Ed. Business Opportunities Center on Common Core, Global Growth
Hundreds of education companies converged here this week in search of new opportunities in the K-12 marketplace at EdNET 2013. Speakers identified several prime openings for business, including those connected to the nearly nationwide implementation of the Common Core State Standards, new assessments matched to the standards, professional development focused on adopting new educational technologies, and making inroads to help other countries find educational uses for the digital devices they are providing to millions of their students.
All of those roads have potential potholes and detours. But attendees at the conference were told that they could find their way by identifying solutions that are of practical use to educators.
"Some of the companies doing the best right now (have) positioned their products best to the common core," said Chad Johnson, managing director of Cherry Tree Companies, a Minnetonka, Minn.-based investment banking firm, who provided an updated on equity capital markets.
As the next generation of standards, the common core means "a new set of instruction, new set of training, and a new set of assessments" that will be good for the industry, said Peter Cohen, president of McGraw-Hill Education's School Education Group. "They have a great potential to make us more competitive on a global scale." However, districts' focus on acquiring new common core-based products has stalled purchases in disciplines other than "literacy and numeracy" for English/language arts and math products, he said.
Aligning products to the standards doesn't translate into a "one-size-fits-all" approach for states. In Florida, California, and many other states, the "common" only applies to 80 percent of the content, noted Mary Cullinane, chief content officer and executive vice president of corporate affairs at Houghton Mifflin Harcourt.
"We are not able to just produce one program or resource, and that's all there is," she said, suggesting that a new title be coined: "Kind of the common core."
Another challenge for education publishers is the lack of agreement about what constitutes alignment. "There's great elasticity to that," Cullinane said. In fact, within the same district, an approval of a piece of content by one decision maker could easily get a "thumbs down" by another.
Unlike some business executies from industries outside of the education sphere, education publishers did not express concern that the standards would be rejected by states.
Several presenters made the global market sound easier to access than the K-12 districts in their own backyards, because of tight school budgets, procurement procedures, and long purchasing timelines in the U.S. school systems.
Nelson B. Heller of the HellerResults Group in Solana Beach, Calif., compared Maine's purchase of 400,000 laptops and Los Angeles Unified School District's 650,000 iPads to even larger deals approved abroad, commitments for government purchases of 4.5 million laptops for 5th and 6th graders in Mexico, and five million tablets in Thailand by 2015. He said the international educational marketplace offers an abundance of opportunities beginning with professional development for teachers.
"These people have to bootstrap an entire nation of teachers" to use this technology, he said.
An example of a company that has found opportunities in global education is Eleutian, a Cody, Wyo.-based business that teaches English to clients in other countries using video conferencing—including lessons for South Korean teachers in how to teach English as a second language to their students.
Heller recommended that businesses identify companies like Eleutian that they can partner with to get a foothold in international markets.
Beyond that, he pinpointed opportunities in tutoring, afterschool and test preparation, eBooks, localized cloud platforms, and digital literacy.
In the United States, cash-strapped states may be open to opportunities, too, said Brian Sigritz, director of state fiscal studies, National Association of State Budget Officers.
State budgets for fiscal 2014 "show widespread improvements, but resources remain tight. General fund spending and revenue remain below pre-recession peaks when adjusted for inflation," he told the audience.
Because states will continue to face difficult spending decisions for some time to come, Sigritz said policymakers might be more open to considering change, and new policies related to restructuring and streamlining programs and services. "The movement toward greater accountability is going to continue," he added, so tying funding to performance and measurable results will be key.
To learn more about what happened at EdNET, read an overview of the first day's sessions here.