According to 2001-2002 demographic data taken from Capella’s Distance Education Demonstration Program Annual Reporting Form, submitted to the Department of Education, the average age of a Capella learner is 40 years young, and its student population is comprised of 58 percent female and 26 percent ethnic minorities. Its overall retention rate, which varies by level of study, according to Capella President Mike Offerman, is in the 65 percent range. (Offerman quickly adds that "major efforts are being made in learner success that are focused on enhancing learner persistence and program completion.")

Capella’s roots, which are steeped in both business and academia, were established in 1993 by its current Chancellor Stephen Shank, an attorney and former CEO of a nationally prominent toy manufacturing company, and the late Harold Abel, a former president of three universities.

For about six years, the university was called "The Graduate School of America," and it offered distance education master’s and doctoral degree programs in management, education and human services. In 1997, Capella achieved accreditation by the Higher Learning Commission of the North Central Association of Colleges and Schools. Within three years, it established its five virtual schools: business, education, human services, psychology and technology.

Offerman, who became president in June 2001, says that the presidency was attractive to him because of the institution’s "balanced approach, bringing together the best of business practices with what I think are the best of academic practices. Right from the very origins of Capella there has been this intent and the reality of balancing these two worlds, and that carries through today."

Capella is privately held by Capella Education Company based in Minneapolis, with investments said to total $77 million to date, according to a January 23, 2003 article in the Business and Technology section of the Seattle Times. Capella investors include, from the beginning, Cherry Tree Investment out of Minneapolis; along with Frostmann Little & Co., Putnam Investments, ThinkEquity and RBC Capital Markets investing $16.7 million in March 2002; and Maveron, LLC, investing $7.5 million in January 2003. Maveron is co-founded by Starbucks Coffee Company Chairman Howard Schultz, who also came on board, along with other Maveron executives, as advisors to the Capella management team,

On the academic side, Capella’s top-level administrators (President, Provost and Vice President of Advising and Academic Support) combined have decades of experience from previous administrative positions they held inside traditional higher education institutions, such as the University of Wisconsin system, Ohio University, Franklin Pierce College and the University of Arizona.

Part of the bottom line is that through this blend of business and academia, Capella is "trying to provide adult learners with programs that are going to have an immediate impact in their work, that are going to provide sustained value to them as professionals, that are based on what we call an intimate learning experience," says Offerman.

"We are very leaner centered, and if I can use a word from the business side, we are very customer focused."