Money & Finance Opinion

Uberblogger Russo Asks: What is Social Entrepreneurship in Public Education? Who is a Social Entrepreneur?

February 11, 2008 5 min read
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Social entrepreneurship is everywhere these days…. And of course it’s a big buzzword in certain education circles as well. I still don’t know what it means.”

Alexander Russo keeps asking simple, important questions about the market for public school improvement. First, about philanthropy’s real interest in the efficacy of its grantees’ programs. Then, the role and value of Washington’s so-called education policy “think tanks.” Now he’d like to know what the phrase “social entrepreneur” means in public education.

These kinds of questions seem incredibly naïve - until someone tries to answer them. Of course foundations care about the value their grantees’ programs add to student performance. It’s obvious that think tanks advise policymakers. Social entrepreneurs are in the trenches – schools mostly - taking risks by running projects to change public education.

But pull off the bumper sticker, and you will find that these terms obscure more than enlighten. The image conveyed by each label is an ideal rarely realized, and enough posers have claimed each mantle to stretch their meaning beyond recognition. In a series of essays on foundation evaluation and education policy shops, I’ve tried to show how we’ve reached a point where the insignia often don’t match reality. Most foundations don’t see to it that their grantees are evaluated seriously. Most policy groups don’t have a direct or sustained effect on federal education policy.

“Social entrepreneurship” is another of these terms. I will argue that there are “real” social entrepreneurs in public education. They are quite scarce; not many are the people called such by the media. If we apply the term properly, it will be obvious that most of the real social entrepreneurs in public education are being starved by their supposed benefactors - sometimes quite deliberately.
Before investing time in another essay series, edbizbuzz readers have some right to know why I feel qualified to say anything about this topic.

I could start and end with “entrepreneurship has been central to the school improvement industry’s for- and non-profit sectors. edbizbuzz.com is about the industry.” End of argument. See my posting on Eduventures. But my interest is also based on life experience.

When I was in grade school, my dad left a very nice job in the hotel and restaurant industry to start his own restaurants - with his own meager savings (and a loan from the bank securitized by our home). He was pretty good at it. By the time I went to college, my dad had owned five successful establishments. He went on to second, third and fourth careers in hotel turn-arounds, the sale of unusual investments like debt and marginal oil wells, and finally ended up as activist for WWII military veterans in San Diego.

My dad liked money and knew how to spend it well, but the game was not about money. He was a serial (commercial) entrepreneur, in it for the adrenalin high. As soon as something he started was running well, he got out of it - probably before he would reap the full financial reward, and turned to a new venture. Sometimes our family of eight was quite flush, and other times well into the tab at a whole lot of local stores. My dad could be just as happy broke, as long as he was in the game. To this day, I know the type.

At first, I fought the type. I spent most of my working life as a policy analyst in organizations with almost no chance of going out of business. In the mid-1990’s I took a big leap because 1) I felt that no decisionmaker should take the advice of someone who never felt the burden of having to make decisions with consequences for others and 2) I wanted to apply my new law degree to an entrepreneurial setting. After New American Schools and its Design Teams agreed to adopt the fee-for-service program dissemination strategy I’d argued for at RAND, I went over to manage NAS’ interests in that portfolio of school reform organizations. From that still relatively safe perch I help others transition to fees, tried out a great many ideas, made mistakes and watched others do the same. I developed a toolkit of business, financial and legal skills, and learned a lot about business models for disseminating education program models at scale.

Later from that same perch, I took those skills and built another nonprofit from scratch, the Education Entrepreneurs Fund - essentially a $15 million bank and equity investor in high-risk k-12 starts. I convinced Prudential Insurance to lend the fund $10 million. With the responsibility of an obligation to pay back and, for a long time, a first-rate investment committee of former Fortune 10 CEOs, I learned a lot more. In the end, I left because the investment committee changed, our philosophies and styles didn’t mesh, I didn’t own what I had built, and I wasn’t about to win a fight over the direction of something that wasn’t legally mine.

I learned four things about myself: I am comfortable making consequential decisions, I prefer to make my own mistakes, I get the same adrenelin rush from risk that drove my dad, and it’s not fundamentally about the money. In 2004, I started my own tiny information services company with my own money. I’m still in business, the first rung of success.

I grew up experiencing the effects of a parent’s entrepreneurial lifestyle. I think I have enough hands-on training to fall at least within the overbroad definition of social entrepreneur myself, as well as (commercial) entrepreneur. I’ve been responsible for the investment of enough money in both types of providers in public education to have had many “high stakes” relationships with both types of entrepreneur. And with my research training, I’ve spent enough time reviewing the literature on entrepreneurs to write materials academically relevant to the topic. I think I have something worth saying about the topic.

Next: First principles. The original (commercial) entrepreneur and her social namesake share several features, but in a few crucial respects, the social version is a pale copy - and not because of the profit motive per se.

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