The document discusses issues with for-profit education companies and proposes a solution called an "E Corp" status. For-profit colleges and K-12 charter schools run by for-profits have much lower graduation rates and proficiency standards compared to non-profits. This is because financial goals are prioritized over academic goals. The author suggests education companies could become transparent about their values, outcomes, costs and profits if they attain E Corp status, similar to Benefit Corporations. Requiring E Corp status could be a condition for receiving federal education funds. This may help students make more informed choices about for-profit colleges.

1. Educa&on
For-­‐Profits
Don’t
Have
to
Suck
John
Katzman
Founder
&
CEO

2. Capitalism
has
produced
some
great
things.
So
why
not
in
educa&on?

3. For-­‐Profit
Schools
Under-­‐perform
• For-­‐profit
universi&es
have
a
6-­‐year
gradua&on
rate
of
22%
(it’s
60%
at
non-­‐
profits).
• K-­‐12
charter
schools
run
by
for-­‐profit
companies
are
20%
less
likely
than
those
run
by
non-­‐profits
to
meet
proficiency
standards.

4. Financial
Goals
above
Academic
Goals
• Educa&onal
results
take
many
years
to
measure,
but
profits
and
bonuses
are
realized
immediately.
• For-­‐profits
can
respond
nimbly
to
changing
condi&ons
and
raise
the
capital
needed
to
scale.
• There
are
even
a
few
good
ones.

5. How
can
we
balance
quality
and
financial
returns?
• Benefit
corpora&ons
(or
B
Corps)
are
businesses
that
promise
to
consider
more
than
just
shareholder
value
when
making
decisions.
• B
Corps
are
expected
to
act
in
the
public
interest.

6. The
E
Corp
• What
if
we
applied
that
idea
to
educa&on
companies?
Let’s
call
it
the
E
Corp.
• An
educa&on
company
could
aain
E
Corp
status
by
becoming
transparent
about
its
values
and
outcomes.
• Colleges
owned
by
E
Corps
should
tell
every
prospec&ve
student
the
gradua&on
rate,
average
student
debt,
and
star&ng
salaries
of
similar
students.
• Students
would
sign
a
form
describing
their
instruc&onal,
marke&ng,
and
execu&ve
compensa&on
costs-­‐-­‐and
their
profits-­‐-­‐per
student.

7. Leveraging
Federal
Dollars
• We
could
even
require
that
ins&tu&ons
elect
E
Corp
status
in
order
to
receive
federal
funds:
– Title
I
(K-­‐12)
– Title
IV
(higher
ed)

8. How
many
students
would
choose
a
for-­‐profit
college
if
they
knew
the
about
the
outcomes?