NASDAQ: STRA STRAYER EDUCATION, INC.

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Operations Overview

• Scott W. Steffey
• Executive Vice President and
• Chief Operating Officer

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Strayer University Working Adults

• Founded in 1893
• 14,000 students
• Accredited by Middle States
• Educational standards ensured by strong academic
  structure
• Board of Trustees
• President
• Academic Dean/Provost
• Dean of Graduate Studies
• Campus Deans

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Strayer Locations

• 17 physical campuses expanding into neighboring
  states
• Strayer ONLINE classes offered worldwide

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Four Operating Divisions

• Maryland Region Prince Georges, Montgomery,
  Anne Arundel, White Marsh Owings Mills
• Northern VA/DC Region Washington, Takoma Park,
  Arlington, Woodbridge, Manassas, Loudon
• Southern VA Region Fredericksburg, Henrico,
  Chesterfield, Chesapeake, Newport News, future
  North Carolina Sites
• ONLINE Headquartered in Newington, VA

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Campus Model

• Campus Dean
• Academic responsibility for the campus
• Faculty, adjuncts, scheduling, student
  counseling, registration support, evaluations and
  academic committees
• Reports to Provost
• Campus Manager
• PL responsibility for the campus
• Admissions officers, student services, lab
  monitors, learning resource center, and
  facilities
• Reports to Regional Directors

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Educational Statistics

• Graduation Rates
• Full-time 70
• Senior Class 83

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Academics

• Student Mix
• Diploma 5
• Associate 19
• Bachelor 64
• Master 16
• Non-program 6
• Classes Taught
• Full-time faculty 46
• Part-time faculty 54

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Funding a Strayer Education

• 45 Receive Title IV funding
• 7 Receive ELP funding
• 20 Direct corporate payments
• 28 Self payment

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New Campus Model

• Target average student growth rate at year end
• 1st year 150 students
• 2nd year 300 students
• 3rd year 450 students
• 4th year 600 students
• 5th year 750 students
• 6th year 900-1,000 students

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Mature Campus Model

• 21,000 square feet
• 16-18 classrooms that can accommodate 20 to 40
  students per class
• 4-5 computer labs one open lab, Cisco lab,
  teaching lab, networking lab
• 1,200 students is historic mature capacity

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Site Selection Strategy

• Identify target cities and assess regulatory
  hurdles
• Review demographics, population trends,
  employers, competition, educational attainment
• Map target population and commuting patterns,
  survey available facilities
• Accommodate growth phases

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Accelerated Enrollment Growth

• Divided Company into four regions and added
  regional support staff more detailed management
  oversight and support
• Added admissions officers at select campuses
• Implemented goals for conversion rates,
  personally developed leads, and continuing
  students
• Improved low cost outreach and student services
• Targeted training every term, on-the-spot
  training as necessary
• Daily review of enrollment and marketing data

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Marketing Overview

• Marketing sources include referrals, the
  Internet, direct mail, newspaper, T.V., outreach,
  radio, yellow pages, and outdoors
• Telephone responses are routed directly to
  campuses and distributed by the manager
• Walk-ins and Personally Developed Leads go
  directly to campus
• Direct mail and the Internet are distributed by
  marketing

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Marketing Improvements

• Sharpened focus on working adults
• More targeted marketing
• Improved monitoring of leads
• Improved actionable data on marketing sources,
  aging of leads, and conversion rates
• Improved ability to respond mid-cycle to market
  conditions
• Improving branding and messaging
• Reinvigorated Curriculum Advisory Board

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Marketing Costs

• Cost per lead below 100
• Student acquisition 500 - 650
• Some softening of advertising rates

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Corporate Alliances

• Potential large recurring volume
• Minimal credit risk
• Career benefits
• Faculty

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Tuition

• Undergraduate Courses
• 1 class 1,039.50
• 2 classes 2,079.00
• 3 classes 2,976.75
• 4 classes 3,969.00
• Graduate Courses
• 1 class 1,323.00
• 2 classes 2,646.00

