“We put our heads together and some money together and said, ‘We think we can do it better together,’” Shaut says. “I had a piece of the business, and he had a piece of the business ... It was really his strengths and my strengths put together from a marketing and financing and customer service perspective.”
The result, Education Lending Group, is a specialty finance company principally engaged in providing student loan products, services and solutions to students, parents and schools.
What makes Education Lending Group stand out from the competition is the fact that it is vertically integrated everything is done in-house.
“Most of the competitors in the marketplace, except a handful, are not vertically integrated,” Shaut says. “They don’t do their own servicing; they outsource that to third-party providers. And we concluded that to really be a player and a force in the industry we needed to be vertically integrated and that’s where we have several-hundred employees down in Cleveland that service our loans, both originate them meaning they take the applications, process the applications and disburse the funds for the loans and then collect the loans and manage them going forward in terms of customer service, status and things like that.”
Being vertically integrated has allowed the company to grow at a rapid pace, and Shaut took it public in 2003.
In 2005, Education Lending Group was acquired by CIT Group, which provides the company with the resources to further accelerate its growth. With the help of its parent company, Shaut says it won’t be long before his company becomes one of the top lenders in the nation.
“We’re going to be in the top three lenders in the nation in the next couple years,” Shaut says. “We should break into the top 10 shortly, if not this year, and then the top five before the end of the decade.”
HOW TO REACH: Education Lending Group, (216) 706-7444 or www.edlending.com