Per today’s important and news-containing stage-setter for the New Schools meeting in The Times, each time I hear breathless advocates excited about the increase in venture capital activity in education and how transformation is at hand or an equally breathless critic upset that it’s heralds an era of “privatization,” I think of this.
Despite a big increase percentage-wise in investment activity over the last decade, it accounts for less than one percent of our annual spend on public schools, which is north of $600 billion annually. Philanthropy, also a very marginal expenditure in the overall public finance financial picture, is nonetheless a larger player.
In other words, the rhetoric from all sides in this little war misses and is wildly disproportionate to the bigger picture and day-to-day reality of our public schools.
What does get too often overlooked, however, is that private dollars have allowed some firms to develop promising ideas that would not have been otherwise possible given the current R & D structure in education and that would not have been able to raise that capital as a non-profit. Like all sectors, the real questions are around what a healthy ecosystem should look like, what regulations and signals on quality are needed, and what appropriate accountability looks like.