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Mature Campuses

• 11 campuses in operation over 3 years
• 10,809 students
• 2 enrollment growth Fall 2001 vs. decline Fall
  2000
• 99 full-time faculty, 320 adjuncts
• Facility capacity of 2,000 students

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New Campuses

• Six new campuses in operation 3 years or less
• 1,169 students
• 40 enrollment growth Fall 2001
• 6 full-time faculty, 50 adjuncts
• Work closely with ONLINE
• Start-up capital expenditures 500,000 to
  1,000,000(leasehold improvements, computer fit
  out)

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ONLINE

• In operation since 1997
• 2,766 full-time ONLINE students
• 80 enrollment growth over last fall
• 12 full-time faculty, 86 adjuncts
• Approximately 245 courses offered this quarter,
  18 asynchronously 54 asynchronous planned for
  winter

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New Certificate Programs

• Graduate Certificate
• Management
• Accounting
• Computer Information Systems
• Marketing
• Human Resource Management
• Controllership
• Taxation
• Accounting Information Systems
• Communications Technology

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New Certificate Programs

• Undergraduate Certificate
• Acquisition and Contract Management
• Introductory Accounting
• Advanced Accounting
• E-Business
• Small Business Entrepreneurship

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Legislative and Regulatory Compliance

• Loan default rates for FY 99, 98, 97
  respectively were 5.6 12.1, 14.5
• Middle States post transaction six month review
  successfully accomplished
• Application pending for up to nine sites in North
  Carolina (2-3 in 2002)
• H.R. 1992, incentive payment legislation
  proposed House changes would be favorable (Senate
  to consider in 2002)
• Sally Stroup (formerly of Apollo) nominated to
  Assistant Secretary of Education for
  post-secondary education

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Academic Overview

• Chris Toe
• Strayer University Provost

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Agenda

• Student/Faculty profile
• Academic programs
• The Strayer Education experience
• What our students say about us

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Student/Faculty Profile

• Student profile
• Highly motivated and demographically diverse
  average working adult student is 33 years old
• Faculty
• Full-time 117 Adjunct 456
• All full-time have graduate degrees
• Significantly diverse
• Teach, advise students, develop programs and
  curricula, and render professional and community
  service
• Subject-area expertise

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Academic Programs

• Graduate programs prepare students for
  upper-level management and technical positions
• Undergraduate programs prepare specialists/general
  ists
• Diploma programs aid early-entry into job market
• Certificate programs feed degree programs or
  provide additional skills
• Minors help B.S. students develop additional
  expertise in a second field

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Academic Programs

• Graduate
• Master of Science
• Business Administration
• Communications Technology
• Information Systems
• Management Information Systems
• Professional Accounting
• Executive Graduate Certificate Programs
• Business Administration
• Computer Information Systems
• Professional Accounting

denotes a new program this year
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Academic Programs

• Undergraduate
• Bachelor of Science
• Accounting
• Business Administration
• Computer Information Systems
• Computer Networking
• Database Technology
• Economics
• International Business
• Internetworking Technology

• Associate in Arts
• Accounting
• Acquisition and Contract Management
• Computer Information Systems
• Computer Networking
• Database Technology
• Economics
• General Studies
• Internetworking Technology
• Marketing

denotes a new program this year
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Academic Programs

• Diploma Programs
• Accounting
• Acquisition and Contract Management
• Computer Information Systems
• Internetworking Technology
• Network Security
• Web Development

denotes a new program this year
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Academic Programs

• Minors
• Accounting Accounting Information Systems
• Business Management E-Business Human Resource
  Management International Business Marketing
  Small Business Management Entrepreneurship
  Economics Finance
• Computer Information Systems
• Networking (NT)
• Networking (Windows 2000)
• Internetworking Technology

