruiting new international officers, the favourite question was to put them in a scenario where their plane was delayed and they had landed in the early hours in a country with a reputation for kidnappings.  Their pre-booked taxi was nowhere to be seen, suspicious characters were hanging around and they found their wallet had been stolen.

    Faced with this situation it was interesting to watch relatively young and inexperienced people run through their expectations, hopes and fears while repeatedly foundering on the absence of cash or credit cards.  No calls to the embassy, no hailing a taxi, not even bribing an airport employee was possible.  There was only ever one winning answer.  The mighty Pete Ryan, a top guy who not only got the job but went on to become a Head of International Recruitment, barely paused before giving the world-beating, “Well it’s no problem, like, ‘cause I always keep a fiver in my shoe.”

    NOTES

    1. The lyrics of ABBA’s 1977 UK number one, Name of the Game, are worth considering in the context of interviews.
    2. The Four Seasons originally recorded Silence is Golden in 1964 but the Tremeloes’ version from 1967 topped the UK charts and reached number 11 in the Billboard Hot 100 chart, so is probably better known.
    3. Shine On You Crazy Diamond appeared on Pink Floyd’s 1975 album Wish You Were Here.  The song is dedicated to the late Syd Barrett, whose drug use and mental health problems caused him to be ejected from the band in 1968.
    4. Joe South’s 1968 Grammy Award winning song, Games People Play, is a pretty downbeat look at human character.  He went on to write Lynn Anderson’s 1970 hit, Rose Garden.
    5. Money for Nothing was released in 1985 as the second single from the Dire Strait’s album Brothers in Arms.  Sting sings background vocals and a falsetto introduction and came up with the line in the song, “I want my MTV”.  The guitar sound is, apparently, modelled on that of ZZ Top because of their popularity on early MTV.

    Image by Clker-Free-Vector-Images from Pixabay 

    Working For the Boss Every Night and Day*

    Getting pinned up against the end of a run of shelving in a half-fitted out store might not be everyone’s idea of good management training but it provided a lesson that came in handy over the next thirty years.  It wasn’t even my line manager doing the pinning.  But if it takes a village to raise a child it takes more than one senior manager to teach you about company culture and personal discipline.

    Over four decades, I started a new job 12 times in nine different companies (three of them invited me back for reasons that are hard to fathom).  With 21 direct bosses over that time, I’ve had nine leave or be replaced and nine where I left for greener grass or personal reasons.  Maybe I’ve been fortunate but all the social media posts about people leaving bad bosses (rather than companies) has always felt strange in the context of my own curiosity, ambition and occasional arrogance about chasing the next opportunity.

    Beauty in the Beasts

    There have been two bosses that I would think of as being directly responsible for me leaving a company.  There was also one organization where I couldn’t stay but my boss had my sympathy for being totally outgunned, outmanoeuvred and possibly even bullied into submission.  These examples account for three of the five occasions I’ve jumped ship without a lifeboat (or a job to go to).     

    The dismal duo of bosses were poor in very different ways.  One was very competent and went on to be a successful CEO but was always away, made no effort to help me settle into the company and, as it turned out, had inflated the importance of the role and opportunity when I was being interviewed.  The other was of limited ability in their own specialist field and a micro-manager who didn’t understand marketing and communications but was happy to take the glory when things went well while wielding the stick when things were less than perfect.

    If those types of bosses are the beasts of a career, they also lend a certain beauty to management development in learning from them how not to behave.  It’s not very comfortable at the time but taking the lessons can help you avoid making the same mistakes.  There is also something to be said for working out if what looks like an inadequate boss is doing their best to protect in impossible circumstances.          

    In fairness, I doubt that I matched up to their expectations either and would have to accept that from time to time I have been a less than perfect subordinate.  Hard working certainly but not always the best at accepting authority and, particularly in my younger days, a little too likely to burn the candle at both ends.  The only defence was that the early days were at a time when you were forgiven most things as long as you turned up on time and got the job done.

    Beginnings and Belonging

    My very first boss, Tony Dobbin at Tesco, was immensely hard working and benevolent.  When the company opened the UK’s largest superstore at Weston Favell he would lead the photography sessions, get home at 4am and still be at his desk in Cheshunt by 8.30am.  He also very gently taught me the nuances of word selection when writing promotional material where the word “aroma” was definitely an improvement on my draft about the “smell of freshly baked bread.”

    Despite a year on a journalism course my judgement of text was rough round the edges and I had an upbringing which meant I briefed a leaflet for a celebratory leaving event as a dinner when it was at lunchtime**.  It was a good job that I was keen to take on any task, enjoyed driving long distances and had no real sense of my own limitations or naivety.  Long hours, weekend working and full commitment were expected but usually rewarded.  

