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Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
WebinarFebruary 28, 2016
Growth Strategies for Charter
Schools:Start-up, Expansion and
Maturity
2Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
WELCOME
Stuart Ellis, President and CEOCharter School Capital
Ron Packard, President and CEOPansophic Learning
3Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
WHAT WE’LL COVER
• Charter school growth stages
• Challenges school operators face at each stage
• Best practices and takeaways
Agenda
Presentation is available to download atCharterSchoolCapital.org/Webinars
Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
Stages of Growth
5Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
# of Students
Start-upSurvival/Establish
GrowthFlexibility/Stability
Sustainable MaturityEfficiency
Time (years)
0 2-3 5-10
100%
Students as a % of mature targets
10-25% 25-90% 90-100%
6Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
CHALLENGES
Reasons for charter school closures
42%
24%
19%
6%5%
4%
FinancialMismanagementAcademicAuthorizer ObstaclesFacilitiesOther
Source: The State of Charter Schools,The Center For Education Reform, December 2011
7Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
Strategic approach
Start-up Growth Sustainability
Financing
Facilities
Community involvementAcademic accountabilityOperational support
8Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
Strategic approach
Start-up Growth Sustainability
Financing Any liquidity
Facilities In target locale
Community involvement
Awareness
Academic accountability
Establish program
Operational support
Outside experts
9Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
Strategic approach
Start-up Growth Sustainability
Financing Any liquidity Flexibility/scalability
Facilities In target locale Modular
Community involvement
Awareness Fulfill the promise
Academic accountability
Establish program Measure program
Operational support
Outside experts Transitional resources
10Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
Strategic approach
Start-up Growth Sustainability
Financing Any liquidity Flexibility/scalability
Cost
Facilities In target locale Modular Curb appeal/cost
Community involvement
Awareness Fulfill the promise Fabric of community
Academic accountability
Establish program Measure program Continuous improvement
Operational support
Outside experts Transitional resources
In-house team
11Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
Strategic approach
Start-up Growth Sustainability
Financing Any liquidity Flexibility/scalability
Cost
Facilities In target locale Modular Curb appeal/cost
Community involvement
Awareness Fulfill the promise Fabric of community
Academic accountability
Establish program Measure program Continuous improvement
Operational support
Outside experts Transitional resources
In-house team
12Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
• Different structures of working capital– Receivable sale– Term loan– Line of credit
• Facilities financing options– Lease option– Bond– Traditional bank loan
• Regarding costs of funds, all costs are NOT created equal– Evaluate total $ cost rather than % rate– Consider fixed transactional costs and penalties, in addition to annual rate related
to costs
Finance considerations
Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
The Start-up Phase
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STAGES OF GROWTH
Start-up
Common MisperceptionsFounding team to “create” best practices
“If you build it, they will come.”
15Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
Start-up
The ChallengesFinding good leadership and teachers
Securing resources
Finding suitable facilities
Healthy enrollment
Sustaining high performance as network expands
16Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
Start-up
Best PracticesStudy and meet with schools doing things well
Don’t be a master of everything. Master a few things and do them really well
Build genuine and robust relationship with teachers, leaders, vendors, and external constituents
Pay close attention to the budget
Pay even closer attention to student progress data
Do not waiver in your belief or mission
Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
The Growth Phase
18Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
Growth
Common Misperceptions“After the 3rd year, all will be in place and it’s smooth sailing!”
Performance and accountability requirements will be stagnant
Done with professional development
No need to change routines or systems
We’ll have sufficient funds from operating revenue to support expansion
Facility upgrades will be minimal, if at all
19Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
GrowthChallenges
Maintaining high expectations and being flexible
Advancing levels of student performance
Managing growth with limited resources
Upgrading systems to support growth
Retaining quality teachers and leaders
Matching capital to operational needs
20Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
Growth
Best PracticesContinuous professional development and leadership training
Build on the culture
Focus on individualized instruction and data analysis
Increase visibility in the movement
21Copyright © 2013 Charter School Capital, Inc.
Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
The Sustainable Maturity Phase
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STAGES OF GROWTH
Sustainable maturity
Common Misperceptions
The snowball effect
Time to cash in
Challenges decrease as you scale
23Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
Sustainable maturity
The Challenges
Focus, Engage, Act
Right team on the right bust in the right seats
Recalibration
24Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
Sustainable maturity
Best PracticesBe mindful of the “tipping points”
Strategic enrollment = Stable performance
Develop data-driven culture and retain the passion that got you started
Celebrate your successes and analyze your failures as strategic opportunities
Develop pillars that define what you do – core strategies for your “preferred future”
Assess all management systems regularly and use assessment to improve
Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
Recap
26Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
Recap
Start-up Growth Sustainability
Financing Any liquidity Flexibility/scalability
Cost
Facilities In target locale Modular Curb appeal/cost
Community involvement
Awareness Fulfill the promise Fabric of community
Academic accountability
Establish program Measure program Continuous improvement
Operational support
Outside experts Transitional resources
In-house team
27Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
STAGES OF GROWTH
• Stages in charter school lifecycle present very different challenges
• Strategy and focus needs to vary significantly as you grow
• Leverage experts at every stage to allow you to focus on educating kids
• Financial analysis illuminates positive potential impact of growth and scale
Key takeaways
Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
Questions?Presentation available at: CharterSchoolCapital.org/Webinars
29Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.
Thank YouPresentation available at: CharterSchoolCapital.org/Webinars
Stuart Ellis, [email protected]
Ron Packard, [email protected]