Why Is the Michael and Susan Dell Foundation Investing in this Indian Ed Company?

Here in the States, and likely in other developed nations, there is a bit of a divide regarding the efficacy of the virtual learning environment versus that of the traditional classroom. This may be especially true when you’re talking about the grade school and middle school levels. In developing countries, however, the argument involves a great number of other factors, not the least of them being the lack of infrastructure and qualified teachers.

The Michael and Susan Dell Foundation recently invested $2 million in the Bangalore-based Edutel Technologies, a company it's been working with for three years. This investment is expected to help the virtual and distance learning company scale its education programs.

So what, exactly, does this investment mean both for Edutel and MSDF?

At its most basic, impact investing is just like it sounds. MSDF invested $2 million in Edutel, and for that investment, the foundation does expect a monetary return—albeit a small one, but a return nonetheless. The difference between impact investing and say, buying shares of Google, is that there is an expectation of non-monetary, social or environmental returns.

As we noted recently, impact investing has recently hit the big time. But MSDF has been in this game for a while now, and we wrote not so long ago about another investment in India by the foundation. 

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Edutel offers virtual education tools to government and low-cost private schools that include programs for traditional academic subject such as science, math, and English, as well as additional programs for competitive exams, and personal skills development. Through the use of a network of satellites that the Indian government provides at a low cost, Edtel’s education programs are delivered by qualified educators and streamed to multiple classrooms across the country.

As we said, Edutel has been working with MSDF for the past few years, and it plans to use its latest investment from the foundation to expand its education centers to additional cities in India. Its new centers will continue the company’s focus of providing a quality education to under-privileged children across the country.

All of this is very intriguing. With vast numbers of Indians still living in isolated rural areas with minimal modern infrastructure, distance learning in this country could have truly transformative potential.