‘If It Were Easy, Someone Would Have Done It Already’

IDP Foundation

At an Opportunity International conference 10 years ago, Irene Pritzker saw a documentary about shantytowns in West Africa with low-performing schools. The guest speaker focused on slums where development was lacking and opportunities appeared slim. Pritzker wanted to find a way to help, so she traveled to Ghana.

There, she saw how small day care operations, managed mostly by mothers, grew into overstuffed schools of “incredibly dank, dark conditions,” she said. A major problem for families was the lack of mobility, which also hurt the local economy.

Pritzker found a way to help when she was introduced to a Ghanaian entrepreneur, Paulina Nlando, whose efforts showed the impact that small but carefully measured investments could have.

“Paulina had built a wholesale yam-distribution business and was so successful that she was funneling off some of her profits to begin a school,” Pritzker said. She imagined what Nlando and others like her could do with even a small amount of money to invest in opportunities.

After the trip to Ghana, Pritzker co-founded the IDP Foundation in 2008. The organization now has an endowment of $56 million. It invested in Sinapi Aba Trust, later known as Sinapi Aba Savings and Loans, to develop the Rising Schools Program, which lends money for management training to develop low-fee private schools. The microfinance program in Ghana that was inspired by Nlando has helped nearly 140,000 students, and the country’s ministry of education has become a partner of IDP.

The foundation’s work led to several awards for Pritzker, including a Global Philanthropy Award in 2010 from the Foreign Policy Association at the World Democracy Forum. The foundation was also granted special consultative status at the United Nations in 2012.

Pritzker is proud of the awards, but they’re not what drives her. Her major goal as a philanthropist and grant maker, she said, is to go beyond “writing checks.” She wants to invest in more people like Nlando, who are driven to improve life for their families but need access to private capital.

Managing Expectations

The IDP Foundation devotes 57 percent of its funds annually to education, 27 percent to medical research, and 16 percent to advocacy, social-enterprise solutions, and memberships.

Building on the lessons Pritzker learned from Nlando, the foundation also makes small loans to local entrepreneurs. So far, IDP has given 545 loans, mostly in Ghana. The loan repayment rate is 94 percent.

Pritzker acknowledges that impact investing in foreign countries, especially related to education, comes with political controversy. Establishing private and charter schools in poorer cities and towns is now common in the United States, but in some areas of Africa, there are concerns that outside investment in schools will lead to loss of control and threaten local customs.

James Tooley, a professor of educational entrepreneurship and policy at the University of Buckingham in Britain, has faced that issue in his work. He is the researcher whose documentary influenced Pritzker a decade ago.

Like him, Pritzker has argued for more market-based strategies to improve education, especially where governments cannot afford to assist schools. She dreams of seeing a world in which free education is available to everyone, but the world hasn’t come close at all to achieving that, she said.

“The issue is extremely politicized,” Pritzker said. “Many people feel that there should never be any privatization of education, that these types of schools shouldn’t exist.”

Arguments for and against private schools are more nuanced than some people realize, said Susannah Hares, education co-director and senior policy fellow for the Center for Global Development. Pritzker’s decision to fund individual schools — or “mom and pop shops,” rather than larger networks and chains, as other philanthropists do — may be a more pragmatic approach, Hares said.

Overall, the debate is not so much about taking an “either-or” approach, said Prachi Srivastava, associate professor in education and international development at the University of Western Ontario, who coined the term “low-fee private schooling” nearly 20 years ago. The goal for philanthropists, investors, researchers, and government officials should be to acknowledge their potential biases in the debate and make their commercial interests and goals more clear to the public, Srivastava said.

“It isn’t a question of ideology, it’s a question of evidence,” she said, citing the World Bank’s 2018 “World Development Report” and other studies. “If there is private engagement, it should supplement, not filter away or funnel away, resources from building and strengthening existing systems that serve the poor and most marginalized.”

Finding Local Partners

Pritzker agreed that philanthropists must be cautious when working in foreign countries and that swooping into a country with the intent of solving its problems without partnering with people in local communities can be a recipe for disaster.

“You can never start a program like this unless you really get out there on the ground and try to understand the cultural contexts,” she said. “For me, that’s probably been the most energizing and fulfilling aspects of the work, to develop this true empathy.”

She added that philanthropists can sometimes lose sight of important macroeconomic problems that complicate the situation.

“When we started, on average these schools were charging anywhere from $7 to $15 each term, some a little more. Since then, the currency has devalued enormously,” she said. Currently, one U.S. dollar equals a little more than five Ghanaian cedi, making the schools more expensive for local families.

Pritzker said the costs for microfinance loans can be very high because of high levels of risk to lenders in many countries. Nonetheless, she’s found a way to make the model scalable, sustainable, and profitable for multiple parties.

“A lot of foundations do not see their money as catalytic capital. They don’t see that you can take huge risks with your granting to see whether or not it’s possible to create something that will stand on its own two feet eventually,” she said. “Education is one of the more difficult spaces. We have found it enormously challenging but also enormously rewarding.”

Pritzker is associated with a long line of investors and philanthropists, including her daughter, Liesel Pritzker Simmons, who co-founded the IDP Foundation with her mother. Pritzker Simmons was an actress before focusing on philanthropy. She now oversees a separate impact-investing venture, the Blue Haven Initiative, with Ian Simmons, her husband.

IDP Foundation

Philanthropic Family

Pritzker Simmons and her brother, Matthew, both reportedly won a settlement of $450 million each from the larger Pritzker family after a lawsuit. Their mother divorced Robert Pritzker, linked to the Hyatt hotel chain. (Irene declined to disclose her net worth.)

Irene Pritzker received a bachelor’s degree in economics and anthropology from the University of Western Australia in 1971 and also has a master’s degree in English language and literature from the University of Chicago, now the home of her foundation.

Pritzker said she was more comfortable in the past merely “writing checks” for philanthropy, a system she isn’t exactly fond of now. She’s a patron of the arts, opera in particular, and continues donating to cancer and Parkinson’s research at Northwestern. But now, through her foundation, she’s interested in greater diversity in giving.

For example, Sesame Workshop and her foundation partnered in 2012 to support Ghanaian teachers in the Rising Schools Program. They expanded the relationship last year to build more training modules, each incorporating videos of the Muppets asking questions about literacy, social skills, empathy, and other things intended to improve self-confidence among girls.

Taking Risks

Pritzker also plans to expand her foundation’s support for projects in the United States, especially in the Chicago region, in education and the environment. Tutoring Chicago, whose services are provided free with the help of volunteers, is among the foundation’s grantees.

Pritzker said she’s learned some lessons from her daughter about taking risks as a philanthropist. It was not easy entering the private-school arena in Africa, which requires breaking down the skepticism of parents and the government.

In difficult philanthropic efforts, Pritzker’s daughter once explained to her, “if it were easy, someone would have done it already.” Pritzker has taken that advice in deciding what causes the foundation might support next.

Pritzker said the grant maker is working to avoid in its portfolio projects that could be harmful to the environment. “What’s the point of supporting all these philanthropic endeavors if the very companies we’re invested in to yield that wealth are doing bad stuff?” she said.

She doesn’t have plans to phase out the foundation. She’s happy that millennials will eventually take over grant makers similar to hers. She’s also hopeful that they will push family foundations to make more calculated risks and be more visible about making a global difference.

“I would like to be successful in helping change people’s attitudes towards the low-fee private schools and be known as a trailblazer in this field because we took the risks pretty early,” she said. “This is a foundation that took on a difficult situation but proved a concept and provided a model that could be followed.”