Christopher Whittle, the education
entrepreneur whose company lost more than $300 million running
public schools, is opening a for-profit private school in New
York City headed by veterans of Phillips Exeter Academy,
Hotchkiss School and Dalton School.
Backed by $75 million in private financing, Whittle, 63, is
responding to parents’ demand for spots for their children in
the most selective private schools, he said in an interview on
Jan. 27. Whittle aims to build a chain of more than 20 schools
in cities worldwide, including London, Shanghai and Mumbai, he
said.
Investors may be leery of the for-profit institution,
called Avenues: The World School, after Senate hearings raised
questions about the cost and quality of for-profit colleges,
said Trace Urdan, an analyst with Signal Hill Capital Group in
San Francisco. Avenues also lacks the cachet of New York’s top
private schools, Amanda Uhry, a private-school consultant, said
in a telephone interview.
“The New York parent who can afford this — they want
Fieldston, Horace Mann, Trinity,” said Uhry, founder of
Manhattan Private School Advisors, listing three selective New
York private schools. “They have 20 schools in their mind, and
that’s it.”
‘All-Star’ Management
Avenues World Holdings LLC plans to open its first school
in September 2012 in Manhattan’s Chelsea neighborhood and will
start taking application inquiries tomorrow. The school will
charge about $36,000 a year, about the same as top-tier private
institutions, and can compete with 200-year-old rivals because
of its “all-star” management team, Whittle said.
Avenues’ co-heads are Tyler Tingley, who led Phillips
Exeter in Exeter, New Hampshire, for 12 years, and Robert “Skip” Mattoon, who ran the Hotchkiss School in Lakeville, Connecticut, for 11 years. Gardner Dunnan, academic dean, led
Dalton in New York for 23 years.
Benno Schmidt, the former president of Yale University in New Haven, Connecticut, will be chairman of Avenues. Schmidt co-
founded New York-based Edison Schools Inc., the public schools
operator, with Whittle in 1992.
The school wanted to “assemble a leadership group so
parents just go ‘Wow!’” Whittle said.
Tingley, who retired from Exeter in 2009, wouldn’t disclose
his pay at Avenues. At Exeter, in the year ended June 30, 2009,
Tingley received $1.15 million in compensation, according to a
tax filing. Of that sum, $354,000 was salary, and the rest was
deferred compensation and benefits, Tingley said.
‘About the Excitement’
“They’re paying me well, as Exeter did, but this isn’t
going to change my standard of living,” Tingley said. “It’s
all about the excitement.”
To attract families that want their children to compete in
a global economy, Avenues will require all students become
fluent in a second language and take a “world course” that
stresses non-Western history, geography and issues, according to
the school’s marketing materials.
About 6 million students — or about 11 percent of U.S.
schoolchildren — attend more than 33,000 private schools in the
U.S., including parochial institutions, according to the U.S.
Education Department. The average tuition is about $10,000.
There are about 3,000 to 4,000 for-profit elementary and
secondary schools in the U.S., said James Williams, executive
director of the National Independent Private Schools
Association, which represents for-profit schools.
Avenues has little in common with for-profit colleges,
whose students depend on federal money for loans, Whittle said.
“We take not one dollar of government money,” Whittle
said. “That has been the core debate area and we’re not
involved with that.”
Avenues will contribute $4 million a year from its tuition
revenue to financial aid, Whittle said.
Edison’s Contracts
Edison had public contracts to operate schools in cities
such as Philadelphia, Detroit and San Francisco. In the
2002-2003 school year, Edison enrolled about 80,000 students in
149 schools in 22 states and the District of Columbia, according
to a Securities and Exchange Commission filing.
Edison went public in 1999 at $18 a share and peaked at
$36.75 in February 2001. A group of investors, including
Whittle, took the company private in 2003, acquiring it for
$1.76 a share. At the time, the company had run up more than
$300 million in losses since its founding, according to an SEC
filing. The company is now called EdisonLearning Inc.
Whittle’s failure to deliver on his promise — of running
public schools more efficiently while turning a profit — raises
questions about the credibility of his latest venture, Henry Levin, director of Columbia University’s National Center for the
Study of Privatization in Education, in New York, said in a
telephone interview.
Whittle’s Difficulties
Whittle “is a marketer par excellence,” said Levin, a
professor at Columbia’s Teachers College. “He’s lost a lot of
money for a lot of people. He’s got a track record on that.”
Edison had difficulties because it was a pioneer in a
movement to overhaul public education through charter schools,
Whittle said.
“It was tough, it was very hard,” Whittle said. “We had
our ups and downs, as anybody in the charter movement did.”
New York City already has individual for-profit schools
owned by their administrators, said Ronald Stewart, headmaster
of Manhattan’s for-profit York Preparatory School, which he
founded in 1969. London-based Word Class Learning Group oversees
British Schools of America and is opening a school called World
Class Learning Academy in Manhattan’s East Village in September.
To contact the reporters on this story:
John Hechinger in Boston at
jhechinger@bloomberg.net;
Oliver Staley in New York at
ostaley@bloomberg.net
To contact the editor responsible for this story:
Jonathan Kaufman at
Jkaufman17@bloomberg.net.
Article source: http://www.bloomberg.com/news/2011-01-31/whittle-taps-exeter-dalton-veterans-to-start-new-york-school.html