Edison Project Spares No Cost In Wooing Prospective Clients

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Outside, three championship golf courses beckoned at the foot of the Rocky Mountains. A world-class spa featuring massage rooms, mineral baths, and fireplace-warmed lounges also awaited the guests at the luxurious Broadmoor resort here.

But on a recent morning, 350 school board members, administrators, and other interested parties were cooped up in the resort's conference center to discuss the Edison Project.

"Consistent with the Edison design, we have an extended day and a rich curriculum planned for all of you," said Christopher Whittle, the founder and president of the New York City-based company that now manages 51 public schools for districts and charter groups across the country.

Christopher Whittle

At the Edison Project's National Client Conference, anyone who hoped to squeeze in a round of golf or take a mudbath at the spa had to cut class, so to speak. For 2 jampacked days, Edison staff members and current clients focused on persuading prospective clients to sign up for one of the country's most carefully watched school management and reform experiments.

Although Edison also invited a group of financial analysts, journalists, and teachers' union representatives, the conference was essentially a deluxe sales presentation for the company's target customers: more than 200 people representing 52 school districts and 38 charter groups.

"This is an opportunity for those considering [a contract] to meet all sorts of Edison representatives in one place," Mr. Whittle told the attendees.

Courting Texas

Now in its fourth year of running schools, Edison launched with four schools amid grave doubts in financial circles. But the company has steadily added new contracts, going from 12 schools in its second year, to 25 last year, to the current 51.

Its hallmarks include a longer day and year than the typical public school, a heavy focus on technology (with computers provided in every student's home), and a challenging curriculum developed during the project's $40 million design phase.

Among those seeking to learn more about the Edison Project was a large delegation, including seven members of the school board, from the Mission Consolidated Independent School District near Brownsville, Texas.

"Most of us are in favor of doing this as an opportunity for the children," said Norie Garza, a board member of the 12,000-student district.

Lupe Gonzalez, the district's superintendent, could not make it to the Broadmoor for the Sept. 30-Oct. 2 conference because of a prior commitment. But he said in an interview that the district and Edison have been in discussions for several months.

Mission Consolidated is considering turning over up to three of its elementary schools to Edison, he said. Four district principals have been to the company's headquarters in New York City to learn more about it and be evaluated by Edison for their compatibility with its philosophy and approach, Mr. Gonzalez added.

"The last thing was the board of trustees attending the client conference," he said. "That went over very well. We are now trying to gear up and put it on the board agenda."

Ms. Garza and the other members of the Mission delegation, along with the other conference attendees, were invited to stay at the Broadmoor at the expense of the Edison Project. The only thing not included was transportation to and from Colorado Springs, and any incidentals, such as snacks from the hotel room minibars.

For those guests whose company or district policy does not permit them to accept free lodging, the room charge at the Broadmoor for the event was $245 per night, plus a $10 daily service charge, plus taxes.

Gene Buinger, the superintendent of the 25,000-student Bibb County, Ga., schools, said district policy did not allow him to accept the free lodging from the Edison Project.

His district is also considering turning over one or more elementary schools to Edison, and Mr. Buinger came here to talk to principals and superintendents in districts that already have a relationship with the company.

"So far, everyone I've talked to has been very satisfied," he said. He compared the Edison conference to similar conferences for educators sponsored by computer companies, which were also intended primarily to build customer relationships.

"The location and all the glitz doesn't really have an impact on me," he said.

Unions Welcomed

Heidi Steffens, a senior policy analyst for the National Education Association who attended the conference, said she would have liked a franker discussion of the problems the Edison Project has run into at some sites.

"This was a real sales conference," she said. "The purpose wasn't anything but to attract new clients. I would have found it more convincing if there was more discussion of the warts."

Those warts, in the view of some observers, include problems with providing special education services at some Edison sites, difficulty in adapting to Edison's complex design at others, and differing interpretations of the project's early test results.

But both Ms. Steffens and Nancy Van Meter, an associate director of the department of organization and field services for the American Federation of Teachers, found it encouraging that Edison invited the teachers' unions. The unions often have expressed opposition to for-profit management of public schools, but many of their affiliates are involved in school contracts with the company.

"It is important for them to build a relationship with our organizations," said Ms. Van Meter, who also attended. "If they are going to succeed, it is going to be because they are working with the teachers."

Mr. Whittle announced at the conference that Edison has just approved a stock-option program for teachers and principals. The details are murky, but the company's founder said teachers could benefit financially once Edison starts turning a profit.

"Educators in this country have essentially had to take a vow of poverty," Mr. Whittle said one evening after conference attendees dined on steak and shrimp.

New Ventures Eyed

Although making predictions had gotten him in trouble in the past, Mr. Whittle said, he made a number of them about the near- and long-term future of the Edison Project. (The company is still living down Mr. Whittle's 1991 prediction of opening 200 private schools by 1996.)

Within a year, he said, an Edison Foundation could be formed to help funnel philanthropy into the process of signing up schools. This has happened informally so far, including a $25 million donation from the Fisher Family Foundation that allowed a number of California districts to sign up with Edison.

Also within a year or so, Edison will be looking to launch preschools.

"We need to be in that, and be in that fast," Mr. Whittle said.

Within three years, he added, Edison could be designing its own school buildings, especially for charter school arrangements. The company has essentially had to take what it was given by districts and charter groups.

Also within three years, Mr. Whittle said, the company is likely to open its first schools outside the United States. It has already had discussions with interested groups in Britain, Japan, Saudi Arabia, and other countries, he said.

Within five years, Edison could have its own teachers' college, Mr. Whittle said.

"This is not just a notion anymore. This is a company with 125 employees, backed by $160 million in equity," Mr. Whittle said during one session. The employment figure does not include school employees such as teachers and principals, who typically remain employees of the district or charter group.

In a session called "Making Sense of the Dollars," Edison's financial officials said the company expects revenues of $135 million this year but is still operating in the red.

"Hopefully, we will be at break-even next year at 75 schools, with a small profit after that," said Richard O'Neill, a vice president of contract development for Edison. "We will only get to scale when we have 350 schools."

By the end of the conference, Edison officials appeared pleased.

"This is a lengthy and pretty sophisticated dialogue, and this is only one part of the process," said Christopher Cerf, an executive vice president of the company. "But our sense was there was a high level of interest."

Vol. 18, Issue 7, Pages 1, 16

Published in Print: October 14, 1998, as Edison Project Spares No Cost In Wooing Prospective Clients
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