SOURCE: The Bridgespan Group

The Bridgespan Group

July 12, 2016 16:54 ET

New Study Highlights Returns of 5:1 to 11:1 for Investments in Early Childhood Development

Bridgespan Group Paper Shows How a Billion Dollars of Early Childhood Philanthropy Can Create Economic Opportunity for Hundreds of Thousands of Americans

BOSTON, MA--(Marketwired - July 12, 2016) - A new report from The Bridgespan Group, "Billion Dollar Bets to Increase Early Childhood Development," highlights $1 billion of philanthropic investment focused on children from birth to age 5 that could put hundreds of thousands of low-income Americans on an upward mobile trajectory. The paper is part of The Bridgespan Group's research project, "Billion Dollar Bets to Create Economic Opportunity for Every American," which offers a data driven, field-informed perspective on 15 pathways to make investments of $1 billion that have the potential for sustainable change at scale. The paper features calculations for targeted outcomes in early childhood investments, demonstrating that large amounts of philanthropic capital would have the potential to deliver returns of $5 to $11 on every $1 invested.

"With new research definitively showing that the foundation for life success begins in a child's earliest years, our team set out to identify types of investments to help us move towards a future where all children in the U.S. have access to high-quality developmental experiences," said Debby Bielak, a Bridgespan partner and co-author of the paper.

According to research from Bridgespan and the J.B. & M.K. Pritzker Family Foundation recently published in Achieving Kindergarten Readiness for All Our Children, 5.8 million children nationwide are not on track to succeed as they begin kindergarten. This problem is even more prevalent in low-income communities -- in any given year, 1 million low-income 5 year olds are not fully ready when they enter kindergarten.

"The growing body of research on the barriers impeding the healthy development of children from birth through kindergarten has created a unique opportunity for philanthropists to fund initiatives that can support parents, caregivers, daycare providers and pre-K instructors," commented Devin Murphy, a manager at Bridgespan and co-author of the study.

The primary investment approach outlined in this paper focuses on increasing early childhood development through technology, research and innovation. Working with field experts and practitioners, Bridgespan detailed how to invest $1 billion across the following six areas:

  1. Develop a tool to map health and developmental assessment results to programs and services
  2. Research the field of kindergarten-readiness assessments
  3. Evaluate the field of early childhood tech-enabled tools
  4. Scale existing, evidence-based organizations that offer low-cost tech-enabled tools to support early adult / childhood interactions
  5. Support venture capital investments to develop tailored tools for low-income and diverse families
  6. Fund evaluation and refinement of tech-enabled tools

"In 2016, Forbes reported that there were 159 tech billionaires, and four of the 10 richest people in the world made their money in tech. However, to date, Bridgespan's research has shown that there have been very few philanthropic investments of $10 million or more in social change. Our hope is that this research will help more of these tech billionaires see how they can create significant social change by investing in the very industry that brought them such success," commented Bielak.

"The first two investments are designed to fill a gap in our understanding of how to effectively link early childhood development diagnostics with the right suite of programs and services, and will not need on-going support after their findings are adopted by caregivers. However, the latter four investments to seed the market for tech-enabled tools would be sustainable," explained Rose Martin, Bridgespan consultant and the third co-author of the study.

Added Murphy, "If the investment plays out according to our forecast, approximately 350,000 to 700,000 more children would enter kindergarten ready to learn, leading to a return on investment of $5.5 billion to $11 billion in potential lifetime economic benefit for the individuals and their families."

The paper also outlines two alternate $1 billion philanthropic investment approaches focused on early childhood development. These packages looked at funding a fully integrated suite of services for families, and high-quality, full-day pre-K to low-income children. They build upon the, Achieving Kindergarten Readiness for All Our Children funder guide which highlights a broad menu of thirteen opportunities for philanthropists to support significant improvement in social mobility through early childhood investments.

About The Bridgespan Group,
The Bridgespan Group (www.bridgespan.org) is a nonprofit advisor and resource for mission-driven organizations and philanthropists. We collaborate with social sector leaders to help scale impact, build leadership, advance philanthropic effectiveness and accelerate learning. We work on issues related to society's most important challenges and to break cycles of intergenerational poverty. Our services include strategy consulting, leadership development, philanthropy advising, and developing and sharing practical insights.

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