2024 Education Sector Deal Recap: Increasing Volume Offers Momentum into 2025
February 12, 2025 BlogEducation sector transaction activity bounced back in 2024 following the plummet experienced in 2023. Announced deal volume was…
In 2025, K-12 districts will navigate a landscape defined by a new administration’s push for school choice, rapid technological innovation, and pressure to innovate their program and operations. How will they adapt?
Our K-12 team shares their predictions for the year ahead. From policy and enrollment to the deepening commitment to student wellness, these hot takes capture the challenges and opportunities shaping the sector’s future. Which are most relevant to your organization? How will you respond?
The Trump administration’s (extremely unlikely) shuttering of the Department of Education grabs headlines, but one education policy idea that should get real attention is the federal tax credit scholarship (TCS) program, which made it through the House committee this past September. While the proposal of a federal TCS is not new, this is the first time a TCS bill has made it to the House floor. As the incoming administration and Republican Congressional leadership look for early wins, and with school choice a priority for Republicans, the chances of the Educational Choice for Children Act passing are relatively high. What impact will its passage (or failure) have on the school choice landscape?
District leaders are struggling with staffing shortages, especially in specialized roles like STEM and special education. In turn, schools and districts often rely on “Band-Aid” solutions like hiring contractors from staffing agencies to fill positions before the school year begins. While these partnerships provide critical relief, and are likely to remain part of the fabric of districts long-term, they are one of several solutions the K-12 sector will be focused on.
To drive lasting improvement, the Center for Analysis of Longitudinal Data in Education Research (CALDER) has launched a 5-year study to assess the impact of 13 policies to address teacher shortages, which include licensure reforms, financial incentives, and working condition agreements. These will be evaluated in nine states to determine the impact on student outcomes and teacher turnover. Will these policies drive innovative workforce solutions—and long-term stability and recovery—that K-12 districts desperately need?
Let’s stop marketing and selling “AI-powered this” and “AI-enabled that” in 2025. Instead, let’s commit to solutions that enable districts, schools, and educators to solve the real problems they need help with today. If organizations can deploy AI technologies to deliver products and services that drive better outcomes for K-12 customers, that’s terrific. But we should avoid the buzzwords that bring very little value to customers from a decision-support perspective.
The one area that requires over-investment is AI literacy. We should promote and accelerate those organizations striving to help administrators, teachers, parents, students, and their broader communities better understand this emergent technology and how they might engage with it in a teaching and learning environment. What are the opportunities that should excite and inspire them? What are the policies and practices we need to facilitate responsible use and trust? What is that saying about teaching a person to fish…
What does a comprehensive approach to student success and wellness look like in K-12? In a time of crisis, it’s natural for districts to ask this question.
Student success has always been a cornerstone of Higher Education; the advisory unit of most colleges and universities will measure and monitor the academic achievement, engagement, and personal growth of students (see Tyton Partners’ Driving Toward a Degree franchise). To support this, there is a vibrant marketplace of student success technology and services.
In K-12, we hear from nearly every district about their Multi-Tiered Systems of Support (“MTSS”) framework. But what does this look like in practice? One district may use guidance counselors to mentor students; another may offer social-emotional learning programs and provide school-based mental health services. Virtually all find these divorced from core academic instruction. Let’s get ready to have an earnest conversation about how districts can support holistic student success, and keep an eye on the businesses that start to solve for this.
The exodus of families from public school systems shows no signs of slowing down. Data from our upcoming Choose to Learn publication reveals that enrollment in alternative school models held steady in 2024, with a quarter (23%) of parents indicating their child is enrolled in a non-public school (consistent with 25% of parents in 2022). As family demand for alternatives persists, and momentum at the federal and state level for school choice intensifies, there’s reason to believe that alternative school providers will see significant new dollars entering the market in 2025. Movement out of system in the wake of the pandemic has been primarily driven by safety concerns and a desire for programs more purpose-built around their student’s interests and needs. Providers that can speak to parents’ core safety needs, while also demonstrating how their program drives personal and academic outcomes, are best poised to capture this strong demand.
Even in an uncertain economy, extracurricular activities that children love will remain a priority—but rising costs are driving families to demand more value. As school budgets face pressure, parents will increasingly depend on ‘out-of-school’ enrichment providers to pursue programs that engage their children and foster passion. Meanwhile, private equity’s growing presence in the space is driving franchising and roll-ups, intensifying competition and forcing providers to adapt pricing models and find new ways to differentiate. As demand and competition increase, K-12 student enrichment providers will be positioned to capitalize on parent demand – as long as they can keep pace with an evolving marketplace.
Traditionally, parents have carried the responsibility for their children’s mental and physical well-being. Facing soaring student needs and persistent staffing shortages, districts are partnering with external providers to provide critical mental health support and interventions at scale. But as student needs grow, schools will expand their role in overall student health. For example, schools are now partnering with private providers to deliver school-based medical services and on-demand care; in certain circumstances, this will help them tackle chronic absenteeism and keep the most at-risk students in school. Looking ahead, schools will rely on partners not just to scale existing services, but to pioneer new models that can keep students healthy and focused on instruction.
K-12 business leaders must balance near-term execution with space to reflect on—and plan for—the future. Success will come to those who think expansively about opportunities at the intersection of new markets and innovative models that support K-12 programs, technology, and workforce-related needs
While questions remain about the pandemic’s ripple effects and the priorities of the new administration, investing in K-12 education will remain paramount. All things considered, our future depends on it.
We welcome your perspective on these hot takes. Please reach out below to give us your opinion.