Departures at Gates Foundation Stir Speculation About Its Plans for Higher Ed

In the span of just a few months, two high-level officials at the higher-education arm of the Bill & Melinda Gates Foundation have left or announced plans to depart. This being Gates, the largest philanthropic player in postsecondary education, the departures of Daniel Greenstein and Heather Hiles have prompted speculation about the future direction of an operation that now awards about $125-million a year in grants.

Greenstein, who announced this month that he would be stepping down in March as director the foundation’s Postsecondary Success program after six years, said in an interview with The Chronicle that he doesn’t expect major changes. The job posting for his successor, he predicted, will say “very clearly that they’re looking for a director to execute on the existing strategy.”

In its simplest form, the strategy calls for raising the educational-attainment levels for low-income and minority students by improving the retention and graduation rates at the institutions that enroll the greatest number of such students. It also aligns with the foundation’s burgeoning plans for more spending on projects to promote economic mobility in the United States that Bill and Melinda Gates recently highlighted in their annual letter.

Greenstein said the foundation spent a decade homing in on the approaches it backs to accomplish the strategy: online education in concert with face-to-face instruction, predictive analytics in student advising, “pathway” curricular strategies and proven developmental-education techniques to keep students on track toward their degrees, and collecting more meaningful data about students’ progress. While he and others at the foundation say that the new director will certainly have leeway to shape the program, Greenstein said shifting course, “would be, in my view, ill-advised.”

Nonetheless, people familiar with the foundation’s work in higher education, including some current and former grantees and former program officers, say the selection of the next director could and should be an opportunity for the foundation to broaden its scope to include more support for organizations that promote options beyond traditional colleges and fresher approaches within academe.

Many saw Hiles, a deputy director, as an advocate for doing more with nontraditional organizations in education. She recently left after only about a year in the job. Hiles declined to comment on the reasons for her exit. Greenstein would say only, “That happens.”

Whether Hiles’s short tenure was the result of a policy difference or a bad personnel fit, several people familiar with the foundation say her departure is emblematic of something bigger: a tension within the Gates education programs between those who favor working through existing channels and those pushing for support of educational entrepreneurs and for options that might prepare people for careers but that don’t necessarily involve college certificates and degrees.

The Gates program supports groups like Jobs For The Future, the American Association of Community Colleges, the Aspen Institute, and Educause. More recently, it’s doubled down on its institution-oriented focus with grants to a consortium of 11 public colleges called University Innovation Alliance and to a collection of 29 colleges and two state systems it calls the Frontier Set. Just this week, the Association of Public and Land-Grant Universities announced it was receiving a $1.2-million, two-year Gates grant to develop a Center for Public University Transformation to help its members produce more college graduates.

The Lumina Foundation, another heavyweight in higher-education philanthropy, has intentionally taken a broader view. While it too has backed projects like the University Innovation Alliance, it also supports efforts to promote greater recognition of the value of industry credentials, for example, as well as projects aimed at remaking accreditation and community-based partnerships to promote educational attainment for adults and younger students. At Gates, “their lens seems to be more focused on institutional partnerships,” says Jamie Merisotis, Lumina’s president and CEO. Lumina spends about half as much annually as the Gates higher-education program does.

Some observers see the current Gates strategy as a welcome sign of discipline, and the growth in the program’s budget — up from $76-million in 2013 — as a vote of confidence from the foundation’s top leadership. But that still leaves many hoping that the foundation will use its time of transition as an opportunity to tackle edgier projects.

Jason Palmer, a former deputy director in the postsecondary program, is among those. “The foundation has a strong gravitational pull towards investing in traditional intermediaries, large urban-serving universities, community colleges and HBCUs,” he said in an email message. Those institutions “serve large numbers of disadvantaged students (which is a strong positive in their favor), but these are not always the most innovative institutions.”

Palmer, now a general partner at New Markets Venture Partners, which invests in education companies, says he and others within and outside the foundation would like to see it investing more in projects such as those that promote competency-based education or accreditation reform, “where potential grantees are often asking for less money and promising faster, leapfrog-like progress.”

‘Hostile’ Regulatory Environment

The Gates postsecondary program has evolved over the past decade. Under its first director, Hilary Pennington, it was very focused on community colleges. Under Greenstein, who worked previously for the University of California system, the foundation’s grantmaking expanded to include many more four-year institutions. Under Pennington and continuing under Greenstein, the foundation has also spent tens of millions of dollars on programs that supported new kinds of postsecondary organizations (it called them breakthrough models), and grants to several companies that developed “next generation” courseware. Those are digital courses from companies like Smart Sparrow, Acrobatiq, and the Open Learning Initiative at Stanford University that incorporate data-driven tools that adapt as students progress through the material. Both of those grant programs have since wound down.

The foundation had big ambitions for the courseware program. Its goal was that the entry-level courses used by numerous campuses would together enroll more than one million students from fall 2015 through fall 2017. The foundation funded 36 courses (10 more than planned) but fell short of its ambitious enrollment goals by more than half.

The decision to end the grant programs was a combination of practicality and philosophy.

“The regulatory environment is so hostile to new entrants,” he said, referring to the reaction to the breakthrough models, which included a project called Ivy Bridge College, which eventually was shuttered by an accreditor. “So we pulled away from it,” he said. And while the foundation says the $25-million courseware project won high marks from faculty members who used the courses, as Greenstein himself acknowledged, they “struggled to gain a strong foothold in the market.”

In the end, Greenstein said, the decisions made the most sense for the foundation’s broader goals. “Our job isn’t innovation. Our job is to improve students’ lives.”

The decision also reflects the challenges that any director of the postsecondary program faces. Josh Jarrett, another former deputy director who spent who seven years there before leaving in 2013 to start a company called Koru, says the job has long required finding a balance between ideas that will satisfy “the boldness” that the Gateses demanded but also “honored the field” and its expertise.

In other words, the director needed political skills that face both inward and outward, while the foundation, to be credible and effective, had to avoid offending traditional higher-education constituencies while still promoting cutting-edge ideas.

Even with $125 million a year to spend, Greenstein says the foundation will inevitably disappoint some people. “One of the most difficult things I encountered here is the tradeoff” involved in ending a program like the one for breakthrough models, he said. “We were disappointing to the competency-based education folks too.”

Greenstein looks back on his tenure with satisfaction. “The pace of change is slow” in higher education, but that’s not necessarily bad, he said. “I actually value the reasons that we’re slow.” At the same time, other signs — like the growing rates of adoption of online education, the wider use of data-driven advising, and the way the higher-education conversation has shifted to college completion and value, not just access — are all indicators of action. “And we contributed to that,” said Greenstein.

He will step down from his role on March 15 but will continue with the foundation until at least June, assessing the nature of the outside expertise that is available to college leaders who are managing change at their institutions. Greenstein said he hasn’t decided on his next career move — perhaps a college presidency, for an institution “that’s at an inflection point.” And given the current political environment, he also plans to continue speaking out about higher education.

“We all have to raise our game to extract education from the jaws of the culture wars,” he said, “while being honest with ourselves about the things we need to correct in the industry.”

Goldie Blumenstyk writes about the intersection of business and higher education. Check out www.goldieblumenstyk.com for information on her book about the higher-education crisis; follow her on Twitter @GoldieStandard; or email her at goldie@chronicle.com.