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Academic Programs

• Undergraduate Certificates
• Accounting
• Business Administration
• Computer Information Systems

denotes a new program this year
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The Strayer Education Experience

• Time to completion
• Diploma 6 quarters
• Associates 11 quarters
• Bachelors 21 quarters
• Masters 9 quarters

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The Strayer Education Experience

• Curriculum development and the
• Curriculum Advisory Board
• Students, faculty, staff, administrators and
  employers provide suggestions
• Faculty committees research and develop
  suggestions into programs and/or courses
• Academic administrators ensure consistency with
  academic standards and mission, market demand,
  and availability of resources
• Employers and external constituencies constitute
  Advisory Board

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What Our Students Say About Us

• Decision to come to Strayer based on its
  flexibility, caring attitude, scheduling,
  personal attention, convenience for working
  adults, and learning resources
• Perception is verified by good programs and
  services that match career-related needs
• Professors are well-informed, knowledgable,
  personally committed - in a word, prepared
• Professors are accessible and helpful
• Provides hands-on, career-focused convenient
  education for working adults

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What Our Students Say About Us

• Approximately 20, of total leads each quarter
  come from referrals
• Quarter-over-quarter continuing rates are rising
  and more students are staying or returning for
  additional credentials

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Regional Operations Overview

• Jim McCoy
• Regional Director
• Southern Region

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Agenda

• Overview of Strayer Southern Region
• Two Strayer campus case studies
• Plans for North Carolina expansion
• Articulation agreements

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Overview of Southern Region

• Fredericksburg, VA
• Henrico, VA
• Chesterfield, VA
• Chesapeake, VA
• Newport News, VA

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Fredericksburg, VA Campus

• Demographics
• Established in 1992, located 40 miles south of
  Washington, D.C.
• Population of the Fredericksburg area has grown
  57 since 1990
• Population in the area between the ages of 25 and
  49 is 97,000, of which 79 do not possess a
  bachelors degree

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Fredericksburg, VA Campus

• Current campus staffing model
• 16 Full-time campus administrative personnel
• 5 Full-time faculty members
• 25 Adjunct faculty members
• Major employers in the area include
• Computer Science Corporation
• Quantico Marine Base
• Capital One

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Newport News, VA Campus

• Demographics
• Began operations in Fall 2001 second campus
  established in Hampton-Roads area of Virginia
  located in Oyster Point business park, a rapidly
  growing area comprised of government and private
  industry
• Newport News is home to over 151,000 residents
  between the ages of 25 and 49, of which 78 do
  not possess a bachelors degree

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Newport News, VA Campus

• The 21,000 sq. ft. facility includes 16
  classrooms and computer labs, with the capacity
  to serve 2,000 students
• Initial enrollment figures are in line with
  Strayers expectations for a new campus

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Newport News, VA Campus

• Current staffing model includes
• 8 Full-time administrative personnel
• 6 Adjunct faculty members
• Major employers in the area include
• Cannon
• Fort Eustus
• Langley AFB
• Newport News Shipbuilding
• Jefferson Laboratories

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Plans for North Carolina Expansion

• Consistent with growth strategy
• Favorable demographics
• 2-3 campuses planned in 2002
• Ultimately, we believe the North Carolina market
  will be as large as Maryland and Virginia for
  Strayer

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Articulation Agreements

• Community Colleges
• Germanna Community College
• Rappahannock Community College (22)
• Virginias vast Community College System affords
  many additional opportunities for Strayer

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Campus Operations Overview

• Kristin Jones
• Campus Manager - Henrico, VA

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Agenda

• Administrative organization
• Academic organization
• Review of key departments
• Daily campus activities
• Community relationships

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Administrative Organizational Chart
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Academic Organizational Chart
Strayer Campus
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Review of Key Departments

• Academics
• Teaching and instruction
• Course scheduling
• Academic advising
• Faculty recruitment and assignment
• Student retention efforts
• Academic curriculum

