Why Invest?
Why Invest in CMOs
CMOs have demonstrated the ability to scale effective school models in a way that is unprecedented in U.S. education. During the scale-up phase, however, philanthropic investment in CMOs addresses a critical financing need. It addresses the central operating deficit between when a CMO staffs up to undertake an expansion campaign and when the central office breaks even on management fees from schools in the network. This philanthropic contribution is temporary, however, because management fees come out of public revenues -- an income stream that should sustain network operations at full scale.
Return on Investment
CSGF makes each investment with an expectation of the following in terms of a return:
| Target Area | Fund II Plan Objective |
|---|---|
| Investments | Using a rigorous screening and due diligence process, CSGF will invest in the scale up of 40 to 45 of the highest performing and most promising CMOs across the country. |
| Portfolio Performance | The CMOs backed by CSGF will significantly out-perform their local and state level comparables on student academic performance, high-school graduation and college-going rates. |
| Market Share | Several of the CMOs in CSGF's portfolio will achieve significant market share in the local community. All of CSGF's portfolio members will dramatically increase the number of low income students going to college in their local geographies. |
| Growth | Based on CSGF's investments, the CMOs in CSGF's portfolio will serve an additional 225,000 students over the next several years. |
| New Models | CSGF investments will enable the development of several new CMOs that are developing new models using technology-based instruction more effectively and efficiently at scale. |
| Sustainability | CSGF's portfolio will reach financial sustainability on public revenues at scale over the next decade. |
