From the June 1996 issue of Entrepreneur

Heidi Gold-Dworkin didn't set out to be an entrepreneur; she just wanted to teach her young daughter about science. But when Gold-Dworkin, a scientist with degrees in molecular biology and biochemistry, went looking for children's science classes in her area, she came up empty-handed.

So in 1991, she started teaching classes herself at a local community center for children aged 3 to 12. The first class filled up. So did the second-and the third. Soon, parents across Connecticut were calling to put their children on waiting lists for Gold-Dworkin's increasingly popular class, which mixed hands-on projects with simple lectures about science. Kids learned about why the sky is blue, what makes a kaleidoscope work and similar fun topics.

"Little Scientist was born out of my love of science and children," explains Gold-Dworkin, 36, who with $75,000 turned her classes into a full-time business in 1995 with longtime friend Donna Goodman Lee, 37, the previous owner of a graphic design and marketing business. "I realized there was an incredible market for this [service]." Indeed, the two have decided to begin franchising their successful concept this year.

The Ansonia, Connecticut, entrepreneur shares a common bond with many entrepreneurs who provide children's educational services: Her kids led her to a great business idea.

Neither government statistics nor university studies will confirm that American schools have been cutting back on educational enhancement programs like the one Gold-Dworkin sought for her daughter. But ask any parent, and you'll get plenty of anecdotal evidence that there's a great need for companies offering educational services for kids, whether it's science classes or simply tutoring in reading and writing.

The American Association of Educators in Private Practice (AAEPP) confirms this trend. When the association began in 1990 as a support center for entrepreneurs like Gold-Dworkin, it had just 16 members. Today, its membership has swelled to 500. "The sector of the population [that needs remedial learning] is growing, and I think private practitioners can fill that need," says AAEPP executive director Chris Yelich.

For example, Sylvan Learning Systems Inc., a children's learning center franchise, was hired to take over some of the teaching curriculum in Chicago's public schools, a deal worth an estimated $1.9 million, according to Education Week newspaper. This isn't Sylvan's first foray into the public education sector. It already has inroads at schools in Baltimore; Washington, DC; and St. Paul, Minnesota.

Besides the increased need for remedial education, Yelich believes some school districts are cutting back on extracurricular programs such as art, music and computers.

Kathy Christie of the Education Commission of the States, a nonprofit organization in Denver that works with policy makers nationwide, agrees. "When districts are under extreme budget constraints, they try to keep budget cuts away from academic classes," she says. The first things to go aren't core curriculum classes like math and social studies but classes in other fields often considered "extras."

As school budgets are cut, many school districts are turning to outside services to fill the gap. The East Hartford, Connecticut, public school system, for instance, could afford to bring in Little Scientist to teach eight classes to its elementary school children, thanks to a government grant.

In other cases, parents step in. With High Touch-High Tech, a science-related company in Coral Springs, Florida, parents pay between $4.50 and $6 per student to bring in scientists for what's called an in-school field trip. "Because parents send in money," says Daniel Shaw, who co-founded the company in 1991 with wife Ellen and approximately $15,000 in start-up funds, "it doesn't cost the school district anything." In fact, when the Shaws first pitched the local PTA, one of the selling points was that the school district wouldn't have to raise taxes or cut funds from other programs to afford the company's services.

Learning Curve

For many parents, price is not an issue-helping their kids learn is. Consider the success of Evelyn Peter-Lawshe's Reading and Language Arts Centers Inc. in Bloomfield Hills, Michigan. Peter-Lawshe, 37, first got the idea for her company in 1988, when she was a homemaker who volunteered in her daughter's kindergarten class. "[Some students] were unable to write their names or do basic things I thought kids would need to do to become good readers," says Peter-Lawshe, who herself had trouble reading as a child.

She made such great progress helping those kids, the teacher began sending more and more children to see her both during the school day and after school. By 1991, Peter-Lawshe had opened the Reading and Language Arts Centers with $5,000 in start-up capital.

Peter-Lawshe figured if kids were having trouble reading and writing in a good school, then it must be happening everywhere. Today, parents shell out $40 to $50 an hour for individualized tutoring sessions with one of her 55 employees. In 1992, her first year in business, Peter-Lawshe took in $60,000; she estimates 1996 revenues will be $750,000.

Breakthrough Inc., an educational software company in Oakdale, Iowa, has also benefited from tapping into the remedial market. "More and more children are coming to school unprepared [to read basic textbooks]," says Carolyn Brown, Ph.D., who founded Breakthrough with her husband, Jerry Zimmermann, Ph.D., in 1987.

To help elementary school students learn to read, Brown, 43, and Zimmermann, 50, developed "Fundations in Reading"-a curriculum complete with computer software and printed materials. Based on Brown's doctoral research on early literacy, the program is sold to public schools and is designed so each child can work at his or her own pace at a computer workstation and receive individual instruction.

In 1994, the year Breakthrough Inc. began piloting the program in about 20 schools, sales hit $1 million. As for this year, Zimmermann and Brown estimate "Fundations in Reading" will be in more than 100 schools nationwide, with sales of more than $2 million.

Starting Smart

Think you've got an idea for an educational company? Like many of these entrepreneurs, you may see an opportunity based on something in your kids' lives. But to make sure you do it right, don't act on your intuition until you can confirm a real need for the service you're considering.

With this type of business, it's also a good idea to start small and on a local level before branching out. Before Peter-Lawshe launched her Reading and Language Arts Centers, for instance, she tested the waters by offering seminars at local libraries for parents whose kids were having trouble learning or needed extra help with homework.

Remember, too, that traditional centers of learning are't the only market for entrepreneurs in this field. In addition to school districts, day-care centers and preschools may be a potential market. Or you can add education to an existing child-care business.

To see if there's a need for educational enrichment in your area, research what others in your community are doing. If educational centers offering enriched classes are booked, there's probably a need for more such centers.

Of course, one of the best sources for market research is parents in your area. Talk to them to see what services they'd be interested in for their kids.

Education is always a hot topic in the media, so take advantage of that interest: Once your business is up and running, start a grass-roots public relations campaign. That's what Gold-Dworkin did when getting Little Scientist off the ground, and before she knew it, "people were coming from all over the state," she recalls, "and all the classes were filling up!"


Leah Ingram is a writer in Ann Arbor, Michigan