Craig Barrett’s K12 Inc. has high student “churn” rate

by David Safier

NOTE: Craig Barrett, who is chairman of Governor Brewer's Arizona Ready Education Council (AREC), is one of the eight members of the Board of Directors of K12 Inc., a for profit, publicly traded online education corporation. K12 Inc.'s Arizona Virtual Academy is currently on academic probation with the Arizona State Board for Charter Schools.

A market analysis and investment site, Seeking Alpha, has a long, devastating article about K12 Inc: K12 Manifesting Its Corporate Destiny. A short summary of the very long article: online schools are only valuable for a minority of students, but continued growth is essential for corporate profits. So K12 Inc. uses the hard sell to get more customers/students, knowing many of them will be poorly served and will soon return to a brick-and-mortar school.

The article spends a great deal of time on the "churn rate" at the online schools: the number of students who withdraw each year. The average seems to be about 33%, meaning one third of the students leave the school each year. At Ohio Virtual Academy, the churn rate is 51.1%. (The article did not give figures for Arizona Virtual Academy)

This means two things. First, a number of students and their families are getting themselves into a bad education situation, with the probable result that the students are losing one or more years of education. Second, K12 Inc. schools have to continually recruit new students just to fill the holes left by those who withdraw, knowing many of the news students will be ill-suited for online education.

Teachers spend as much or more time desperately trying to retain students as they do educating them.

Heidi Gardner, an Agora special education lead teacher who resigned last year, said the turnover in enrollment led to a massive expansion in non-instruction work for teachers.

“If you weren’t trying to make initial [e-mail or phone] contact with new students then you were trying to keep on top of the ‘inactive’ [students who had not logged on to Agora’s web portal in a few days] or confirm if students who not been in contact with [teachers] for weeks or months were still enrolled,” Gardner said. “You could add four hours to your work day doing this.”

“When it came to the actual instruction, you’d be a secretary, scheduling in 10 minutes here and there for students who often had complex learning challenges. For the harder cases, [teachers] always put in the time and just carved it out of our lives.”

I've heard other stories. One source told me K-6 teachers don't have to do much teaching, since the parents, who are basically home schooling their children using resources provided by K12 Inc., know enough to tutor their own kids. The job of the teachers is both to nurture relationships with the parents ("Oh, Sarah is doing wonderful work and benefitting so much from the program!") and to try and get them to help recruit new families. Another told the story of someone applying for a teaching job at K12 Inc. Eight of ten interview questions were about what she would do to recruit new students.

Craig Barrett gets lots of media attention because of his education connections with Brewer, and he brags about the successes of BASIS charters, where he is president and chairman. Reporters need to ask for his comments about the failings of K12 Inc, where he is on the Board of Directors. That's part of the story as well, and one he needs to tell.