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Why tech investors are getting interested in early childhood initiatives

Reuters/Beck Diefenbach
Bringing up baby, Chan Zuckerberg style.
By Jenny Anderson
Published Last updated This article is more than 2 years old.

In 2015, Mark Zuckerberg and Priscilla Chan welcomed their first child to the world by committing $45 billion in Facebook shares to tackling the ills of the world. One of their initiative’s projects is the Primary School, which integrates education, health, and community support services for disadvantaged families and children from birth.

In late 2018, Jeff Bezos announced that he and his then-wife MacKenzie would commit $2 billion to build a chain of Montessori-inspired preschools, among other things. The venture is called the Day One fund.

In January, the Omidyar Network—founded by Pierre Omidyar of eBay fame—released a report on early childhood highlighting the trends which underscore its two-generation approach to investing in early learning and care in the US.

New money from tech investors is joining established, deep-pocketed philanthropists—the Buffetts, the Kelloggs, the Packards—to invest in early childhood. The newcomers are compelled by the science and economics of early-childhood investment, and the power of technology to support society’s changing demographics, from a rise in the share of dual working parents to increased diversity.

And, of course, they think in moonshots, not minutiae.

“When your approach to philanthropy, like your approach to business, is to want to change the world, as opposed to just improve things a little bit, then education and early childhood rise to the top as areas that are desperate for disruptive rather than traditional thinking,” says Jack Shonkoff, founder of the Center for the Developing Child at Harvard University, which receives funding from the Chan Zuckerberg Initiative (CZI) and Omidyar, among others. 

The attention of the tech giants offers obvious opportunities. They bring oodles of money, much-needed engineering expertise, and the ability to reach billions of people to a field which still justifies its work based on studies of hundreds from the 1970s. Where academics and scientists may look to governments to scale their projects, Silicon Valley’s libertarian streak may lead those who made their fortunes in tech to target families where they are: in the home, in school, on devices, and generally not via taxpayer-subsidized programs.

But what the tech sector offers in bravado and bold thinking, it often lacks in humility. There are few things that demand more analog, human interaction than parenting. So far, that has not been the tech sector’s strong point.

The routes to early childhood

The importance of early childhood initiatives for building babies’ brains, supporting mothers so they can work, and tackling inequality is gaining attention. The likes of Bezos and Zuckerberg are hardly the first to promote early childhood philanthropy in a big way. Bezos’s parents, Jackie and Mike, early investors in Amazon, have been supporters of early childhood research since 2000, building Vroom!, an app with “brain-building activities” for parents to do with children aged 0-5 and Mind in the Making, which aims to boost executive function life skills.

Philanthropies like the Irving Harris Foundation and the W.K. Kellogg Foundation are long-time investors in early childhood, along with the David and Lucile Packard Foundation, the J.B. and M.K. Pritzker Foundation, and the Heising-Simons Foundation. In recent decades, Warren Buffett’s Early Childhood Fund has invested in science, policy, and practice, especially in the financier’s home state of Nebraska.

Many investors come to early childhood attracted by the high returns. Nobel prize-winning economist James Heckman argues there is a 13% return on investment for comprehensive, high-quality, birth-to-five early education, with kids who are enrolled in programs showing better life outcomes, such as health, crime, income, IQ, schooling, along with an increase in mothers’ incomes when they return to work thanks to childcare.

And a new study from two Harvard University economists, which examined 133 historical policy changes over the past half-century in the US, including Medicare and Medicaid expansions and the introduction of food stamps, concluded that direct investments in low-income children’s health and education have historically had the highest payoff, returning every $1 invested with an additional 47 cents.

Others investors come to early-childhood projects by way of other big problems in society: health, education, or jobs.

When Susie Buffett, Warren’s daughter, looked to invest in Omaha public schools around 2000, she asked the system’s superintendent where she might have the most impact for children living in poverty. He asked her to invest in their first five years, so that they could start kindergarten on par with more well-resourced peers, recounts Jessie Rasmussen, president of Buffett’s Early Childhood Fund.

The Chan Zuckerberg Initiative, similarly, focuses on personalization and technology to reduce achievement gaps in education. (CZI did not respond to requests for comment.) Anyone seeking to close those gaps quickly realizes that they start way before school does: research show disparities between kids surfacing as early as nine months (pdf).

Much of this relates to what happens at home. Take reading: For all that is known about the importance of reading to children, only a minority of parents report doing so. In the US, only 38% of infants and toddlers are read to every day, with state averages ranging from a low of 26% to a high of 59%, according to nonprofit Zero to Three (pdf). Just over half of parents sing and tell stories to their kids every day.

Living in poverty makes an already tough task—parenting—tougher. It is hard to be empathetic and cuddle up to read when you are worried about being evicted, or where your next meal is coming from. And when a parent is stressed, babies react. “Stress affects the parts of the brain that lets parents do good parenting,” says Megan Gunnar, a child psychologist and head of the Institute of Child Development at the University of Minnesota. “They are not bad parents, they are good parents trying to parent in an awful context.”

Not surprisingly, by the time disadvantaged children arrive in school, they are significantly behind on measures of literacy and numeracy, but also on self-regulation and social and emotional learning.