    It was the broader retail management of the company who gave me a real sense of purpose and belonging.  They ensured I got my first company car – a 950cc Ford Fiesta with a foot-pump operated windscreen washer.  The price was weekends photographing charity cricket matches with suppliers, evenings shepherding councillors around new stores and always being available for late night discussions about the latest food crisis.

    One certainty is that in the best companies, senior management outside the direct line manager pay attention to newcomers.  There is nothing better or more reassuring than having your existence and your work recognized by someone from elsewhere in the business.  It eliminates silos, encourages collaboration and creates the best sense of company culture.   

    Create Your Own Pressure   

    But the defining lesson in my first job was much more personal and came a few days before the opening of a new store.  I was with a senior regional director who was a company legend for his business success and who had been very supportive. He was well over 6’and it is fair to say that I am somewhat less lofty.

    It was total mayhem as painters, electricians, merchandisers, tilers and chippies raced to complete the fitting out in a breathtakingly short timescale.  At the time Tesco was opening two or three stores a month and every occasion was a race against the clock with most of the new store team living out of suitcases as they moved from town to town.  Only after I left retailing would I realise that not every business worked at this type of pace.

    As we walked along the bank of half-built checkouts with their trailing wires he turned to me and said, “Do you feel the pressure, Al?”***  As a 23-year-old who got on well with him I felt this was a good moment to try and be smart.  My response was calculated to try and be sophisticated, “Pressure.  What’s that?”

    In a moment he had turned and physically pushed me up against the racks at the end of an aisle of shelving.  My recollection is that he had my lapels and I was on my tiptoes as he loomed over me but he was calm and urgent.  He just growled, “If you don’t feel the pressure, you’ve got to make your own pressure.”

    I’ve told the story a number of times since and am usually asked why I didn’t report it to someone.  My response is that this was someone I respected giving me forceful advice about humility, self-discipline and respect for the work.  It was over as quickly as it began and my overwhelming sensation was that it had been done for my own good.     

    I wouldn’t recommend the physical element but when the book Radical Candor came out, I recognized that at an early stage in my career I had been shown the value of a manager caring enough personally, to challenge behaviour immediately and directly.  The underlying message was even more important.  Your boss is not responsible for motivating you – you are.

    NOTES

    * A lyric from Happy by the Rolling Stones.  One of those joyous moments when Keith gets to sing. Not sure he’s had too many bosses in his life.

    ** This is one of the classic differences between U and non-U English.

    *** He was one of only three people that called me Al (and even then only occasionally).  I am mildly fixated on calling people by their full names unless they ask me not to.

    Image by Miro Alt from Pixabay 

    FRANKS FOR THE MEMORY

    There was a shuffling to my far left and a quick glance revealed only the back of public relations legend Lynne Franks as she rooted in a bag under the table.  The black clad presentation team in the centre of the room was looking apprehensive as she emerged with a handful of tabloid newspapers.  Her voice rang out, ‘Stop Jane, this isn’t us, this is so formal and corporate.  We are not like that.  We know people, we are connected – let’s throw that (the presentation) away and I’ll tell you about what you need to do”

    Recovery and Renewal

    The story had begun back in July 1992 when I suggested to Allan Leighton that ASDA could half its PR expenditure on agency support.  My view was that the extant agency did not meet the urgent demands of a business that was fighting for recovery after recently staving off bankruptcy.  Saving more than half a million pounds in annual cost (about a million pounds at 2022 rates) was not an insignificant sum.

    I had joined ASDA three months earlier as the share price fell to its lowest and only six months after an emergency rights issue had helped stave off bankruptcy.  Archie Norman had been parachuted in by the October to lead a turnaround that would become a Harvard Business School Case Study.  The military metaphor reflects his later comment about crisis situations that when you’re the leader and you’ve landed in the jungle your team expect you to know which way to march.

    I shortlisted three agencies after initial discussions around a brief which could have been distilled into two simple lines.  Get one piece of positive national media coverage every week at half the current expenditure.  It was audacious because we were only third in terms of market share, no other retailer was close to achieving coverage that regularly and we wanted focus on the tabloids and TV that reached most of our customers, at a time when competitors were schmoozing the broadsheets.     

    Pitch Imperfect

    Fast forward to 11 November 1992 as a panel of Archie, Allan, Paul Dowling (Corporate Affairs Director) and I were receiving presentations from the three agencies.  The incumbent had declined to participate but had fought a bloody rearguard action accusing the entire in-house PR team of incompetence.  And the presentations had not started well.

    First up was a major PR name of the era who had FMCG and retail experience aplenty and a smooth pitch which featured, for reasons that escape me now, new technology that allowed shoppers to track their expenditure as they went round the store.  It was really just a calculator connected to the trolley and it needed recharging every three hours, but it seemed heady stuff at the time.  It was a terrific presentation up to the point where Archie asked the classic question, “How much?”

