In the past three decades, dozens of investors have tried to improve education by funneling billions of dollars into alternative schools, online education, and textbook publishing, and they have, with surprising regularity, failed. A just-released book from Columbia Business School Professor Jonathan Knee dissects what drives investors' efforts to improve education and why they consistently struggle to succeed.
In his new book, Class Clowns, Knee, a professor of Professional Practice and co-director of the Media and Technology Program at Columbia Business School, provides a fascinating postmortem on four failed efforts to transform education in America. Knee goes on to offer broad lessons from these cautionary case studies that future investors in education should heed.
“Investors in education are getting it wrong by letting their belief and desire to improve education cloud their business acumen,” Knee says, “and while not all financial investments in education end badly, the number that have failed is notable, as is the sheer magnitudes of these fiascos.”
The book takes readers inside four major and failed attempts at education reform:
- Rupert Murdoch’s unsuccessful, billion-dollar effort to reshape elementary education through technology;
- The unhappy investors — including hedge-fund titan John Paulson — who lost billions on textbook-publisher Houghton Mifflin;
- Michael Milken's 20-year mission to revolutionize the global education industry and then ultimate abandonment of Knowledge Universe;
- The case of Chris Whittle, founder of EdisonLearning and a pioneer of large-scale transformational educational ventures, who continues to attract investment despite decades of financial and operational disappointment.
In Class Clowns, Knee finds that the greatest progress in education has come from a series of targeted, incremental steps within tightly defined markets. “We’ve seen that modest, incremental successes can serve as both a platform and a stimulus for broader transformations to come,” he says.
The book offers an important guide for policy makers and guardrails for future investors, while also serving as an intelligent exposé for activists and teachers frustrated with the repeated underperformance of these attempts to shake up education.
"Without a sustainable business model, even the most inspired investors and entrepreneurs will ultimately only build a legacy of disillusionment,” says Knee. “As frustrating as it may be to an education visionary, both investors and the public will be better off if innovative ideas are applied to a narrow product or geographic space in which scale, customer captivity, and learning can be practically achieved."
To learn more about the cutting-edge research being conducted at Columbia Business School, please visit www.gsb.columbia.edu.
About Columbia Business School
Columbia Business School is the only world–class, Ivy League business school that delivers a learning experience where academic excellence meets with real–time exposure to the pulse of global business. Led by Dean Glenn Hubbard, the School’s transformative curriculum bridges academic theory with unparalleled exposure to real–world business practice, equipping students with an entrepreneurial mindset that allows them to recognize, capture, and create opportunity in any business environment. The thought leadership of the School’s faculty and staff, combined with the accomplishments of its distinguished alumni and position in the center of global business, means that the School’s efforts have an immediate, measurable impact on the forces shaping business every day. To learn more about Columbia Business School’s position at the very center of business, please visit www.gsb.columbia.edu.
About the researcher
Professor Knee teaches Media Mergers and Acquisitions, co-teaches The Media Industries: Public Policy and Business Strategy with Professor Tim Wu of Columbia Law School...Read more.