The Big, Big Problem with Current K-12 Investing

Market Trends

The Big, Big Problem with Current K-12 Investing

By Alex Hernandez, Aylon Samouha and Jeff Wetzler     Nov 16, 2015

The Big, Big Problem with Current K-12 Investing

If public K-12 invested 2% of its national spending on research and development (R&D), that would total $12 billion every year.

For perspective, Tesla, widely considered one of the world’s most innovative companies, raised approximately $200 million for the R&D required to put its first electric vehicles on the road. With that aforementioned 2%, K-12 could finance 60 new organizations like Tesla... every year.

Our public schools have big problems worth solving and big opportunities worth seizing. Yet it is difficult to point to the breakthroughs that define so many other industries—and it’s equally unclear who we’d entrust with $100 million to solve a problem that makes teachers and students better off.

Yet, we believe K-12 should invest significantly more money in R&D—making smart bets on dozens of “big problems” every year—while radically changing how those dollars are allocated.

Putting a price tag on innovation

Innovation costs money. For example, substantial investment is needed to create new school models that move us beyond the "factory model" of school design, which has been in place for over a century. Where we have seen promising progress towards innovative and replicable school models—whether in California’s Lindsay Unified School District or the Summit Public Schools charter network—we have simultaneously seen serious, multi-million dollar R&D investments. This is just the tip of the iceberg of the R&D needed on school model innovation, and we applaud those efforts, such as the Project XQ Superschool competition, that demonstrate how to make deeper investments in this area.

Another potential “big problem” requiring deep investment is around high-quality instructional materials rooted in learning science. K-12 could easily invest $100 million developing a world-class high school curriculum.** If we want a choice in course providers—three choices per course seems reasonable—or even higher-quality content, the price tag could easily reach $500 million. Five hundred million dollars is an eye-popping number, yet it is less than one-tenth of one percent of our annual K-12 spend.

But the resources clearly exist to solve big problems. In two-and-half years, the Investing in Innovation Fund (i3) program could single-handedly finance a world-class high school curriculum. One or two large foundations such as the Bill & Melinda Gates Foundation or The William and Flora Hewlett Foundation could do it. The New York City Department of Education could finance all $500 million in a single year if they allocated 2% of their annual $25 billion budget.

However, re-appropriating dollars might be easier than figuring out how to successfully spend them.

A better strategy for K-12 R&D

Here are some suggestions for a better R&D strategy in K-12.

  1. Build a broad coalition around a couple Sputnik-type challenges every few years. K-12 politics are some of the most divisive in America, but compromise for its own sake can stifle progress and lead us back to the status quo. However, it seems that there are some major challenges and opportunities we can invest in that can garner support across the political spectrum. Other battles will continue to rage, but that shouldn’t preclude large investments in addressing common problems and new approaches where there is some general agreement. Doctors let others create MRI machines and develop new treatment methods. R&D investments in education that benefit teachers can lift an entire profession.
  2. Invest at the intersection of great classrooms and strong R&D teams. Teach Like a Champion (TLaC), one of the more successful teacher development efforts to emerge in the last decade, began with a simple question: what do the best teachers do to get great results with high-need students? The TLaC team partnered with talented teachers in high-performing classrooms to identify a taxonomy of great teaching practices and share them in a way that is useful to teachers. It is hard to imagine a great school innovation springing forth where the R&D effort is detached from highly-effective classrooms.
  3. Concentrate large investment dollars in a few select organizations with strong R&D capacity and/or R&D partnerships. While it’s “nice” to believe that all organizations are equally capable of innovation, no one expects Blackberry to be as innovative as Apple. If K-12 follows a similar pattern, a small number of organizations will disproportionately produce the most significant R&D. Some established organizations will turn the flywheel of high performance and deep expertise to keep breaking new ground (e.g., KIPP Through College), while upstarts use fearlessness and moxy to create whole new approaches (e.g., Summit’s Personalized Learning Plan). It is important to invest in both types of organizations and stay open to new types of R&D vehicles. For example, what would result if we granted $25 million of R&D funds to the mathtwitterblogosphere community of expert math teachers? Could they outdo a large education publisher or school of education on the innovation front?

Twelve billion dollars of R&D funds each year could transform K-12 if we spend big and spend well. Yet, large-scale K-12 investments in the tens or hundreds of millions of dollars are rarely seen.

Funding K-12’s future

There are many paths up the hill of creating a significant R&D engine in K-12 education. Here’s an idea: one example could be a nonprofit, K-12 R&D fund—or series of funds—supported by a combination of federal grants and philanthropy.

An independent, nonprofit fund has several distinct advantages. First, it can develop expertise investing in cutting-edge R&D, something that is difficult for both the federal government and states. Second, R&D is risky. “Dry holes” will be drilled, to borrow a phrase from from the oil and gas sector, and an independent fund can be structured to take and withstand more risk. Finally, the fund can provide some additional insulation from the politicization of certain education issues in the short-term.

The public-private partnership allows philanthropists to pool their resources in large enough amounts to have significant impact while augmenting their investment with public funds. And, perhaps more importantly, such a greenfield organization could broker each generation of Sputnik-type challenges that form the foundation of massive public-private investment.

We can change the dynamics that currently prevent R&D dollars getting to the right problems with the right organizations in the right amounts. For a sector with annual expenditures of $600 billion, we should be good for at least a few Teslas each year.

Acknowledgements: a special thank you to Bror Saxberg and Andy Rotherham for their invaluable insights on this topic.

Alex Hernandez is a partner at Charter School Growth Fund, a nonprofit that supports the growth of the nation's best public charter schools. Charter School Growth Fund is a philanthropic investor in Summit Public Schools. Alex is also an official EdSurge columnist. Aylon Samouha and Jeff Wetzler are co-founders of Transcend, a nonprofit organization that fuels innovation in school design in close partnership with visionary school operators around the country.

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