    The answer of £1.1m went down like the proverbial bucket of sick.  Archie looked to his right which was, unfortunately, my direction with an intensity that spelt real danger for wasting his time.  I was totally gobsmacked that the agency, who had been given a very clear steer on fee and expenses expectations, had been quite so brazen.

    Ninja Attack

    It was fortunate that the presentations were strictly one hour in duration and there was no time to debate what we had seen before I was shooing them out and scuttling down the corridor to collect Lynne Franks PR.  It was like entering a ninja convention with so many people dressed head to toe in black and grey.  Lynne’s pink coat, plastic shopping bags and bohemian look provided a colourful counterpoint to her colleagues.

    The presentation began with the ninjas – led by Jane Boardman the putative account director  – using enormous boards with very few words on them to present.  Big ideas, simple ideas, presented with conviction and style.  It was compelling and controlled until the rustling in the corner started.

    Emerging from under the desk Lynne threw a pile of newspapers on the desk and opened The Sun before ripping out a page and throwing it towards the bemused corporate team sitting in judgement on her agency.  “That’s one of ours…,” another rip and the Daily Mirror page was despatched towards the bemused panel judging the presentation.  “And so is that…,” the tearing frenzy continued. 

    In the centre of the room two presenters were frozen beside the gigantic boards.  The strategic big picture was wilting under the intensity of a founder who had decided that the way to deal with sceptical suits was to show results here and now.  I learnt later that Lynne had not been directly involved in preparing the pitch and had chosen to embark on a freelance mission of shock and awe with papers picked up at the airport that day.

    It was clear that the dramatic intervention had captured Archie’s attention.  Imagine the scene in Heat where De Niro and Pacino, as criminal and detective, discuss their ideologies while trying to psychoanalyze each other.  Their biographies had Archie as Charterhouse, Cambridge, Harvard, McKinsey and FTSE100 while Lynne was Minchenden Grammar, shorthand/typing at Pitman’s College, a regular dancer on Ready Steady Go, journalist and PR company founder. 

    But the differences that existed in education, upbringing, gender, and career choices faded under the weight of a principal-to-principal moment and when the frenzied ripping paused Archie moved swiftly to the point. “Why would we believe you’re any different to every other PR agency?”  It seemed obvious enough but Archie had a way of suckering mediocre people into obvious or rehearsed responses which were then flayed for lacking insight or interest.  Being provocative, challenging, unexpected or even slightly crazy was always the better way to go.

    Some key words in the response included “leverage”, “Lenny Henry”, “ASDA”.  Lynne turned the world of public relations into a trading proposition where her agency had showbiz collateral and we could benefit.  It was right in the sweet spot of a retail business mindset and bridged the gap to explain why an agency known for fashion and celebrity clients had something unique to offer a grocery store.

    Eventually Lynne’s explanation dried up and she looked to the team as if a little shocked at her own intervention.  Without comment, Jane picked up as if nothing had happened. It was a characteristic unflappability and focus on delivery which marked the following years of leading the team that worked with ASDA.

    Although attention moved back to the big boards it was like moving from heavy metal to soothing sonatas.  All of the strategies, plans and processes made sense but we were still absorbing the Sturm und Drang.  The good news for me was that the proposed budget came in smack on the nose at half the price of the incumbent.

    Aries Rising

    After the drama the third agency were competent but not even close.  We discussed the balance between cost, experience, track record and potential and whether Lynne was key or we would even get any of her time.  As it happened, she departed the business shortly after leaving a company where Samantha Royston in her late 20s was Managing Director and Julian Henry, still in his early thirties, was probably the elder amongst the management team.        

    The agreement was that Allan should visit their offices to see the operation.  He arrived at least half an hour ahead of the scheduled time but the office desks were filled, as I later found out with many friends and relatives, even further in advance.  It was set on Harrow Road W9 and far away from the bright lights and high costs of the West End – another tick in the box for a client whose operating principles included “we hate waste”.

    It was only as Allan was leaving that he passed Lynne sitting with her office door open.  They said hello and she told him that she had been kept out of the way.  When he confirmed he had seen enough to tell her that we would be signing up Lynne told him that she was an Aries and her horoscope had said it would be a good day.  It is unclear if she knew that he was also born under the sign of the ram.   

    Outcomes Count

    I never met Lynne Franks in person again and can only pay tribute to her extraordinary career as well as her influence as a spokesperson for women’s rights and sustainability.  I am told that she liked to have all her media teams to have had some cold calling or other sales experience in their lives.  It’s always seemed like good advice to me. 

    Following the appointment of LFPR, monthly measurement showed that ASDA’s national PR coverage consistently trounced the sector competitors.  The company’s recovery and renewal saw it eventually being sold to WalMart for £6.7bn in 1999. The LFPR and in-house PR team deserve recognition for their part in building a reputation that supported this outcome. 

