Unlocking Potential

Exploring the Private Pay K-12 Student Enrichment Market

All experience is an enrichment, rather than an impoverishment. — Eudora Welty

I’ve been quiet on this platform for several months, in part because I have been devoting attention to some larger projects. One of those is an exploration of the investible student enrichment market. Below is an excerpt from the Foreword of that in-progress piece titled:

A Singular Catalyst

On March 5, 2020, the 24,000-student Northshore district in Washington state announced that it would close and shift to online learning for up to 14 days. On that day, American education changed forever.

“The evidence is now in, and it is startling. The school closures that took 50 million children out of classrooms at the start of the pandemic may prove to be the most damaging disruption in the history of American education.”

— The New York Times Editorial Board, November 18, 2023

By every measure, the effects of the COVID-19 response have been devastating for children in the United States — and five years later, the damage is still mounting. The 2024 National Assessment of Educational Progress (NAEP), the federal government’s most comprehensive measure of student achievement, confirmed what many educators feared: there has been no meaningful recovery. Reading scores for fourth- and eighth-graders fell further below their 2022 levels, which were already the worst in a generation. Math scores, which had offered a glimmer of hope with modest improvement, remained well below pre-pandemic baselines across all tested grades and subjects.^[1] More troubling still, already troubling gaps in educational attainment have widened. Learning losses for students in the bottom 10 percent grew by 70 percent between 2022 and 2024, even as higher-performing students showed tentative signs of stabilization.^[2] The pandemic did not damage American education uniformly. It broke it unevenly — and the fractures are widening.

Against this backdrop, the nation committed an extraordinary sum to the repair effort. Congress appropriated nearly $190 billion in Elementary and Secondary School Emergency Relief (ESSER) funds — more than three times the federal government’s typical annual education outlay — to remediate the effects of school closures and rebuild student achievement.^[3] Those funds have now been fully spent. By any honest accounting, the results are a failure. Achievement gaps between low- and high-income students not only persisted through the spending period but grew. Chronic absenteeism, which surged from a pre-pandemic rate of 15 percent to a peak of 28 percent in 2022, remains stubbornly elevated at roughly 22 to 24 percent nationally — representing somewhere between nine and eleven million students who are missing at least one in ten school days each year.^[4] And the mental health crisis that emerged alongside school closures shows no sign of resolution: the CDC’s most recent Youth Risk Behavior Survey found that 2 in 5 high school students report persistent feelings of sadness or hopelessness — a figure that has risen 10 percentage points over the past decade and remains far above pre-pandemic norms, despite modest improvement from the 2021 peak.^[5] One study suggests the disruption altered the cognitive functioning of children and teachers in ways that may resist straightforward remediation.^[6]

The public system absorbed a historic sum and produced a worsening outcome. That fact is not merely a policy failure. It is the single most important structural condition shaping the private-pay enrichment market today.

Less obvious than the test score data, but perhaps even more consequential for the market this paper examines, is what happened in American living rooms during those 14 days that became 14 months. Millions of parents were given an unmediated view of their children’s education through in-home Zoom classes, and many did not like what they saw — whether the concern was the quality of instruction, the content being taught, or simply the realization that the system they had trusted was more fragile than they had imagined. The response has been neither passive nor temporary.

The most visible expression has been the sustained rise of homeschooling. The number of homeschooled students in the United States has grown from approximately 2.5 million before the pandemic to an estimated 3.4 million today — a figure that now rivals public charter school enrollment and is nearly double Catholic school enrollment.^[7] Critically, this growth has not reversed as schools reopened; in the 2024–25 school year, homeschooling continued to expand at nearly triple the pre-pandemic growth rate, with 36 percent of reporting states recording their highest enrollment numbers ever.^[8] What began as a crisis response has become a considered choice.

The more politically significant expression has been a nationwide sea change in support for public funding of private educational options. Just three years ago, no state offered a universal school choice program. Today, twelve do.^[9] The pace of change in 2025 alone has been remarkable: Texas — the nation’s second-largest state — enacted a $1 billion universal Education Savings Account program providing $10,000 annually per student for approved educational expenses, including tutoring, enrichment programs, and private instruction; Tennessee simultaneously passed its own universal ESA program at $7,000 per student.^[10] Taken together, these developments mean that close to half of all American schoolchildren now live in a state offering some form of publicly funded private educational choice.^[11] The policy tide has turned, and it is moving quickly.

This convergence of forces — documented learning loss, a public system that has proved resistant to repair despite unprecedented spending, a generation of parents radicalized by firsthand experience, the structural rise of homeschooling, and an accelerating policy shift toward family-directed educational funding — has produced a powerful and durable tailwind for the private-pay K–12 enrichment market. This is not a cyclical opportunity. It is a structural one.

While the enrichment market has existed for decades and grown steadily, the United States has historically lagged peer economies in private family spending on supplemental education. Families in South Korea, the United Kingdom, Australia, and across much of East Asia have long devoted a significant share of household income to out-of-school instruction and enrichment — a cultural and economic habit that has not, until recently, taken comparable hold in America. We believe the disruption of the past five years has changed that calculus permanently. The question for investors is not whether this market will grow. It is who will be positioned to capture that growth when it arrives.

Notes & Sources

[1] National Assessment of Educational Progress (NAEP), 2024 Nation’s Report Card. National Assessment Governing Board / NCES, January 2025.

[2] Hechinger Report, “A Dismal Report Card in Math and Reading,” October 2024; American Enterprise Institute, “Many Children Left Behind: The 2024 NAEP Results Indicate a Five-Alarm Fire,” March 2025.

[3] U.S. Government Accountability Office (GAO), “K-12 Education: School Districts Reported Spending Initial COVID Relief Funds on Meeting Students’ Needs,” September 2024. Total ESSER appropriation confirmed at approximately $190 billion across three legislative tranches (CARES Act, CRRSA, American Rescue Plan).

[4] AEI / Return to Learn Tracker (Nat Malkus), “Lingering Absence in Public Schools: Tracking Post-Pandemic Chronic Absenteeism into 2024,” June 2025; RAND Corporation, “Chronic Absenteeism Still a Struggle in 2024–25,” November 2025.

[5] CDC Youth Risk Behavior Survey: Data Summary and Trends Report, 2013–2023, released August 2024.

[6] The 74 Million, “Exclusive: Study Finds COVID Harmed Cognitive Skills of Students and Teachers.”

[7] National Home Education Research Institute (NHERI), “Fast Facts on Homeschooling,” 2025. Homeschool enrollment estimated at 3.408 million for 2024–25, vs. approximately 2.5 million in spring 2019.

[8] Johns Hopkins Institute for Education Policy, Homeschool Research Lab, “Homeschool Growth: 2024–2025,” November 2025.

[9] Ballotpedia, “School Choice in the United States,” updated November 2025; State Policy Network, “Which States Will Expand Education Options for Families in 2025?” February 2025.

[10] FutureEd, “Legislative Tracker: 2025 State Private-School Choice Bills,” May 2025. Texas SB 2 enacted; Tennessee Education Freedom Act of 2025 enacted.

[11] Americans for Prosperity Foundation, “States with School Choice: A Comprehensive Guide to Education Freedom in 2026,” February 2026.