NewSchools Venture Fund Reaches $100 Million Landmark

Published June 1, 2007

One year short of its 10th anniversary, NewSchools Venture Fund–a California-based organization that raises venture capital for education entrepreneurs–has raised $100 million in total over the past decade. It’s an amount Chief Executive Officer Ted Mitchell said will continue going to organizations that support its mission to improve public education.

“It’s important to note that this capital has been channeled toward a variety of entrepreneurial organizations, including for-profits and nonprofits,” Mitchell said. “Some of these organizations have developed new approaches to preparing teachers or leaders, such as Teach for America and New Leaders for New Schools. Others have developed charter management organizations [CMOs] in urban areas across the country.”

Expanding Charters

The entrepreneurs NewSchools supports are either working to expand charter schools or pushing for the betterment of current schools through performance-driven strategies. NewSchools has helped create more than 100 new public charter schools serving more than 30,000 students nationwide, Mitchell said.

According to Mitchell, creating multiple schools in a concentrated region helps them exhibit high student achievement and may lead to overall district improvement.

“Early results [for the schools] are promising,” Mitchell said. “Low-income students in our charter management organizations’ elementary and middle schools are on average achieving 44 percent higher proficiency rates in reading and 23 percent higher proficiency rates in math than those in their host districts. Low-income students in our CMOs’ high schools are, on average, achieving 52 percent higher proficiency rates in reading and 36 percent higher proficiency rates in math than those in their host districts.”

Answering Critics

Critics such as Alex Molnar, director of the Education Policy Unit at Arizona State University, say the organization is not bringing any new school reform models to the table. In a January 17 Education Week article, Molnar wrote, “There’s absolutely nothing new here,” in reference to NewSchools.

“It’s the same tired rhetoric about competition, the same identification of high-performing schools that are going to serve as models, the same idea that somehow, magically, the presence of these schools is going to make schools that are underperforming into performers,” Molnar continued.

Brian Carpenter, chief executive officer of the Michigan-based National Charter School Institute, disagrees. He said the $100 million that NewSchools has apportioned to building schools and education reform has done much for the education system in an environment that is unfriendly to innovative newcomers.

“[The $100 million] is less than a tenth of a penny of all the money that is spent in K-12 education in this country,” Carpenter pointed out. “When you are trying to assess the impact of $100 million against a total spending pot of a half-trillion dollars, it’s extremely difficult to do. I would argue that [NewSchools’] impact is disproportionate to [its] contribution. [It’s] supporting tremendously important organizations that have a disproportionate impact for good.”

The National Charter School Institute acts as a resource organization for charter schools.

Finding Acceptance

NewSchools has one thing in common with the charter schools it supports: Both are outsiders struggling for mainstream acceptance.

“The reason why it is hard for organizations like NewSchools,” Carpenter added, is that the education establishment has “helped themselves to the whole half-trillion dollar pie, and there is no room at the table for entrepreneurs and new schools to get a bite of it.”

Expanding Nationwide

Most of NewSchools’ work has been concentrated in California. Mitchell said the next step for the organization will be geographic expansion.

“Today, the urban areas that we are focused on are Oakland/Bay Area, Los Angeles, New York City, Chicago, and Washington, DC,” Mitchell explained. “These areas have been chosen because of their national prominence, magnitude of student need, and potential for transformative change.

“Within each of these areas, we hope to support charter management organizations, but also other organizations that address the most fundamental needs of public education today, including the need to address recruitment and preparation of high-quality teachers and ways to facilitate the use and usefulness of student assessment data,” Mitchell said.

NewSchools plans to raise $60 million for its expansion into new communities.

Aricka Flowers ([email protected]) writes from Chicago.

For more information …

“Venture Fund Fueling Push for New Schools,” by Erik W. Robelen, Education Week, January 17, 2007,