    NOTES

    It’s impossible to remember everyone but a few thanks.  

    Jane Boardman (now CEO at M&C Saatchi Talk) who led the team and Graham Goodkind (Chairman of Frank PR). The PR powerhouse that is Sue Finnegan (founder of proof PR), who I later recruited to join the in-house team, and other colleagues including Tanya Hughes, Frankie, Lambert, Dorcas Jamieson and Francesca Lee.  LFPR was overseen during the time by Samantha Royston Wainstein (now Chair of the Mark Milsome Foundation), as MD then as CEO and Chair.  Julian Henry went on to found Henry’s House and is now Global Head of Communications for XIX Entertainment.    

    LFPR worked with the in-house team including Julie Eaton (later of Hill and Knowlton and recognized in the prestigious World Press Photo Awards 2014), Kathryn Williamson (later head of global PR for British Airways and now Director of Communications for English Rugby),  Jeni Cropper and Victoria Wick, who all helped make the difference.  It’s fair to say it was a talented team.

    Image by Clker-Free-Vector-Images from Pixabay 

    Let’s Do the Time Warp…Again*

    Back in September 2021, pre-pandemic and five Tory Education ministers** ago, a blog shortly after the restoration of post-study work visas reflected how this might be a factor in the party’s continuing tensions around immigration .  Suella Braverman’s speech to the party conference this week highlighted that the issue still exists and suggest a fault line through which university hopes for international student recruitment could fall.  It is not surprising that vested interests in higher education, who have been licking their lips at enrollment growth, have responded so vigorously.

    With a bit of a mind flip, You’re into the time slip

    Among the first in line for the defence was ApplyBoard Advisory Board Chairman, Jo Johnson, who also leads the company’s UK Advisory Board and its worthies in helping build the company’s business in the UK.   He was interestingly narrow in his choice of words and vaunted the importance of international students “..if we want to be a science superpower.”  It’s an echo of the original announcement from Priti Patel, in September 2019, which said the new Graduate Route ‘will mean talented international students, whether in science and maths or technology and engineering, can study in the UK…’

    The suspicious might think that this continues to lay the groundwork for a downgrading of the humanities or some form of quota system that favours the sciences above humanities when it comes to dishing out visas.  Almost inevitably that would play to the interests of the established hierarchy of universities with their lion’s share of science funding and students.  Those who don’t think these hierarchies have any place in Government policy, or that Ministers won’t allow league tables to distort thinking, would do well to remember that the High Potential Individual visa is currently restricted to graduates of 37 universities who have successfully navigated, manipulated or, for some, misrepresented their way into two of three nominated global rankings.

    It’s just a jump to the left, And then a step to the right

    Back in May 2022 when the High Potential Individual visa was launched, then Chancellor Rishi Sunak (remember him) was proud it helped “to create one of the world’s most attractive visa regimes for entrepreneurs and highly skilled people.”  This seems to have been a little too much of an open door for some and there are reports of the Home Office beginning a review of the number of dependants accompanying international students studying in the UK.  The numbers tell their own story with study visas up 71% from 2019 to 2022 while dependants have gone up over five times.

    Perhaps helpfully, if they are looking for beneficial treatment in the future, the Russell Group institutions may be able to argue that it is universities outside their club that are driving the change.  As noted in a February 2022 blog the RG universities were growing numbers from China while other universities were taking the opportunities afforded by growth from India and Nigeria as source markets.  This may be important in formulating Home Office thinking because the Telegraph reported that “34,000 Nigerian students accounted for 31,898 dependants while the 93,100 Indian students accounted for 24,916.”

     The siren voices on the right are unlikely to let the issue rest.  Alp Mehmet, chairman of Migration Watch UK, said: “It has been clear for years that a significant number of those coming to study and their dependants use it as a route into work and settlement.  It is yet another mode of uncontrolled and uncapped migration, often, feeding the demand for low-skilled and low-paid workers.”  It is a level of angst that seems likely to note that the top non-EU nationalities granted British citizenship in the latest year were Indian (16,720), Pakistani (15,624), and Nigerian (9,445) nationals and that these nationalities accounted for almost a third (31%) of all grants to non-EU nationals in the year ending June 2022.

    Not for very much longer, I’ve got to keep control

    The clues are all there in Braverman’s conference speech but the key word is control which appears six times in 18 sentences and particularly in terms the mission “to control our borders.”  The economy is to be developed by “..encouraging business to invest in capital and domestic labour. Not relying wholly on low-skilled foreign workers.”  The echo of Mehmet’s words above are probably no accident.

    But then we are taken back to Theresa May’s statement of March 2011 where she said, “We had too many people coming here to work and not to study. We had too many foreign graduates staying on in the UK to work in unskilled jobs. And we had too many institutions selling immigration, not education.”  It was the precursor to removal of post study work visas and a moment when international student growth in the UK began to fall rapidly behind that of Australia and Canada.