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Review of Key Departments

• Admissions
• Recruitment/registration
• Community outreach
• Student services
• Accounts receivable/payable
• Student aid programs
• Library and computer lab resources
• Facility maintenance

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Daily Campus Activities

• Daytime
• Recruitment/retention
• Collections activities
• Student use of facilities
• Daytime courses (Traditional/ONLINE)
• Supplementary facility usage

• Evening
• Evening courses (Traditional/ONLINE)
• Student use of facilities

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Community Relationships

• Sponsor annual scholarships to local high school
  students
• Develop partnerships with local businesses and
  organizations
• Participate in outreach events
• College fairs
• Technology fairs
• Career fairs

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Marketing Overview

• Lysa Hlavinka
• Vice President/Marketing and
• Public Relations

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Agenda

• 2001 marketing activities
• Corporate alliance overview
• Corporate sponsorships to date

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2001 Marketing Approach

• Focus on results
• Conversion rates lead to new student
  cost per lead is the lowest in the
  industry
• Conversion time frames
• Increase campus accountability for accurate lead
  sources and add passive tracking of lead sources
  where possible
• Implement quarterly and annual marketing plans
• Refine message and add consistency to advertising

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Direct Mail

• Generates the largest number of leads for Strayer
  University, consistent with the industry
• Move from saturation strategy to targeted list
  strategy
• Measure results and implement more of what works

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Internet

• Much heavier emphasis has been placed on the
  Internet during the second half of 2001
• Significant increase in number of new students
  sourced to the Internet
• Expanded use of Internet marketing options
  including email marketing arrangements
• Tracking is easy, fast, and accurate

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Broadcast

• Maintain television strategy with slightly
  revised goals
• Adjust timing of radio and television
  advertisements to make better use of budget and
  to be more consistent with state-of-the-industry
  practices

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Print

• Refine newspaper advertising strategy to include
• Major market papers
• Special sections
• Begin to test more lead-generating advertising in
  newspapers (inserts)

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Continually Refine Strategy

• Conduct focus groups with current and prospective
  students
• Ongoing competitive analysis

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Corporate Alliances Overview

• Develop preferred educational sponsorship
  arrangements with corporate, government, and
  military organizations
• Articulation agreements
• Provide content for ONLINE corporate universities
• Preferred placement in corporate intranet to
  attract additional students
• Custom development of courses and programs
• Tuition assistance programs
• Offer on-site courses
• Information and recruiting events at companies,
  military bases, etc.
• Sponsorship arrangements with educational
  organizations
• Articulation agreements to attract students
  seeking to earn progressively higher degrees
  (e.g. Associates to Bachelors)

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Successes to Date

• New contracts (past quarter)
• Computer Sciences Corporation
• EDS
• Navy Auditor General
• UPS
• Corporate Sponsors, over 80 companies including

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Technology Overview

• Kevin OReagan
• Vice President and
• Chief Technology Officer

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Agenda

• Enterprise campus technology
• ONLINE technology
• Technology security

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Enterprise Technology
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Enterprise Technology Highlights

• Scalable - extremely cost effective
• New campuses
• Bandwidth very expandable
• Reliable
• High performance
• Secure
• Full support

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Enterprise Technology Providers
IBM
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Campus Technology
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Campus Technology Highlights

• Proven, cost effective, cookie-cutter model
• Custom-built labs to support educational
  objectives
• Standard software images for reliability
  support
• Enterprise standards, local support

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ONLINE Technology

• Technology supports two course content delivery
  and student participation models
• Synchronous (realtime)
• Asynchronous (anytime)
• Minimal technical requirements for student
• Extremely competitive with other universities
  ONLINE course offerings

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Synchronous Technology Providers
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Synchronous Technology Highlights

• Real-time
• Interactive
• Collaborative
• Dynamic
• Archive capability
• Teaching stations
• Tech support

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Asynchronous Technology Providers
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Asynchronous Highlights

