Quality early childhood education is one of the primary building blocks of a healthy, thriving economy. Sounds strange?
Not really. Research shows that investing in high-quality early childhood education helps to create upward mobility by ensuring that all children start out with a foundation for success in school and in life. It’s not only important for children, but it’s equally important for the family. Working families worldwide need quality, affordable childcare. Quality early childhood education positively affects the entire society by preparing individuals to participate successfully in a strong workforce that ultimately results in increased economic growth for families and communities alike.
The early childhood education industry has been hard hit by the pandemic.
According to the Reinvestment Fund, 71.2% of Philadelphia parents used the services of a childcare center pre-pandemic. Once the pandemic hit, that number dropped to 26.8%. Some parents were now working at home and didn’t need childcare, while others lost their employment and couldn’t afford it.
The Pennsylvania Department of Human Services reported that 183 licensed Philadelphia child care providers — about 11% of the city’s pre-pandemic total — closed permanently between April 1, 2020 and March 31, 2021.
Since 2014, the Reinvestment Fund has been investing in the expansion of high-quality early childhood education opportunities throughout Philadelphia by providing business planning support and facilities-related financing to early childcare and education providers.
The first cohort of 15 financial professionals recently graduated from the Reinvestment Fund’s new Train the Trainer (TTT) — a program that will hopefully prevent more providers from closing. Funded by the William Penn Foundation, the eight-week program prepared financial professionals to serve as coaches to early childcare and education providers seeking to strengthen their business operations.
A lot of early childhood education businesses are more focused on the quality of care and programmatic support of the children, and “often the financial side of the child care business falls by the wayside,” said Desmond Hudson, Reinvestment Fund director of community engagement and technical assistance.
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“The thought is, if they could outsource financial support and create systems and automation, it would create better opportunities for operating growth and stability,” he added.
According to Hudson, the program was conceived after it became apparent that child care providers were struggling to provide the financial information needed to get a Paycheck Protection Program (PPP) loan.
“If providers were struggling to get ‘free money’ there are more than likely other aspects of their business that could use some financial support,” Hudson said. “So, we sent out a Request for Qualification looking for financial professionals that were familiar with finances in general and wanted to be trained to support the early childhood education community. No prior experience in the sector was needed.”
The financial professionals received eight weeks of free, virtual training on the early childhood education industry. Now, they will be matched with a local early childhood education provider for 12 months to provide coaching to develop more efficient business practices and will also receive a small stipend during the hands-on cohort.
Each financial coach will assist a provider in goal setting, assessing financial health, bookkeeping services, financial reporting and review, budgeting, forecasting, calculating cost of care, invoicing/fee collection, enrollment coaching, revenue coaching, automation implementation, tax planning and the development of a business plan. Coaches also will work with providers to develop business plans under the guidance of Better Futures, which offers a library of online classes accessible on its CRAFT platform.
Financial professionals in the initial cohort jumped at the chance to participate in TTT.
“My biggest passion in life is to be a valuable resource to my community,” said Jarde Allen, cofounder of In the Moment Financial Services. “In order to be a resource, I need to have knowledge and access that will benefit someone else. This program is specifically targeting an underserved community and that immediately caught my attention. Having the ability to be part of connecting an underserved community to resources that will ultimately put them in a position to do the same is priceless.”
Allen said coming from a tax and accounting background, she was blind to the current state of the early childhood education industry.
“This program opened my eyes to how these programs are truly running behind the scenes,” she explained. “Most have no financial or business acumen to be able to run a profitable and sustainable program. This is not due to a lack of effort, but simply a lack of education around the subject as well as resources devoted to helping them obtain that. Our current niche market at In the Moment Financial Services is small minority-owned businesses. This program has equipped us to dive a little deeper into that niche and specialize specifically with helping early childhood education centers retain and maintain profitability.”
TaLisa Jones, owner of Gyrass Financial Services, said she jumped at the opportunity to partner with the early childhood education industry, which she feels is invaluable to our communities.
“I was looking to participate in an established forum to create and foster business relationships with the early learning sector,” Jones said. “The eight-week training really helped me understand a variety of resources that would be instrumental to helping providers build their business and become sustainable. I learned of the current barriers to high quality education, how this sector is funded, and models and metrics for quality rating. Becoming a financial coach has expanded my business exposure.”
“What excited and attracted me to the program was the emphasis on soft skills,” said financial professional Nate Dixon. “I knew the program would stress hard skills of budgeting and financial planning, which I have gained and developed throughout my 20 years in financial services. However, the training prepared me to be a trusted advisor to early childhood education directors and staff.”
“An important emphasis of the program was for financial professionals to gain a deeper understanding of the day in the life of early childhood education directors and staff — the joy, barriers and obstacles of educating our children,” Dixon added. “They want to be that strategic thinking director. However, they often get sidetracked because they must wear many hats — educator, lunch person, bus driver, you name it.”
Expectations and outcomes
Allen believes it’s her responsibility to put her best foot forward to help providers become financially organized. “Once my client is financially organized,” Allen said, “I will be leaning on the Train the Trainer program to connect me with resources to help stabilize my clients’ business for the long-term and help this client reap the benefits of having a financially-sound early childhood education center.”
Dixon also looks at the cohort as the beginning of an ongoing relationship.
“As your trusted advisor, I will listen and serve beyond just being a bookkeeper and touching bases during tax season,” Dixon said. “I want to empower staff, build rapport and deepen relationships, taking a holistic approach to building a financial infrastructure to sustain a high level of fiscal health for the organization.”
The program is still in the process of matching the 15 financial professionals with 15 providers. The financial professionals have been trained to serve all types of early childhood education providers and the key is narrowing it down to providers that are dedicated to participating in the program.
According to Hudson, TTT is looking for several outcomes from the participants:
- competent financial professionals with a clear understanding of the early childhood education industry
- providers with a better understanding of how standard business accounting practices can support their businesses
- financial professionals with an opportunity to create a new niche.
The bottom line for TTT is simple. “Providers will have a more sustainable business operation which will enable wealth building, retirement and succession planning,” Hudson said. “More sustainable early childhood education businesses will better serve the quality of life for children.”-30-
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