Innovating his way out of a crisis

OldStoryImageNew Horizons owner Tim Broom and training manager Don PezetTim Broom’s horizon was short when the economy stumbled in the fall of 2008.
Students couldn’t get financing to take courses at his Gainesville franchise of New Horizons Computer Learning Centers. And the banks weren’t working with Broom either. He had a $150,000 deposit on a site for a new campus for the school, but he couldn’t line up a construction loan.

“I couldn’t get the students, and I wasn’t getting the financing,” he says.
Things might have seemed bleak, but rather than give up, Broom found innovative ways to survive. Now, two years after his crisis, his company has risen to become the top New Horizons franchise, receiving the Global Center of the Year award, as well as the Gainesville Area Chamber of Commerce’s award for business expansion.

Surviving the Crisis

When Broom realized his business was in trouble, he took several specific steps to straighten it out.
He appealed to get back his deposit. Broom had invested a $150,000 deposit in a parcel on Southwest 34th Street, where he planned to build a 20,000-square-foot, two-story building so he could expand the business. When it was clear he couldn’t get financing for construction, he went to the landowner.

“I had a come-to-Jesus meeting with John Pla,” Broom says. “God bless him. He gave my deposit back.”
He found a new revenue source. The next challenge was finding students who could afford New Horizons classes once banks pulled back on student loans. Broom discovered a Defense Department program that funds training for military spouses to help them develop “transportable” skills they can transfer from one location to another.

The problems? First, at that point, New Horizons didn’t offer classes in popular subjects that the spouses wanted, such as medical billing and pharmacy technician training. Second, many of the eligible military spouses were living at bases spread across the world.
Broom and training manager Don Pezet responded by developing a remote learning program and contracted with a company to deliver the courses.
New Horizons enrolled 150 students. Unfortunately, the military offered funding for only 75 days at that time. But the cash infusion that the funding provided helped New Horizons survive. And, Broom says, “This opened our eyes to remote learning. All of a sudden, we started wondering why we couldn’t develop our own classes that could be delivered remotely.”

He created his own student loans. Even with the new program under development, Broom needed to solidify his company’s bread and butter business—helping students earn certification as Microsoft, Cisco and Adobe IT experts.
With banks unwilling to lend, the enterprising Broom created his own financing company, Mary Mae Financial, with the help of Jim Hill, his business development manager.
“Jim put together a group of investors, who got us started,” Broom says. “We’ve done well with students making payments, and the investors are getting a good return on their money.”

Breaking Out of the Mold

All those steps, plus Broom’s move to a larger space in a rehabbed building, helped solidify the business. But a shift into the latest in high-tech instruction is what’s really propelling the business now.
Typical for Broom, he made this shift in response to a problem he encountered. He wasn’t satisfied with the New Horizons company’s online courses because they worked like webinars, with students unable to interact with or see the instructors.
“Classes should be engaging,” Broom says.

So he and Pezet built an online presence that engaged students as if they were in a classroom together. “We combined the best features of four to five off-the-shelf computer instruction programs to develop a superior program,” Broom says.
Their system allows students not only to see their instructors but also to see each other and view each other’s work. “It’s like a teacher calling the class to come over and show everyone what a student is working on,” Broom says.

The new program has proven so popular that Broom already has expanded from one studio to three.  And he’ll soon be adding three more to teach a master’s degree in digital interactive media in cooperation with the University of Florida’s College of Journalism and Communications.
Brooms credits Pezet with being the genius behind the online training program. “He’s a rock star who has experience in a variety of settings including working for the Florida Farm Bureau and Home Street Bank in Seattle,” Broom says.

Moving Forward

New Horizons now teaches about half of its courses online, including courses for students outside the area.
Broom is reaching out to students in South Alabama, an area in which no New Horizons franchise exists, and he has opened offices in Tallahassee and Pensacola. In addition, he’s offering his curriculum to the 300 other New Horizons locations spread over 60 countries.
As the business grows, Broom says he’s focusing on quality. “We continue to maintain our student-teacher ratio of less than 20 to one,” Broom says.
Having high-quality instructors is essential too, Broom says. “The high evaluations our instructors receive is the main reason we won the Global Center of the Year Award,” Broom says.

Graduate Walt Bratcher says the skilled instructors were key to him. “They knew what they were talking about and were able to give examples of real-world experiences.”
New Horizons continues to teach classroom courses at its building, but Broom wonders how long the physical classrooms will be necessary. “Our classrooms are becoming dinosaurs,” he says.

Thanks to all the successful changes, New Horizons’ revenue grew 83 percent in the 2009-2010 fiscal year. That’s just the beginning. The new online curriculum that training manager Pezet has developed has unlimited potential to attract new students, Broom says.
The increased volume may even allow Broom to lower tuition. “If I can double my average enrollment in a class from eight to 16 students, I’ll have more economy of scale, and I can pass on some of the savings to students,” he says.

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