William Blair Small Cap Growth Fund on Grand Canyon Education
Thesis
Grand Canyon Education provides online program management and shared services to higher education institutions under a revenue-share model linked to partner enrollment. The company posted better-than-expected results and favorable guidance, but shares weakened on fears that generative AI could disrupt higher education. The fund believes Grand Canyon's durable competitive offering, program expansion and campus growth can drive positive new enrollment and strong free cash flow. It added to the position during the quarter.
“We added to our position in the quarter.”
Key risks
- Potential disruption to higher education from generative AI