The Walton Family Foundation’s K-12 education program director is resigning from his role to start an independent K-12-focused investment fund.
With the assistance of a $200 million contribution from the Walton family, Marc Sternberg today is launching A-Street Ventures, an investment fund that will seed and scale innovative K-12 student learning and achievement solutions for students, families, and schools, according to a letter Sternberg wrote announcing his departure and the initiation of the fund.
“As the future of work shifts toward artificial intelligence, automation, and outsourcing to foreign countries, the financial security of, and accessibility to, America’s middle class has never been more in doubt,” the letter says. “In this new world, opportunity and stability will belong to young people who can adapt, think critically, continue learning new skills, thrive in collaborative environments, and lead teams.”
The announcement comes as the education space has seen a recent surge of venture capital investment. Investors put more than $16 billion into ed tech in 2020, roughly double the amount that VCs put forward in 2018, according to a report by HolonIQ.
A-Street, which will be based in Bentonville, Ark., plans to invest in a mix of early-, growth- and late-stage ventures. At the outset, it will focus on digital-first instructional materials and “new paradigms” for student assessment, the letter says.
In terms of assessment platforms, the firm will direct its attention toward curriculum-embedded products that can be used for both summative and formative purposes, to shape instruction and support students and their families, Sternberg told EdWeek Market Brief in an interview.
In addition to its focus on assessments, A-Street will attempt to distinguish itself from other investment funds by focusing on uplifting the teaching profession and supporting high-quality, digital-forward content, he said.
In contrast with most education investment funds, which have a seven- or 10-year outlook, A-Street will look to bolster target companies for at least 15 years before exiting, he said.
The fund plans to primarily focus on companies operating in the U.S. K-12 market, but may also invest outside the K-12 sphere when potential breakthroughs could benefit primary or secondary schools, Sternberg’s letter says.
A-Street will redirect profits toward charitable causes or future investment, though the firm intends to operate with “all the rigor and ambition of a traditional closed-end investment fund,” according to Sternberg.
The fund will be financed solely by the Walton family, he said during the interview. Instead of going back to the investors, funds will be recycled into the current fund and for future accounts. The new firm has not yet communicated with any education companies about investment possibilities, he said.
Sternberg previously worked as the senior deputy chancellor at the New York City Department of Education, after serving as a principal and teacher. He will continue as a senior adviser for the Walton Family Foundation, he said in his letter.
“To the entrepreneurs and the idea-makers: we look forward to supporting your vision,” Sternberg wrote. “Now is the moment for your big thinking, new approaches, and finding common ground that advances progress.”