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"Technology has transformed communications, increased the efficiency of retailing and helped elect a president. But because education is largely protected from incentives and consequences, it lags in embracing technology.

That must and will change. At a New York City pilot program, School of One, for example, each student has a daily ''playlist'' tailored to their instructional level, interests and learning style. The school blends online learning, small group sessions and tutoring. It's a vivid picture of the shift from age cohorts slogging through a textbook to personalized digital learning.

This fall, about two million K-12 students will be learning online at home and at school (about 4 percent of the national student body). By 2020, I believe most high-school students will do most of their learning online. It shouldn't take that long, but it will.

New tools already make possible a generation of schools that blend the best of online and on-site learning. They will be less expensive and more fun, delivering excellence with equity."
-Tom Vander Ark
Sept. 27, 2009

Foundation Impact
Innovative education investment strategies

6 reasons foundations should incorporate venture strategies

Foundations should invest at least a portion of their endowments in return seeking vehicles related to their programmatic goals (Mission Related Investments, MRI). They should also leverage their balance sheets to provide venture debt and credit enhancements (often structured as Program Related Investments, PRI) to help scale promising organizations-both nonprofit and for-profit. Here's a half a dozen reason why foundations should more aggressively use venture investment strategies:

1.     The US won't achieve goals without innovation. Current reform agendas will bring up the rear but are unlikely to dramatically boost learning productivity--that will require innovation.

2.     Innovation is best produced and scaled by the private sector that has inherent incentives for speed, quality and scale. We won't be able to spend our way to national educational improvement; public-private innovation partnerships will be key to improvement as they are in health, energy, defense, and transportation.

3.     There is a new opportunity set for innovation; cheap access devices, ubiquitous broadband, and powerful application development platforms are making possible a new generation of learning tools. Innovation platforms have transformed every other sector and will improve education productivity if we create openings for investment and innovation.

4.     There is a unique opportunity to leverage the $10 billion of ARRA investment particularly in regards to school improvement. Nonprofits simply can't invest and scale sufficiently to support work in 10,000 struggling schools.

5.     Nonprofits need scaling capital. In addition to unrestricted grants, high performing charter school operators and other nonprofits need access to low cost growth capital including low cost loans or credit enhancements.

6.     Best of all, foundations can improve impact with little additional risk by selectively making venture debt and equity investments related to program goals.

We are writing a paper on venture investing by foundations. If you have a good example of an MRI or PRI, we'd like to talk with you.

Advocacy

Parent Revolution continues to make things interesting for LAUSD which has agreed to bid out PI3-5 schools at the request of more than 50% of the parents.

ConnCAN is cooking a plan for 50CAN, the first AMO (advocacy management organization)--an effort to incubate effective state advocacy organizations focused on strong accountability, school choice, and teacher/leader effectiveness. Education Equality Project continues to provide air cover for folks fighting these battles and will be key to strong reauthorization language.

Charter Schools

Charter Schools would gain equitable funding after winning a few key lawsuits. There's a plan for a national charter defense fund worth looking at (contact Andrew Broy, GA DOE for details).

Charter school associations could use help positioning charters well in state RttT proposals and increasing the number of charter restarts. Follow Schwab's lead and make a grant to the Alliance.

Tony Roberts, GA Charter School Association, has an interesting i3 proposal and Communities In Schools of GA is expanding PLCs.

Eileen Sigmund, AZ Charter School Association, is using data to drive quality.

EduInnovation

We're developing a website that will highlight innovations in learning. Like TechCrunch.com does for IT and Grist.org does for clean tech, EduInnovation will be the place to go to learn what's new, who's doing it, and who's funding it. Help us shape it!

Sincerely,

Tom, Karen, Bennet, Melissa

This newsletter features information on the work of organizations we admire and work with. Some of the above-mentioned organizations are clients of VA/R.