• Proven technology partners
• Combination of in-house outsourced offerings
• Multiple suppliers
• Rapid scalability
• Convenience for students
• Leverage ONLINE infrastructure
• Tech support

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Technology Security

• Critical requirement
• Stringent security policy
• Security methods
• Account-ID, password
• Encryption of sensitive data
• SSL (Secure Socket Layer)
• Enterprise firewall protection
• Private IP
• Enterprise anti-virus

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Strayer ONLINE

• J. A. Anderson, Sr.
• ONLINE Academic Dean

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Agenda

• A network of learning opportunities
• Synchronous courses
• Asynchronous courses

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A Network of Learning Opportunities

• Traditional, fixed-facility locations
• An expanding number of locations convenient to
  the working adult
• ONLINE synchronous courses
• Live, scheduled classes supported by individual
  course web sites
• ONLINE asynchronous courses
• Weekly instructional units supported by
  individual course web sites

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ONLINE Synchronous Courses

• Built around scheduled, live class sessions
  real-time spontaneous interaction between
  instructor and students
• Instructor audio broadcast
• Class chat discussion
• Breakout group chat discussion
• Final exams proctored

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ONLINE Synchronous Courses

• Each course has supporting static web pages
• Students use a single university userID/password
• Web pages provide
• Content items--lecture slides/ notes, external
  links, syllabus, assignments
• Communication tools-- email, announcements,
  group chat rooms, discussion forums
• Utilities--file upload, grade book, online testing

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ONLINE Synchronous Courses

• Students log in to a course lobby to access live
  events (class) or view class archives
• Students can check their PC for connectivity to
  class
• Classes are presented using slides, free-hand
  white board, pop-up web pages, and images
  projected from the desktop
• Instructors communicate with audio and chat
  students respond in chat
• All class activities are archived

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ONLINE Asynchronous Courses

• Weekly instructional units
• Students and instructors interact asynchronously
• Final exams proctored

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ONLINE Asynchronous Courses

• Each course has supporting pages constructed into
  weekly units
• Supporting pages provide
• Content items--recorded lectures, graphics,
  external links, syllabus, assignments, audio
  supplements
• Communication tools--email, announcements, group
  chat rooms, discussion forums, journal
• Utilities--file upload, grade book, online
  testing, chat office hours

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ONLINE Asynchronous Courses

• Each weekly unit contains several activities for
  students to complete or participate in
• Recorded audio/graphics lecture
• Readings/ links to web resources
• Discussion board dialogue
• Quiz/ problem sets/ projects

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Financial Overview

• Mark Brown
• Senior Vice President and
• Chief Financial Officer

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Agenda

• Q3 Financial Highlights
• The Strayer PL
• Bad Debt/DSO
• Shares Outstanding/EPS
• New Campuses
• Capital Expenditures
• Q4 and 2002 Guidance

All forward looking information is subject to
significant risks and contingencies. See Strayer
Education SEC filings for additional information.
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Financial Highlights - Third Quarter
(amounts in 000s, except per share)

• For the Three Months Ended
• September 30,
• 2000 2001 change
• Revenues 14,691 18,222 24.0
• Income from
• operations 2,191 2,744 25.2
• Operating margin 14.9 15.1
• Investment other
• income 1,227 548 (55.3)
• Fully diluted per
• share 0.14 0.14 2.3

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Financial Highlights - Nine Months
(amounts in 000s, except per share)

• For the Nine Months Ended
• September 30,
• 2000 2001 change
• Revenues 56,144 65,592 17.0
• Income from
• operations 21,047 23,465 11.5
• Operating margin 37.5 35.7
• Investment other
• income 3,241 3,407 5.1
• Fully diluted per
• share 0.96 1.10 15.6

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The Strayer PL

• Revenue
• Instructional and educational
• Selling and promotional
• General and administrative
• Investment and other income
• Income tax

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The Strayer PL

• Revenue
• Instructional and educational
• Selling and promotional
• General and administrative
• Investment and other income
• Income tax

• Tuition
• Fees
• ELP Income

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The Strayer PL

• Revenue
• Instructional and educational
• Selling and promotional
• General and administrative
• Investment and other income
• Income tax

• Deans
• Professors
• Academic Assistants
• Facilities
• Equipment

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The Strayer PL

• Revenue
• Instructional and educational
• Selling and promotional
• General and administrative
• Investment and other income
• Income tax

• Advertising
• Campus Managers
• Admissions
• Marketing Dept.

