Organization provides new model for third revenue source
Christian Education Enterprises provides a new method for social capitalists to invest in Christian schools and for schools to access funds to start-up revenue generating projects.
The corporation, which is the brainchild of Christian Schools International, has raised $600,000 in its first year of existence.
The investors have family foundations and demonstrate a passion for Christian education with a history of Christian education funding.
“What the investors are looking for is just new thinking around how can we sustain Christian schools,” says David Koetje, Christian Schools International president and CEO.
For long-term sustainability there needs to be a third revenue source beyond parent tuition dollars and donated dollars, he says.
The equity partners are willing to risk investment at a potential five per cent rate of return and invest a minimum of $100,000 for at least a five year period.
Christian Education Enterprises operates as a non-profit corporation, with the rate of return in effect when projects show revenues in excess of expenses.
“There is an element of risk,” Koetje says. “This could in fact end up being a donation because we thought we were going to be successful and we’re not.”
The investors are intrigued that there is an entity in place that exists to take the financial risk to try new projects, and they would be more disappointed if the equity money isn’t used than to try things and have them not succeed, notes Koetje.
One of the projects Christian Education Enterprises has developed is an intergenerational learning community. This project brings senior citizens and school age children into the same learning environment.
When a school expresses interest in a project such as the intergenerational learning community the next step is a market analysis to determine whether the project might be successful. If the market suggests success a financial profile is created as it relates specifically to that geographic region and a competitive price point developed.
After the numbers are worked out the next step is a meeting with the school’s leadership community to explore how to make the project happen. If the project requires land Christian Education Enterprises would lease the land from the school.
Christian Education Enterprises would take on the project including building, marketing and hiring. The school watches to see how the project is going and after some observation decides whether or not they would like to buy it from Christian Education Enterprises at the construction and operation cost. Over a period of time the school can purchase the project using corporate profits from the entity.
A 29-bed unit intergenerational learning community project is currently underway at Rehoboth Christian School in New Mexico. If the project does as it is profiled it should generate $150,000 to the school.
If a school has its own idea for a revenue generating project it can contact Christian Education Enterprises with the concept. Currently a Washington State school is looking at the development of an organic farm.
Christian Education Enterprises is a form of social business, says Koetje. The thinking started with the fact that millions of private equity dollars are being put into education worldwide. Drilling down from that there is a subset of social capitalists, within that a subset of Christian social capitalists, and within that a subset of Christian education social capitalists.
“We invest in those things that do social good and try to drill right down from that to social good; meaning Christ-centred, Christian education,” Koetje says.
Christian Education Enterprises’ dream is to become an international organization and a model to be duplicated in different locations, with possible connectivity between them.
Christian Education Enterprises is an acknowledgement that expanded thinking needs to take place but Christian education will always want to be an avenue for individual philanthropy, says Koetje.
For information about Christian Education Enterprises or if you are interested to pursue a project contact David Koetje at dkoetje(at)csionline.org or 800-635-8288.
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