    By January 2013, Prime Minister David Cameron was telling the House of Commons, ‘Frankly, there are lots of people in our country desperate for jobs. We don’t need the brightest and best of students to come here and then do menial jobs.’  The real point was that PSW visas had been introduced in the UK in 2002 when unemployment was around 5% but it then rose rapidly due to the global economic recession.  A big question facing UK higher education now will be what happens in summer 2023 if the UK unemployment rate, particularly among graduates, looks to be going the wrong way at a point when a General Election is no more than 18 months away.   

    It is perhaps as well for universities that the traditional measure of graduate employment is aimed at the undergraduate market but it may not be long before attention focuses on the fate of postgraduates entering a tricky job market.  The shift in balance to having India as a major driver of international enrollments has altered the dynamics and it is slightly odd, but hardly unexpected given their record, that the OsF has not caught up with the situation.  With increasing numbers of international student likely to stay and take advantage of post-study work the likelihood of competition in the postgraduate market seems obvious.   

    It may seem far-fetched to consider this as a potential problem at a point when the unemployment rate fell to its lowest rate since 1974 just three months ago but the headline hides a more complex picture.  Craig Erlam, a senior market analyst at Oanda, commented, “It’s not often that you see the unemployment rate fall to the lowest in almost 50 years and aren’t overjoyed, but that will certainly be the feeling at the Bank of England right now.”  Unemployment rising to 8% looks unlikely but it is also difficult to find anyone who predicting in December 2021 that average two-year fixed mortgage rates would have moved from 2.43% to 6% in less than a year with every likelihood of going higher.

    But it’s the pelvic thrust, That really drives you insane

    The sub-heading offers a slightly crude metaphor for the way that competitors in the international student market, particularly Australia, might take the opportunity to build on the UK’s uncertainties, tensions and failure to take advantage of its early opening of borders.  The announcement of new post-study work rights has already swamped the claims of Sunak’s claims of an attractive visa regime and it comes with AUS$36 million to improve visa processing for international students.  It’s the type of coordinated decision making and rhetoric that becomes it much easier to point out the potential problems in the UK.

    Canada, which is not without its own problems, has also announced plans to increase the number of international students and foreign workers with extensive work experience for permanent residency in areas where there is a persistent labour shortage. A sub-text is that provinces and territories will have the freedom to modify their immigration streams to suit their own requirements.  That’s just a little more steam in the Canadian engine that has become an international student recruiting freight train.

    While hoping for the best and that sense will prevail, it is difficult not to think that the current Government is disjointed, capable of extreme views and likely to pander to populist thinking as an election nears.  It has shown little regard for the concerns of universities or the predicament they might face if international students decline and the institutions have willingly driven recruitment at a pace which has brought new stresses on the system.  None of it bodes well for the future and particularly not if the predictions of a long and deep recession come true.   

    NOTES

    * Headline and sub-headings from Time Warp by Richard O’Brien/Richard Hartley, which featured in the 1973 rock musical The Rocky Horror Show, its 1975 film adaptation The Rocky Horror Picture Show, and a 2016 TV production.  If you haven’t done it you really should.

    **Gavin Williamson (to 15 September 2021), Nadhimm Zahawi (to 5 July, 2022), Michelle Donelan (to 7 July, 2022), James Cleverly (to 6 September, 2022), Kit Malthouse (current but the record might suggest not by the time you read this…)

    Image by annca from Pixabay 

    Look Into UAC, UEA, UK, USA, USF etc

    Back in May the roundabout of changes at INTO University Partnerships (INTO) was in full motion.  My blog suggested a go to market strategy based around University Access Centers and an emerging sales structure reflecting the differing fortunes of Russell Group partners and other universities in the UK.  Particularly intriguing was the decline of the University of East Anglia joint venture (INTO UEA) and the rise of Queen’s University Belfast.

    Regular readers will has seen that INTO UEA then failed to file its 2020/21 Annual Report by the due date but it is now possible to confirm the extent of the continuing decline in enrollments.  The UAC strategy was duly launched, a new partner in the US gives some further sense of a possible direction and some familiar faces have returned while the top team continues to change.  A summary is timely.

    Changing UK Enrollment Dynamics

    For some time now it has become clear that changes in international student enrollment for the UK is making for unusual turbulence and may not be good news for pathway operators.  This year’s UCAS data shows that overall international acceptances at undergraduate level are down to their lowest level since 2015 (excluding the pandemic affected 2020) due to continuing declines in EU students.  As importantly for pathway operators the shift to Indian postgraduates as a dominant, growing market brings very different challenges after years of reliance on China.