“Playing catch-up is really hard,” Rasmussen says. “It’s time consuming, it’s expensive, far too often we fail, and research shows the gap only widens.”

Across the US, 24 governors have initiatives (pdf) related to supporting very young kids. A handful of Democratic presidential candidates are talking up everything from universal pre-Kindergarten to the pervasive lack of childcare in the US. In June, the House of Representatives approved substantial funding increases for many federal early learning and care programs.

Low unemployment rates are also part of what makes childcare a hot topic, especially for politicians, says Rasmussen. “Every field is scrambling to get workers and an integral part of having a productive workforce is having good quality childcare that is affordable,” she says. (Childcare costs more than college tuition in 28 states.)

Bringing it home

Tech execs’ focus on early childhood may be the simple result of them making lots of money and spreading it across multiple areas of interest. For some, it may be partly related to becoming parents at the same time that they become wealthy, making them uniquely aware of how hard it is to be a new parent (even as a billionaire).

“There’s something humbling about first-time parenting and that’s especially striking for people who are used to having control over every aspect of their lives,” said Harvard’s Shonkoff.

Shannon Hunt-Scott set up the Scott Foundation in 2014 with her husband Kevin Scott, chief technology officer at Microsoft, and honed in on early childhood development after getting involved in their children’s preschool. “My kids are having a great educational experience but it’s so specific to their zip code and our ability to provide that,” she says. She was struck by how much need there was locally: “The kids in these communities don’t have access to early childhood anything much less really high-quality early education.” She is now chair of the board of Educare, a preschool program in California, 21 other states, and Washington, DC serving low-income families.

Families in the US are radically changing, becoming more diverse, more tech-savvy, and more centered around work. Two-thirds of children under five live in homes where both parents work, compared with fewer than one in 10 in 1940. Yet parenting is one arena that tech has been slow to tackle, even as science has dispelled the notion that kids start learning at school.

“The solutions are at the verge of adapting to this new parent,” Isabelle Hau, investment partner in education at the Omidyar Network, says. “That’s the opportunity we are investing heavily in.”

Priscilla Chan, talking to Quartz late last year, explained how the birth of their first child prompted her and Zuckerberg into action. “We had that panic of first-time parents: The future is coming in four months, the future is coming in three months,” Chan said. “You realize that you want to have this incredible world for your children.” Zuckerberg cites Chan’s life story when talking about the work of CZI. “You see what’s possible when people have opportunity and you level the playing field,” he told Quartz.

Not so fast

There’s good reason to wonder whether the latest tech titans will invest carefully in early childhood causes, or move fast and break things. Zuckerberg’s $100 million investment in Newark schools, meant to fix a failing district and promote innovation in education, ended up making headlines for its hubris more than its student outcomes. Applying business principles and a “bottom-line mentality” can be taken too far in the context of complex social systems and poverty.

As a result, efforts from tech giants to promote early childhood development contend with plenty of cynicism. When Bezos announced his Day One fund, some suggested that he should pay more taxes and raise workers’ wages rather than donating a sliver of his fortune to his own chosen causes.

Many of the tech industry’s breakthroughs—social media, high-adrenaline video games—seem to disregard deep human needs in the interest of adding more users, gaining more likes, or “connecting people.” Its faith in itself as the solution for society’s ills comes with consequences: addled attention spans, spikes in loneliness, and rising levels of anxiety and depression. It disdains regulation, which usually comes in high doses for anything to do with kids.

While researchers argue whether the lonely and anxious turn to tech, or whether tech makes them anxious and lonely, the science of early childhood is resolute: humans play an indispensable, starring role. Attentive, nurturing care in the first 1,000 days of a baby’s life is what many scientists say builds their brains and lays the foundations for everything from how to manage future conflicts to how to tackle math problems. So far, no app has shown an ability to do that better than a parent.

Unrestricted VC

One welcome trend is that many of the new investors, in aiming for moonshots, are awarding grants in the form of unrestricted funding. That is, funds not tied to a particular program, but rather breakthrough ideas. For example, Omidyar, Buffett, CZI, and the Pritzker Children’s Initiative are investing in Harvard’s Center for the Developing Child to find breakthroughs for young children living in adversity.

Hau, from the Omidyar Network, says this is how Omidyar prefers to work, noting that for the past 15 years “80% of our grants are core funding—grants not tied to a particular program.” This is not the norm: about 80% of philanthropic funding remains directed at programs, she says. Rasmussen concurs, saying Buffett’s Early Childhood Fund trusts the Center for the Developing Child to do the groundbreaking work to reinvent pediatric care.

For all the interest in early childhood, however, investment numbers remain small. According to a Trends in Educational Philanthropy report (pdf), which surveyed 91 education funders, only 3% of overall grant value went to early childhood, compared with areas like K-12 education or workforce development. However, 58% of those funders said they planned to increase support in early childhood causes over the next two years—the highest of any priority in the survey.

“The early childhood club is tight,” says Hunt-Scott, “but it’s pretty small.” The hope is that the influx of money from tech execs will embrace the best aspects of the industry and leave the worst behind. “We need their money,” says one early childhood entrepreneur, “but we also need their chutzpah.”