Disclosure: Tom Vander Ark is CEO of Getting Smart and a partner at Learn Capital, a venture capital firm that invests in educational technology.
Since
105 years ago, it has been common to view enterprise as extraction and nonprofits and foundations as contribution--enterprise being clearly self-serving and and third sector being society-serving.
These old tax status distinctions are far less relevant today particularly in education. There are giant nonprofits in testing and research that, likedefense contractors, rely on big government contracts but pay no income tax. On the other hand, there are return-seeking companies (like
, discussed below) and investors like
, (see
) that make public benefit their focus.
Social enterprise.
Founded by Bill Drayton in 1980,
is often cited as one of the founders of the social enterprise movement--the use of commercial strategies to benefit human and environmental well-being. Ashoka provides startup financing, support services, and connections to people that want to change the world.
Leading universities, including
and
, have made social enterprise a focus for two decades. Foundations including Gates, Kellogg, Lumina,Nellie Mae and Prudential have invested in impact-oriented venture funds and impact-seeking companies including
and
.
Frustrated by the limitations of traditional philanthropy, Priscilla Chang and Mark Zuckerberg announced their intent to set aside $45 billion in an LLC to fund mission-oriented and charitable entities and enterprises.
Another example of a unique impact seeking structure is Boston area
, a 47 year-old adaptive curriculum provider. Founder
moved most of the ownership into a
but created equity like incentives for CEO Rob Waldron who assembled a talented team. Waldron calls it a "some profit" model, "We need some profits to grow and maintain a high standard of excellence, but only so much as they allow us to reinvest in our future and pay our outstanding staff."
Case Study: Curriculum Associates
In the 1980s, Curriculum Associates was a workbook publisher but they needed assessments.
inventories, launched as a student assessment tool, blossomed into a comprehensive suite for early childhood, head start and special education programs.
Six years ago, Ferguson met Waldron, a former
executive that scaled Score tutoring centers. They found shared interest in scaled impact and constructed the unique hybrid structure of a for-profit company with nonprofit beneficiaries. To avoid the typical next-quarter leadership, Waldron signed a contract with 20 year incentives.
The result of this hybrid structure with a long term view is the most explosive impact story you've probably never heard of.
i-Ready.
A small product team built an adaptive, K-8 math and reading diagnostic and instructional tool called
. Students using i-Ready Instruction for 45 minutes or more per week grew 44% more than the average student in reading and 65% more in math.
Launched in 2012, almost three million students (about 8% of U.S. enrollments) benefited from the assessment in 2015--something no high profile EdTech startups have matched.
Ready.
Built for the Common Core,
is a print workbook series for K-8 reading, writing and math. In study of more than a million students, proficiency rates for schools using Ready were 19% higher in reading and 24% higher in math.
, added in April 2015, was designed to meet expectations around modes, writing to sources and incorporating text evidence. Ready Writing features gradual release which helps build autonomy and student confidence in their writing skills while also providing teachers the step-by-step instructional support they need understand the new standards themselves and easily implement the program.
The i-Ready diagnostic points to Ready resources for on grade level print-based instruction. Ready is also available digitally, through the Ready Teacher Toolbox, providing easy access to additional classroom materials.
And to help ensure successful implementation, Curriculum Associates recently launched
--a free online portal, full of resources, tips, training videos and tools for teachers, principals and administrators using i-Ready.
The combination of reading and i-Ready provides a great blended learning toolkit for ELA and math.
Notable.
There are four remarkable things about this story:
- A workbook publisher assembled a tech team and coded an adaptive platform for both reading and math in 2011. Competitors typically focus on one subject and take years to make the same progress.
- A publisher so familiar with selling discrete products so adeptly they launched a software-as-a- service model (cloud-hosted subscription-based continuously updated software).
- All of these new products were rolled out with remarkably high service levels. For example, in serving Florida where there are a large number of i-Ready implementations, Curriculum Associates employs five sales reps and 34 service-related staff--a 7:1 service to sales ratio.
- The Curriculum Associates strategy is decidedly east coast--well funded premium products for identified customers rather than viral products seeking to capitalize on network benefits.
Curriculum Associates employs more than 500 full-time staff, 40% of whom were hired in the last year. They hire fewer than 2% of total applicants, and Waldron interviews them all. He said,
"I believe my greatest responsibility is ensuring we hire world-class talent. I make it a priority to interview every final candidate, even the summer interns, meaning I interview 300-400 people per year."
A
on the company gives learners an opportunity to explore "how a small or medium-sized privately-owned company can leverage its strengths and innovate while grappling with the challenges of providing software-as-a-service in the education sector, a leap for a company used to selling directly to schools and school districts."
The Curriculum Associates goal, according to Waldron, "is to make educators more productive... by making simple-to-use products that save teachers and administrators time, all while increasing student achievement."
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