Wall Street tried getting into higher education. Disaster ensued.

Sébastien Thibault fo BI

In the early 2000s, the business of for-profit college was booming. After the University of Phoenix's parent company, the Apollo Group, went public in 1994, others were close on its heels: Corinthian, ITT Tech, and Kaplan each had IPOs in the 1990s, netting tens of millions of dollars and setting off tremendous periods of growth.

Soon, private equity firms caught wind of the opportunity. In 2003, there were just 18 for-profits owned by private equity firms; less than a decade later...