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Privatizing public schools: Big firms eyeing profits from U.S. K-12 market

By staff and wire services reports
August 3rd, 2012

The investors gathered in a tony private club in Manhattan were eager to hear about the next big thing, and education consultant Rob Lytle was happy to oblige. Think about the upcoming rollout of new national academic standards for public schools, he urged the crowd, the Huffington Post reports. If they’re as rigorous as advertised, a huge number of schools will suddenly look really bad, their students testing way behind in reading and math. They’ll want help, quick. And private, for-profit vendors selling lesson plans, educational software and student assessments will be right there to provide it.
“You start to see entire ecosystems of investment opportunity lining up,” said Lytle, a partner at The Parthenon Group, a Boston consulting firm. “It could get really, really big.”

Indeed, investors of all stripes are beginning to sense big profit potential in public education. The K-12 market is tantalizingly huge: The U.S. spends more than $500 billion a year to educate kids from ages five through 18. The entire education sector, including college and mid-career training, represents nearly 9 percent of U.S. gross domestic product, more than the energy or technology sectors…

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staff and wire services reports