Mogul Paul Allen bankrolls the Edison Project.
The Edison Project, the controversial for-profit education venture begun by Chris Whittle, will enter its fourth year of managing public schools this fall with its largest lineup of schools and a new round of private investment led by software billionaire Paul Allen, a co-founder of Microsoft.
Allen's Vulcan Ventures Inc. of Bellevue, Washington, is investing $30 million in the New York City-based Edison, which contracts to manage charter and public schools nationwide. Additional new investors have combined with Allen to contribute a total of $71 million in Edison's latest round of private financing. The money will help Edison expand from 51 schools in the 1998-99 school year to 77 schools this fall. Enrollment in the schools is expected to grow from 24,000 last year to 37,000.
"This is our largest capital infusion since our inception," says Whittle, Edison's founder, president, and chief executive officer. "It is increasingly easy to raise [capital]. In the early days, it was not."
Edison has received $232 million in private investment since its founding in 1992. Although the company is not yet profitable, officials say its growth is meeting expectations. Edison also filed papers this summer for its first offering of stocks to the public. No date has been set for the sale.
Allen helped found Microsoft with his friend Bill Gates in 1975 then left the company for health reasons in 1983. He retains some 8 percent of stock in the software giant, using his wealth to back technology-related start-ups.
Whittle has also announced a deal between Edison and APEX Online Learning Inc., a technology company financed by Allen. APEX, also based in Bellevue, provides online versions of Advanced Placement courses to high school students who don't have such courses available in their schools. Edison plans to invest at least $5 million in APEX, and this coming school year will test ways of integrating classroom instruction with online learning at four to six of its schools, according to Whittle. Sally Narodeck, chief executive officer of APEX, says, "For us, this is an opportunity to get close to a customer that is very focused on improving student achievement."
Vol. 11, Issue 01, Page 28Published in Print: August 11, 1999, as Ante Up