Private equity and preschools
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Anonymous
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I went down a weird rabbit hole today. Here was my path:
Bethesda Country Day school, great reviews and looks nice ----> Their website is weirdly nice/professional for just a preschool, wonder if they are part of a chain ----> oh interesting their parent company is in CA ----> oh they are owned by a private equity firm with Chineese investors ---->some more rabbit holes related to private equity in health care because I work in health administration. According to this report, there are many others. What do you think? They looks corporate, well run, with great reviews but it feels a bit icky. Would especially love to hear from people who have worked for private equity funded (? what the word) daycares or preschools. https://www.congress.gov/crs-product/R48252 |
Anonymous
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Ugh, I'm sure it's the next thing. Like healthcare, real estate, veterinary offices, consumer products, food and beverage. Of course education is next.
On the micro level, there's no reason it wouldn't be a perfectly good environment for a kid. With preschools, teacher quality and ratios is the central. So if the teachers are good and there are enough of them, it's probably fine. It's fairly heavily regulated and a corporate owner will have systems in place ensure they are complying with safety and health regulations. It's probably fine for a kid right now. On a macro level, it's terrible. Private equity extracts value. Long term, their profits will come from increased fees, lowering pay or limiting the number of staff, eliminating any programs that don't offer profit. Expect to pay more for things that didn't used to cost anything. Expect rules like not allowing you to send in lunch or a snack, then charging extra for food that complies with your child's dietary restrictions. Just anything they can do to get another dollar out of you. It's always a bad sign. |
Anonymous
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Elliot Haspel wrote a long article about this and as PP said the biggest issue is the impact on the child care system as a whole: ‘The End User Is a Dollar Sign, It’s Not a Child’ – The 74 https://share.google/AROwsA0mLYsgsEyhl
That being said, Haspel points out that private equity prioritizes profit over quality. Many daycares owned by private equity are well run, but there is no guarantee. I disagree with PP's implication that the corporate ownership gives some additional oversight over health and safety that a nonprofit or locally owned daycare would not have. You really have to assess each daycare individually. Look up their licensing inspection history - this is all public information. I definitely heard of private equity owned daycares that do not keep to ratios and their licensing inspection history reflects that. I have also visited a private equity owned daycare where the teachers looked absolutely miserable, and when asked, the director indicated they have a lot of staff turnover. A good daycare should be able to keep staff (obviously not forever but you shouldn't be seeing totally new faces every week). |
Anonymous
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Both our kids went there a few years ago. We were very happy with it. They have an economy of scale so they have the resources for the parent company to develop detailed curriculum for example.
I had no idea they were owned by some big company until our last year. It seemed more like a local school that was a franchise. Anyway, all the teachers up to the principal didn't seem like "corporate" types and our kids had a great time. |
Anonymous
| I cNt comment on that school but if PE is a trend coming to daycares, that's horrible. Mine is part of a small local chain and for example our ratios are better than the state standard. There is a lot of attention. That is part of the brand and yes it's $$$ (arent they all). I could see PE really "optimizing" staffing in a way that sucks for the kids and lowers teacher retention. They don't have the same attachment to the kids or the quality and reputation of the product, it's all fungible for ROI. |
Anonymous
| Disruption and daycare don’t mix. Look at the disaster that is 2 birds |
Anonymous
| Ugh this is what puts me off of corporate centers. Not that you can’t get good care at them because there are plenty where you can. But ultimately they’re profit machines and that is a completely inappropriate goal for our children’s care. |
Anonymous
Oh yeah. Good example |
Anonymous
If yours is a chain it probably has private equity backing. If it’s not a non-profit, it’s backed by private equity. |
Anonymous
| BIM is another local private owned by a Chinese firm. Not a preschool - instead it is a K-12. |
Anonymous
DP no, small local for-profit chains (e.g. in MoCo Kidsco Jr., Children in the Shoe, Bright Eyes Early Learning) are not likely to be PE -backed. These are typically family-owned companies. PE-backed daycares in our area include Bright Horizons, Childtime and Goddard School. |
Anonymous
| Some franchisors in the preschool space are PE owned but the schools themselves are owned by independent operators. An important distinction. You can have a bunch of schools of the same brand that are completely different. The important thing is how the school owner treats their management/staff and families. Do they prioritize the children and the program and provide good salaries/benefits to attract and retain the best staff or do they cut corners and keep bad staff. Turnover is not always a bad thing at the teacher level. |
Anonymous
PE is still gonna want its money |
Anonymous
| Having different teachers every week is horrible for young children. I'm not talking about schools that let go employees hat aren't working out. I'm talking about when you go drop off or pick up your child and it is always a new face. That is not good and there are many good daycares where that doesn't happen. |
Anonymous
Exactly- i feel like the question i always had was- why am i paying so much while the teachers make so little- and this is prob contributing to that imbalance. I dont want to make rich ppl richer with my kids tuition |