    With the inclusion of the confirmed INTO UEA numbers the overall picture for INTO’s UK operations becomes clear.  While the Russell Group aligned operations had a steeper year on year fall in the most recent, pandemic affected, year the longer-term trend was positive.  Non-Russell group operations appear to be struggling and in decline.

    Note: Wholly owned subsidiary INTO Manchester is primarily aligned with the University of Manchester and is included in the Russell Group enrollments.  INTO World Education Centre is a “choice” option and included in the Non-Russell Group enrollments.

    The new figures also show that INTO UEA, the first joint venture opened, saw its enrollments fall below those of INTO Queen’s for the first time.  The recently posted Annual Report confirms that this decline came with an operating loss of £4.66m.  Note 18 of the Report indicates that fees charged by INTO and UEA to the joint venture have also been “renegotiated” to “reduce the LLP’s cost base.”

    The joint-venture’s problems have had an impact on UEA’s overall international student enrollment and a significant decline in international fee income.  For now, the partnership continues but it will be worth keeping a close eye on it over the coming year.  The direction of travel and hopes for recovery seem clear from the Annual Report with talk of “the expansion of year one pathways and Integrated Degrees” as the focus for the future. 

    Meanwhile, Back in the USA

    INTO’s declining joint venture portfolio in the US has been explored at length and the current court case with the University of South Florida will play out over time.  Court documents show that an “Emergency Motion for a Temporary Injunction to maintain the status quo” on 31 August was declined which is presumably what led to the joint venture being removed as a recruitment option.  Filings indicate the next steps are that “INTO USF LP and INTO USF, Inc. shall file their Amended Complaint on or before September 20, 2022, and USF Financing Corporation and The Board of Trustees of the University of South Florida shall respond to the Amended Complaint within twenty (20) days thereafter.”

    Meanwhile, the seemingly inevitable drive for direct recruitment partners may be coming with the announcement of an agreement to recruit postgraduate students for University of Massachusetts, Amherst from Fall 2023.  What is difficult to understand about INTO’s recruitment approach is that their student facing INTO Study website currently only features two direct recruitment partners (Colorado State University and Arizona State University) while the corporate site features nine US “recruitment partnerships”.  Shorelight’s site seems far more in keeping with the smooth approach that has been increasingly popularized by the aggregators and demonstrates how far INTO has to go if the intention is to have a significant direct recruitment network of partners in the US.

    If the Face Fits

    INTO’s web site constraints may also mean that updating new appointments and departures is not a priority but some of the comings and goings are interesting. 

    Particularly relevant to the next stage of US development may be the return of ex-North America MD/CEO David Stremba as Senior Vice President, Business Development.  He was pivotal to the early growth of INTO in the US and has spent some time with both Shorelight and Navitas in recent years, so should have a good sense of the competitor landscape.  The US structure is also developing with long-term player Yasmin Sefer becoming Senior VP, Partnerships (Private) alongside the Senior VP, Partnerships (Public), Steven Richman.

    The INTO corporate website also doesn’t reflect the recent departure of a Group COO and US Executive VP or a strongly rumoured, significant change at senior finance level.  All that aside, INTO seems to have decided the team and structure that it thinks can move it forward and there appear to be an ample number of “senior” titles for a business with a reported adjusted turnover of £119.3m in 2021.   Time for action.

    Image by Peggy und Marco Lachmann-Anke from Pixabay 

    An Englishman Abroad When The Queen Dies

    Being an ocean away when Queen Elizabeth II died was a reminder that some of the English certainties are well in the past.  In days gone by Thursday night would definitely have meant a trip to the pub to reflect on all things monarchical and to toast Her Majesty for a lifetime of service and putting up with her own children.  Whatever the general apathy or distaste for the Royal Family in the UK it was unusual for individuals to suggest she personally deserved less than respect for fulfilling a demanding role that was foisted upon her.

    As it is, the response of the football authorities has been to deny the opportunity for fans to meet at the weekend – a time that people come together to share loyalties, build memories and reflect on their world.  The most heartening moment of Thursday was the spontaneous rendition of God Save the Queen by West Ham fans gathered for a European league match.  People should have the chance to celebrate and sing with friends for those who have lived a fulfilled and fulfilling life.

    Cancelling the Last Night of the Proms was even more foolish because this is a moment where the British sense of tradition, eccentricity and ability to let loose in harmless patriotic fun is most evident.  Pomp and Circumstance March No1, Jerusalem and Rule Britannia are as much national anthems as the official version and the Queen was a believer in maintaining tradition.  The Royal Albert Hall, named out of love and enduring devotion to Queen Victoria’s husband, would have been a perfect venue to say goodbye while celebrating continuity.    

