Going To The Head Of The Class

June 24, 2002
| By Katy Rent |
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GRAND RAPIDS — One of the fastest growing private companies in America is a Grand Rapids-based education management firm, according to figures compiled by Inc magazine.

At the end of October, the magazine put out its annual Inc 500 list, and landing at No. 19 was National Heritage Academies.

This was the first year on the list for the charter school management company and it demonstrated why by achieving 7,094 percent revenue growth in the past five years, making it the fastest growing privately held company in Michigan, and the only company listed in the education industry.

“I think it’s an exciting award and it really is a testament to the success of the organization and all the people that make the company grow and make our schools grow,” said Pete Ruppert, president of National Heritage Academies. “And it is a sign that the charter school movement is growing because a company like ours, which wasn’t in existence six years ago, is now the 19th fastest growing privately held company.”

The company, which operates 28 public charter schools with nearly 14,000 students in Michigan, North Carolina and New York, also has seen a growth in enrollment of 22 percent over the past year and 7,945 percent since opening its first school in Michigan in 1995.

“The reason we have been able to achieve this revenue and enrollment growth is because our people are doing such a great job — and parents love our schools, love our teachers, our facilities and our programs,” Ruppert said.

Since its start in 1995, National Heritage’s revenues have increased from $682,000 in 1996 to $49.1 million in 2000 and are expected to approach $100 million in this fiscal year ending June 30, 2002. The company’s employment also has grown rapidly: from 11 people in 1996 to 1,047 in 2000. Current employment across the company now tops 1,400.

“This listing is also exciting from a business perspective — not only does the business plan work, but as a company we have been able to manage the addition of more schools and classrooms and more employees to deliver an outstanding product, not just at one school but at multiple locations, not just in Michigan but in North Carolina and New York,” said Ruppert.

The privately held companies were judged and researched this year by a group of 10 individuals from Inc magazine, and they selected all 500 companies based on the same set of criteria. Three basic standards had to be met:

  • Be an independent, privately held corporation, proprietorship or partnership. Regulated banks, utilities and holding companies were excluded.

  • Have had sales of at least $200,000 in 1996.

  • Have a five-year operating or sales history that included an increase in 2000 sales over 1999 sales.

After meeting these three criteria, companies were ranked based on the company’s percentage increase in sales from 1996 through 2000. Applicants had to submit completed qualification forms and documentation of sales as of May 7, 2001.

Sales figures were verified using the companies’ tax returns and financial statements (audits or reviews prepared by an outside accountant or auditor) for 1996, 1999 and 2000. Companies were measured by growth in sales, based on the rate of growth over the last five years. The data published goes back to fiscal year ending July 30, 2000.

While Grand Rapids Public Schools closed schools recently due to loss of students and revenue, charter schools are, on the whole, seeing an influx of students. “You are seeing the increasing popularity of schools like ours. What happens is that parents enroll their kids, go tell their friends and they come and enroll their kids. The majority of what you are seeing is coming from public schools, because we can offer something different for each parent and that is what they are looking for — something they can’t find in their public school,” said Ruppert.

“We feel we have four key components to our success, and the first one is a rigorous academic program where we really challenge kids academically to achieve their greatest potential. Secondly, we have what we call moral guidance or character development — there are some universal virtues, base values, beyond religion, that any good person should have or strive to be.

“The third piece is the commitment we have in partnering with parents. We want them heavily involved, at school or at home, (and) we do our best to even require that they commit to their child’s education. The last piece is accountability, and we hold everyone accountable to educating kids and meeting the needs of children.”

Ruppert said that a key component as to why National Heritage Academies was listed among the Inc 500, and why it has been so successful, is based on the fact that the company works to create a school based upon what parents want for their children’s education. “We started out and we said, ‘What would a parent want for their children’s education in a grade school?’ So when you create schools with your customers in mind, you are bound to succeed.”  

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