Dan Coleman left KCG after it was acquired by Virtu Financial and moved back to Birmingham, Alabama to contemplate his future. He reached out to a local college, Birmingham-Southern, whose board he once served on. Little did he know he would soon end up as its president.
While waiting for the Virtu deal to close, Coleman called the college and asked what was going on there. This led to a conversation during which he was hired as a college professor teaching investments. He dove into the text book for the class and found it was the same one he had studied in 1993 when he was an undergraduate. Coleman sensed that some of his knowledge was out of date and decided to take a class in computer programming using Python, as well as one in mathematics. In the spring he took more Python and actuarial math, a subject he wishes he had studied earlier, he said.
Coleman was then asked to rejoin the board, which he had left years earlier when his Wall Street schedule did not allow him to make the board meetings. He accepted, making him a board member, faculty member and student, something he said probably broke a law somewhere.
Within six weeks of rejoining the board, the Birmingham-Southern president resigned, and the board approached Coleman about taking over the role. He accepted, seeing it as an opportunity to help his hometown and restore the college’s financial stability.
Birmingham-Southern College, a liberal arts institution with a rich history dating back to 1856, faced significant financial challenges. Coleman said for many years the college has been considered the best in the state. In the year 2000, the college had a $130 million endowment and $20 million in debt, but by 2012, the debt had ballooned to $68 million and the endowment had dwindled to $48 million after a new college president had embarked on a campus building program to attract new students.
Coleman said Birmingham-Southern needed a substantial endowment to ensure its long-term financial stability, citing examples from other liberal arts colleges with large endowments. He said several colleges he examined showed a reasonable draw on their endowment covering 20 percent of their operating expenses. Colleges that can’t cover 20 percent of expenses were colleges in trouble, he said. He began a fundraising campaign, but met resistance from supporters upset with the college. Coleman ended up setting up a separate foundation to hold the funds, out of the reach of the college president. And while Covid-era funds helped the college, Coleman realized he was running out of time as his fundraising efforts were falling short.
Coleman tried to secure financial support from various sources, including foundations and government entities. His efforts to get help from Senator Richard Shelby of Alabama were met with disappointment. He was directed to try to get money from the state. He ended up having a bill passed to get a loan from the state, which the governor signed. However, the governor dragged his feet on having the state treasurer release the funds, leaving Coleman and the college to seek other alternatives.
Coleman has talked to foundations and explored mergers with other colleges, but does not believe a merger offers a viable solution.
One intriguing possibility he discussed was the idea of partnering with the University of Austin, a new institution with a focus on challenging elite colleges and universities. Coleman envisioned a scenario in which investors could help Birmingham-Southern College transform into a more efficient and modern institution. This transformation would include a strong core curriculum in math, statistics, programming, and data science, along with small, tutorial-style classrooms emphasizing critical thinking and free speech. Coleman said he knows some people have canceled more gifts to Ivy League schools than what he needs to make his idea work.
Coleman said he believed that higher education needed to adapt to the changing world and that a reimagined Birmingham-Southern College could provide a unique and valuable educational experience. He said he hoped to find donors who shared his vision and were willing to invest in this transformation.