    I am personally three strikes down on opportunities to meet a member of the Firm but this is the first one that I definitely won’t get back.  It’s always seemed slightly odd to me that people want to stand in a line to shake hands with someone they don’t know, have nothing in common with and who might not even stop to talk.  Planning the choreography of the event, walking around with security details to review escape routes and sniffer dogs to check bathrooms for explosive devices, is a lot more interesting than two seconds holding a gloved hand.

    It is also fair to say that I am not a monarchist, although I have a regard for someone who so unflinchingly worked in a role that has meant being polite to some terrible Prime Ministers and appalling world leaders.  A long time ago I reconciled myself to the economic modelling suggesting that the monarchy was a net benefit to the country and that politically it was less likely to be problematic than, say, an elected President.  But I had no desire to meet – despite twenty years with a trio of close calls     

    As we set up the first ASDA Festival of Food and Farming in Hyde Park in 1989 one of the privileges of being the headline sponsor was to have our tent visited by the Queen.  As lead organizer for the retailer, I was on the list to have my hand shaken but declined because I wasn’t really sure what the point was.  I wandered around with one of the ladies in waiting who was totally charming and didn’t really feel I’d missed much.

    My next near encounter was in 2001 when Princess Anne opened the Sportspark at the University of East Anglia.  Like many people of my generation I considered the Princess Royal a favourite because she genuinely seemed to like rugby and didn’t have any of the somewhat whining tendencies of her brothers.  Another regal handshaking opportunity beckoned but I swiftly inserted my son into the running order to hand over a bouquet.

    Probably my final opportunity was when the then heir apparent, Prince Charles, visited the University of East Anglia in early 2010 to give a pep talk in the wake of Climategate.  His visit was delayed by several hours due to an accident on what was, at the time, only a single carriageway as the main road into Norfolk.  As dozens of security-cleared and locked down colleagues sweltered in the Council Chamber I had the right badge to go backwards and forwards which enabled me to be in the wrong place (had I wanted to shake hands) at just the right moment.   

    I’m not counting here the dismal It’s a Royal Knockout in 1987 where Andrew, Fergie and Edward made total idiots of themselves in the pouring rain and ushered in an era where dignity continued to fall away almost yearly.  Princess Anne was the fourth team captain but she looked on with disdain throughout, while strategizing her way to leading her team, including Emlyn Hughes and Tom Jones, to victory.  ASDA was one of the sponsors but we were, thankfully, kept miles away drinking champagne while watching on TV screens from a tent in a rain sodden field.

    All this is a reminder that a lot of years have passed for the “new Elizabethans”, a term which did not stick.  From a time when Winston Churchill was still Prime Minister and the monarch was Queen of the UK, Canada, Australia, New Zealand, South Africa, Pakistan and Sri Lanka, to a time when the Union is under pressure and the UK is seeking a new way in the world.  Her passing is probably the best reminder to those of us born in the decade of her coronation that the baton has firmly passed to new generations.

    In that respect it would have been interesting to see Charles – a product of the 1940s – step aside and help usher in a new generation through Prince William, a 1980s child.  It is not a question of whether King Charles can do the job because I suspect he will be more interested in stability than turbulence.  It is really whether the moment is ripe for a step change in ambition akin to that of John F. Kennedy, the youngest ever US President (by election) at the age of 43, whose New Frontier speech still resonates in stating “not a set of promises – it is a set of challenges.”

    Prince William is slightly younger than Kennedy was at that time but he has a young family that would make his appreciation of the long term future a matter of fundamental personal importance.  It also seems time for the generation born during and in the shadow of the second world war to hand over to those who will hopefully avoid a third.  After that they need only steer a route through climate change, global pandemics, economic poverty, water and food crises while watching the sky for a stray meteor.

    Despite all that, the best of luck to Charles and Camilla.  The country needs some good news and compassionate leadership.  They might just be the best thing about the next few years.

    Image by Alexa from Pixabay 

    INTO Court as Joint Venture Sours

    There are signs that INTO University Partnerships’ (INTO) relationship with the University of South Florida may be ending after a recent Court Evidentiary Hearing1 on 19 August 2022.  While no public record of a judgement has appeared, rumors suggest there are communications in circulation advising that enrollment to INTO University of South Florida (INTO USF) will cease.  If any authoritative source can provide an alternative explanation or clarification, I will be happy to correct any misunderstandings.

    It is appropriate to note that both INTO and the University of South Florida still feature INTO University of South Florida on their websites at the time of writing (27 August). The INTO Study site for students also offers the opportunity to apply for courses at the university. This may be the result of a time lag or the possibility of further discussion and this blog is written in good faith to explore the background to the Court case and the joint venture’s history.

    The underlying case for a university going to court to end a joint-venture pathway that was once among the most successful in the world deserves attention.  Publicly available court filings outline the case2 and material on the INTO Corporate and University of South Florida websites is used to summarize the history and other background about the joint venture relationship.  The source of further commentary is referenced through hyperlinks.  

