EduCap
| Company type | Nonprofit organization |
|---|---|
| Industry | Education finance |
| Founded | 1987 |
| Founder | Father John Whalen |
Area served | United States |
Key people | Catherine B. Reynolds (President) |
EduCap is a U.S.-based private nonprofit organization specializing in education financing, established in 1987. Its charitable counterpart is the Catherine B. Reynolds Foundation.
History
The surge in college tuition costs during the 1980s created a need for financial resources beyond what federal assistance programs could provide.
In 1987, Father John Whalen, a Catholic clergyman, initiated a nonprofit loan initiative aimed at helping students in the District of Columbia who were ineligible for government funding. The following year, Catherine B. Reynolds joined as comptroller and rebranded the entity as EduCap. Reynolds eventually assumed the role of President and successfully revitalized EduCap from financial distress into a nationwide private education loan provider. As reported by The Washington Post, she founded a for-profit branch named Servus Financial, which was a pioneer in securitizing credit-based private loans on Wall Street, marketing private student loans directly to consumers, and introducing education financing as an employee benefit.
In March 2000, Servus Financial was acquired by Wells Fargo Bank. Over a span of seven years, the foundation's original $60,000 investment expanded to several hundred million dollars. During that period, Servus Financial had issued approximately 350,000 private student loans.
Catherine B. Reynolds Foundation
Formed in 2001 and financed through proceeds from the sale of Servus Financial Corporation chaired by Catherine B. Reynolds, the Catherine B. Reynolds Foundation has contributed over $100 million to initiatives in performing arts, education, and community development.
Notable recipients include the D.C. College Access Program, the John F. Kennedy Center for the Performing Arts, the National Gallery of Art, National Portrait Gallery, Ford’s Theater Society, Dance Theatre of Harlem, the Blair House Restoration Fund, the National Geographic Society, the National Symphony Orchestra, N Street Village, Library of Congress, Marine Corps Scholarship Foundation, the MIT YouPitch Entrepreneurship Competition, Stanford Center on Longevity, the American Academy of Achievement, Reynolds Fellows for Social Entrepreneurship at NYU, and Harvard University.
In 2007, the Foundation supported The Museum of the Rockies’ excavation of a significant Tyrannosaurus rex fossil which was named Catherine after confirming it was female.
Catherine B. Reynolds
Businessweek magazine honored Catherine B. Reynolds as one of the 50 most philanthropic Americans currently living. She has held trustee positions at institutions such as New York University, Vanderbilt University, Harvard Kennedy School’s Center for Public Leadership, the John F. Kennedy Center for the Performing Arts, and National Geographic International Advisory Council. Under President George W. Bush’s administration, Reynolds served on the U.S. Secretary of Education’s Commission on the Future of Higher Education.
Her accolades include honorary degrees from Georgetown University, Morehouse College, and Willamette University as well as New York University's Gallatin Medal. In 2005 she received the Woodrow Wilson Award for Public Service and was recognized as a Washingtonian of the Year in 2011.
Reynolds is currently a board member at General Dynamics Corporation, Lindblad Expeditions LLC, and VitaKey Inc. In 2019, she was chosen by the Secretary of the Navy to sponsor the USS Jack H. Lucas—the first Flight III Arleigh Burke-class destroyer. In April 2020, President Donald J. Trump appointed her to the Great American Economic Revival Industry Group. Most recently, in October 2023, Washingtonian magazine listed her among its "Most Powerful Women in Washington."
Criticism
In 2003, Reynolds retracted a $38 million pledge to the Smithsonian Institution following disagreements concerning a proposed Hall of Achievement exhibit. Subsequently, her foundation allocated $100 million to the John F. Kennedy Center for the Performing Arts.
In 2007, The Washington Post highlighted concerns about EduCap's practice of imposing steep interest rates on borrowers with higher credit risk, as well as its possession of a corporate Gulfstream V jet.