Growth Strategies for Charter Schools Webinar

Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.

Growth Strategies for

Charter Schools

WebinarFebruary 23, 2016

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WELCOME

Stuart Ellis, President and CEOCharter School Capital

Marshall Emerson III, CEOI CAN SCHOOLS

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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 atwww.slideshare.net/CharterSchoolCapital

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Stages of Growth

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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%

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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

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STAGES OF GROWTH

Strategic approach

Start-up Growth SustainabilityFinancing

Facilities

Community involvementAcademic accountabilityOperational support

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STAGES OF GROWTH

Strategic approach

Start-up Growth SustainabilityFinancing Any liquidity

Facilities In target locale

Community involvement

Awareness

Academic accountability

Establish program

Operational support

Outside experts

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STAGES OF GROWTH

Strategic approach

Start-up Growth SustainabilityFinancing Any liquidity Flexibility/scalabil

ityFacilities In target locale Modular

Community involvement

Awareness Fulfill the promise

Academic accountability

Establish program Measure program

Operational support

Outside experts Transitionalresources

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STAGES OF GROWTH

Strategic approach

Start-up Growth SustainabilityFinancing Any liquidity Flexibility/scalabil

ityCost

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 Transitionalresources

In-house team

11Copyright © 2015 Charter School Capital, Inc. All Rights Reserved.

STAGES OF GROWTH

Strategic approach

Start-up Growth SustainabilityFinancing Any liquidity Flexibility/scalabil

ityCost

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 Transitionalresources

In-house team

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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

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The Start-up Phase

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STAGES OF GROWTH

Start-up

The Challenges

Overcoming the “if you build it they will come” mentality

Finding good leadership and teachers

Securing resources

Finding suitable facilities

Healthy enrollment

Sustaining high performance as network expands; building best practices

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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 reallywell

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

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The Growth Phase

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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

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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

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The Sustainable Maturity Phase

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STAGES OF GROWTH

Sustainable maturity

The Challenges

Focus, Engage, Act

Right team on the right bus in the right seats

Not time to simply “cash in”

Challenges may increase as you scale

Recalibration

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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

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Recap

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STAGES OF GROWTH

Recap

Start-up Growth SustainabilityFinancing Any liquidity Flexibility/scalabil

ityCost

Facilities In target locale Modular Curb appeal/costCommunity involvement

Awareness Fulfill the promise Fabric of community

Academic accountability

Establish program Measure program Continuous improvement

Operational support

Outside experts Transitionalresources

In-house team

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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

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Questions?

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Thank YouPresentation available at: SlideShare.net/CharterSchoolCapital

Stuart Ellis sellis@charterschoolcapital.org877-272-1001

Marshall Emersonmemerson@icanschools.org