How ed ventures succeed

Many for-profit education entrepreneurs have crashed and burned, writes Julie Landry Petersen in Education Next. She looks at three innovators who’ve had an impact and stayed in business: Larry Berger (Wireless Generation), Jonathan Harber (SchoolNet) and Ron Packard (K12).

“The economics of education investing are changing,” writes Petersen. Ed tech companies raised $1.1 billion in venture funding in 2012, more than double the amount raised the prior year.

 

A teacher in virtual charter hell

After 15 Months in Virtual Charter Hell, Darcy Bedortha quit her job as a high school English teacher for K12 Inc., the nation’s largest virtual education company. She couldn’t meet students’ learning needs, she writes in Education Week Teacher.

K12 pays full-time teachers $42,000 a year to teach a minimum of 226 students, writes Bedortha. Some full-timers have more than 300 students.

Students can enroll at any time.

In a given day in mid-November I would grade introductory assignments, diagnostic essays and end-of-semester projects, and everything in between, for each course (this month I had 30 separate courses). I found it to be impossible to meet the learning needs of my students in that situation.

Many students are phantoms, Bedortha writes. Fewer than 10 percent of students “attended” the weekly 30-minute “class,” which used an interactive blackboard. Only a small percentage communicated by email.

Most were behind in high school credits and “could not afford another failure.”

. . .  as I wrote this in early December, nearly 80 percent of our students were failing their classes.  At that time there were 303 students (12 percent of the school) enrolled in special education programs – and 259 of them were failing while 17 had no grade at all. Eighty-two percent of the 9th graders were failing. 

Other virtual schools face similar failure rates, writes Bedortha. Only 37.6 percent of students at full-time virtual schools graduate on time, compared to 79.4 percent of all public high school students according to a July 2012 National Education Policy Center report.

Virtual schools do best for mature, self-directed learners or for students with a homeschooling parent. Most students who’ve failed in schools with in-person teachers won’t succeed with less personal contact with a teacher. But they need an alternative to traditional schooling.

Virtual schools are bound to attract transient students. We need a way to fund virtual charters so they’re not compensated for students who aren’t using the school’s services.

How good (or bad) are virtual schools?

K12 Inc.‘s virtual schools aren’t performing well, concludes a National Education Policy Center (NEPC) analysis by Gary Miron and Jessica Urschel. Only 28 percent of the for-profit company’s schools made Adequate Yearly Progress (AYP) in 2010-11, compared to 52 percent of schools nationwide. K12 students were less likely to score at the “proficient” level on state tests. The on-time graduation rate for K12 high school students was 49 percent, compared to 79 percent at schools in the same states.

NEPC uses  “badly flawed measures of school performance,” counters Matthew Chingos of Brookings on Education Next.

. . . the measures of “performance” it employs are based primarily on outcomes such as test scores that may reveal more about student background than about the quality of the school, and on inappropriate comparisons between virtual schools and all schools in the same state. What parents and policymakers need to know about a school is how much its students learn relative to what they would have learned at the school they would otherwise have attended.

Comparing virtual schools to all schools in the state ignores the possibility that ” families are most likely to choose the virtual option when their traditional options are unsatisfactory,” Chingos writes.

I’d guess that virtual schools attract a disproportionate number of students who are bored, restless and unsuccessful at traditional schools. These students are likely to be unsuccessful at virtual schools too since online learning requires self discipline (or close parental supervision).

States should “slow or put a moratorium on the growth of full-time virtual schools,” the NEPC report urges.

Policymakers and parents need reliable data to evaluate virtual schools’ quality, Chingos counters.  “It is simply not possible to make these sorts of decisions with the data in the NEPC report.”

New York Times vs. virtual schools

Online Schools Score Better on Wall Street Than in Classrooms, writes the New York Times, singling out K12, a for-profit that started by providing curriculum to homeschoolers and now runs charter schools (and works with school districts).

Despite lower operating costs, the online companies collect nearly as much taxpayer money in some states as brick-and-mortar charter schools. In Pennsylvania, about 30,000 students are enrolled in online schools at an average cost of about $10,000 per student. The state auditor general, Jack Wagner, said that is double or more what it costs the companies to educate those children online.

K12 recruiters “fail to filter out students who are not suited for the program, which requires strong parental commitment and self-motivated students, company staffers tell the Times.

If a charter screened out high-risk students, surely the Times would be indignant.

Only a third of K12′s schools achieve “adequate yearly progress,” according to a forthcoming study by researchers at Western Michigan University and the National Education Policy Center, the story adds.

Well, they do take high-risk students.

The story is part of “a series of hit pieces” targeting innovative private companies, charges Tom Vander Ark. Meanwhile, as the Times “maliciously savages sector leaders like K12 and Carnegie Learning, they are out marketing their own ‘state of the art learning management system’ called Epsilen,” he writes.

Vander Ark goes on to detail what’s wrong with the story.

Reporting on for-profit education often generates “more hysteria than analysis,”writes Rick Hess, who calls the Times story a “selectively sourced attack.”

Sure, there are valid and sensible concerns about the role of for-profits in schooling. But aggressively recruiting clients and cutting corners to make a buck is the flip side of the things that for-profits are uniquely positioned to do well–which is to squeeze cost structures, find new efficiencies, and rapidly scale.

We need performance pay for online learning companies, writes Mike Petrillii, who sees a biased story that “landed a punch” on the issue of perverse incentives.

Clearly K12, and its well-paid CEO, Ron Packard, face strong incentives to boost enrollment at their schools. Unfortunately, states haven’t figured out a way to create similar incentives around quality. And that needs to change.

Fordham’s Creating Sound Policy for Digital Learning includes Rick Hess on quality control, Paul Hill on funding and Bryan and Emily Hassel on teachers.  An upcoming analysis will examine “what high-quality fulltime online learning really costs.”

Virtual schooling is new and there are plenty of bugs to be worked out, including how much funding is fair, how to measure quality, how many students an online teacher-coach can handle and so forth.