    Summary of the Case

    A Court filing3 from USF Financing Corporation (USFFC) to the Thirteenth Judicial Court in and for the state of Florida Civil Division dated 15 July 2022 seeks a “declaratory judgment that the 2010 stockholders Agreement between USF FC, the Company4, and the INTO Defendants is terminated as of April 21, 2022.” The grounds are that the joint venture is “insolvent under both a balance sheet basis and inability to pay debts as they become due, and (b) has demonstrated a material adverse financial position where it could not perform all or a substantial part of its obligations..”.  The particular difficulties of pathway programs in the United States have been widely explored and the filing incorporates direct reference to my blog of February 2022 regarding the growing level of indebtedness of INTO’s US ventures.

    With an eye on its responsibilities for “stewardship of public resources” the University of South Florida terminated the program in April 2022 and “initiated the process for the teach-out of the programs’ enrolled international students….”  The filing asserts that “The INTO defendants refuse to acknowledge the Stockholders Agreement termination and refuse to participate in the teach-out or develop the Plan to dissolve and wind-up the Company.”  There are a number of points made around the fiduciary duty of the three INTO appointed Directors of INTO USF Inc, to creditors and shareholders “once a company is insolvent” with a memo, the accompanying Exhibit G of the filing, asserting that “the INTO appointed directors have a conflict of interest.”

    INTO University of South Florida

    INTO partnered with the University of South Florida in 2010 and the case study on the INTO website asserts “extraordinary” enrollment and economic impacts.  The accompanying graph (reproduced below) suggests that even if this was true up until 2016/17 the ensuing years have seen a significant decline in enrollment to the pathway.  Enrollments look to have peaked at around 800 but have subsequently fallen by around 100 a year to stand at c300 (this would be supported by the USF Fact Books showing non-degree seeking international students declining by a similar amount).

    Source: INTO Global.com

    The Court filing includes INTO USF, Inc’s Financial Statement to June 30, 2021 (Exhibit E) showing a net loss of $3.276m that year and $206,000 the year before.  This is supported by the USFFC’s Financial Statements to 30 June 2021 which comment on “approximately $3.3 million of net loss incurred by INTO USF during the year ended June 30, 2021.”  USFFC’s share of INTO USF’s “net accumulated (deficit)” was shown as $1.794m.

    As noted in the February 2022 blog “China Crisis for US Pathways”, since 2018 when INTO Illinois State University opened, “total level of indebtedness across all US operations has nearly doubled from £18m to £35m”.  This figure included the debts at institutions where joint ventures have now closed – Washington State University, Marshall University and Colorado State University.  The blog also reflects that INTO has become the 100% owner of what was previously a joint venture at St Louis University.

    One feature of both INTO USF (the second INTO partnership in the US) and INTO Oregon State University (the first) is that they are listed in INTO’s Annual Report as Inc. and are C-corporations.  Informed opinion suggests that closely held corporations (which these appear to be) “have been held to higher fiduciary duty standards” and this may be reflected in the “conflict of interest” comment.  Later US joint ventures are listed as LLC’s where, “By agreement, parties can alter certain duties to expand, restrict, or eliminate fiduciary duties owing to either the LLC or the other members and managers”, which suggests there may have been advice leading INTO to pursue alternative structures.5

    Summary

    It is worth waiting to see any Court judgement and whether there is an appeal process but the filing and other financial statements seem definitive in outlining the decline of the joint-venture’s financial situation.  If the joint venture is closed it would leave INTO with six joint ventures in the US, as well as the fully owned St Louis University operation and the “comprehensive partnership” with Hofstra (which is not listed in INTO’s annual reports as having joint ownership). 

    As well as the closures in the US there have been several INTO joint ventures shut down in the UK in recent years.  In addition, INTO has taken a controlling interest in the joint venture with Newcastle University and the financial arrangements at the joint venture with City University have changed.  As noted in a recent blog the yearly financial reporting for INTO University of East Anglia is shown at Companies House as overdue, for a joint venture under significant financial pressure.

    On top of all that there are rumors of imminent changes at the top in the INTO Finance team and the return of a familiar face to the INTO North America team but that is for another day.

    Notes

    1. Case number: 22-CA-006726 before Judge D.D. Farfante
    2. I am unaware of any written response by INTO University Partnerships to the case filed
    3. Filing#153460265 Efiled 07/15/2022 07:45:26 PM
    4. “the Company” is defined as INTO USF Inc which is the C-Corporation established in 2010 with stockholders USFFC and INTO USA LLC.  Its board has three nominees from INTO and three from USFFC.
    5. The purpose of this paragraph is to provide further information which may be relevant and the quoted elements comes from the source indicated.  There is no intention to give legal advice or guidance and readers are advised to seek appropriate counsel on company structures.

    Image by Venita Oberholster from Pixabay