Resilia Research Analysis: Mark Zuckerberg’s Failed $100 Million Newark Educational Foundation
In 2010, Mark Zuckerberg appeared on The Oprah Winfrey Show alongside then-Mayor of Newark Cory Booker and then-Governor of New Jersey Chris Christie. The three were there to announce a $100 million donation ‒ which would subsequently be matched by another $100 million from other grantors ‒ to Newark’s struggling public school system.
What followed was an ambitious and controversial public-private educational partnership that is still being studied and debated to this day. This partnership is important because it was intended to be a model for similar reforms across the country, and the role of philanthropy in public education will remain significant for years to come (in 2018, for example, the Chan Zuckerberg Initiative announced a partnership with the Bill & Melinda Gates Foundation to bring new work in cognitive research into the classroom).
While Zuckerberg’s partnership with Newark achieved some significant gains, it also caused a series of major shocks to the school system (which actually may have had a negative impact on educational performance at the outset), alienated community stakeholders, and failed to leverage local nonprofit infrastructure. All of these issues offer lessons for future public-private partnerships in education.
Community Buy-in Is Crucial
Dale Russakoff is the author of The Prize: Who’s In Charge of America’s Schools? ‒ a book that provides the most exhaustive account of the education reform initiative in Newark. She points out that there was a failure to engage with the community right from the outset, a fact perfectly encapsulated by the way the project was announced: “It played disastrously in the community because, immediately, nobody understood why do we have to turn on ‘Oprah’ at 4 o’clock to find out what's going on in our own city?”
This wasn’t just a perception problem, either ‒ the Foundation for Newark’s Future, the entity formed to distribute the funds, originally required a $10 million donation (later reduced to $5 million) to be on the board. According to a Vox article which drew upon Russakoff’s research, “Ray Chambers, a private equity veteran and longtime donor to Newark schools, tried to change this by coordinating a $1 million donation from Newark residents, to show local buy-in.” But this wasn’t sufficient, so members of the community weren’t represented on the board.
Despite the fact that there were many local organizations that had been working on educational reform in Newark for years, they weren’t able to meet the $5 million threshold. This didn’t mean they couldn’t participate in other ways (and Booker has emphasized the community forums that were held to discuss the project), but it’s clear that there wasn’t sufficient outreach to local stakeholders, which made them feel as if the reforms were being imposed from the top down.
Transparency And Accountability Always Matter
According to Russakoff’s reporting, consultants received $21 million (which in some cases meant $1,000 per day) over the life of the project. While it was undoubtedly important to have experts in data analytics, personnel reorganization, and a wide range of other relevant fields at work on the project, vast sums spent on consultants need to be justified by the specific outcomes they’re capable of securing. Needless to say, when a consultant is receiving $1,000 per day, the return on investment would need to be very high to justify the expense.
Almost one-third of nonprofit revenue comes from government, and as donations become more focused on mega donors and large-scale projects, the standards for accountability will be higher than ever. Meanwhile, smaller organizations ‒ which didn’t receive a large share of the funding in Newark ‒ frequently report that they don’t have the resources necessary to track outcomes. A recent BDO report found that the three top reporting challenges were the lack of a consistent framework, personnel, and resources for gathering “statistics on (the) impact of programs.”
One of the best ways to earn the support of a community is to work with local organizations that have spent years cultivating relationships with stakeholders at every level. But if these organizations want to partner with large grantors on major projects, they have to be capable of demonstrating their effectiveness. We believe that one way for organizations can do this is through the use of technology, which is one of the reasons why we are building Resilia. We believe that organizations shouldn’t be penalized because they do not have the budget or capacity that it takes to present data and deliver reports which is a clear competitive advantage in fundraising. Whether it’s budgeting, evaluations, reporting or tracking impact over time, Resilia has now made it possible for organizations to do this via one solution.
Technology Can Build Relationships And Create Sustainable Change
The educational reforms in Newark achieved several important outcomes. According to a study published by the National Bureau of Economic Research, “Newark saw statistically significant gains in English and no significant change in math achievement growth.” A study published around the same time by MarGrady Research found a range of positive outcomes, such as higher enrollment, graduation rates, and relative improvements in academic performance.
However, the reforms also led to significant disruptions for students and teachers, as well as a breakdown in trust with the community. Although there were plenty of local nonprofits with extensive experience working to improve the educational system in Newark, these organizations (along with many other stakeholders) felt marginalized, while those implementing the program didn’t benefit from their expertise as much as they could have. This is why our mission is to build the platform that bridges the gaps in the nonprofit sector and democratize innovation for the industry.
Considering the fact that 97 percent of nonprofits in the United States have annual budgets of less than $5 million ‒ the amount it would have taken to get a seat at the Foundation for Newark’s Future ‒ it’s clear that future large-scale public-private partnerships should develop ways to be more inclusive. If nonprofits of every size were able to build capacity to track, analyze, and report outcomes to potential grantors and partners, it would lead to more efficient use of dollars and ideally higher impact. Yet, we believe this is not only the responsibility of the nonprofit, but that some of the responsibility also sits with the grantmaker as well. Shared accountability is how we power communities and bring about transformational change.
The Newark project teaches us a lot about the future of public-private partnerships across the board. It certainly had its successes, but there’s no telling how much more effective the project could have been if its leaders had done more to seek buy-in from the community and removed silos that ultimately resulted in less than desirable outcomes. This approach would have allowed them to take advantage of local expertise and resources, and help them determine how to allocate resources in a more inclusive and effective way.