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The Strayer PL

• Revenue
• Instructional and educational
• Selling and promotional
• General and administrative
• Investment and other income
• Income tax

• Campus Student Services
• Bad Debt
• Corporate HQ

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The Strayer PL

• Revenue
• Instructional and educational
• Selling and promotional
• General and administrative
• Investment and other income
• Income tax

• Mostly Interest

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The Strayer PL

• Revenue
• Instructional and educational
• Selling and promotional
• General and administrative
• Investment and other income
• Income tax

• 39 effective rate

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Bad Debt
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DSOs
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2001 Shares Outstanding/EPS
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New Campuses
A new campus is typically profitable after 5-6
quarters of operation
2002 Impact of 3 New Campuses (amounts in
millions, except enrollment data)
Student Quarters 375 Revenue 0.4 Instructional
Staff Cost (0.8) Marketing (1.3) Facilities
and Other (1.0) Operating Loss (2.7)
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2002 Estimated Capital Expenditures
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Outlook for Q4 and FY 2002

• Q4 2001
• 0.43 to 0.45 fully diluted EPS
• FY 2001
• Upper end of 1.50-1.55 range
• FY 2002
• 108 -112 million revenue
• 34 - 35 operating margin
• 1.71 to 1.75 fully diluted EPS

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Operating Margin

• Operating Margins are expected to be lower in the
  first half of 2002 vs. 2001
• Impact of 3 campuses added in 2001 which are not
  yet at breakeven
• Investment in management team and admissions
  staff did not begin until Q2 2001
• Versus 2001, Operating Margins should improve in
  the second half of the year
• New 2001 campuses begin to provide lift
• Begin to leverage investment in management and
  infrastructure

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Summary

• Robert S. Silberman
• President and
• Chief Executive Officer

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Strayer Growth Strategies

• OBJECTIVE Stabilize shrinkage in mature campuses
  while maintaining high academic standards
• UPDATE
• Mature campus growth
• Q2 2
• Q3 4
• Q4 2
• Middle States successful reaccredidation

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Strayer Growth Strategies

• OBJECTIVE Accelerate rate of growth of new
  campuses to 2-3 per year
• UPDATE
• 3 campuses opened n 2001
• 2 Virginia
• 1 Maryland
• Application made to North Carolina for 2002

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Strayer Growth Strategies

• OBJECTIVE Expand ONLINE
• UPDATE
• ONLINE growth
• Q2 75
• Q3 102
• Q4 80
• Asynchronous rollout

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Strayer Growth Strategies

• OBJECTIVE Increase Corporate and Institutional
  Alliances
• UPDATE
• 4 additional corporations/institutions added in
  Q3
• Corporate direct reimbursements have maintained
  20 share of revenue, as revenue growth
  accelerates

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Strayer Growth Strategies

• OBJECTIVE Continue to be a leader in serving
  International students
• UPDATE
• Strong growth in ONLINE participation
• Expect flat growth in F-1 student participation

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Strayer Growth Strategies

• OBJECTIVE Look selectively at potential
  acquisitions
• UPDATE
• Maintained internal focus during first six months
• Will be more active in latter stages of the
  planning cycle

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Investment Thesis

• Strong, growing, resilient industry
• Excellent platform
• High sustainable operating margins
• No debt
• Focused on most attractive market segment
• Committed, dedicated management team

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