School Choice Has a Supply Problem. We Invested in KaiPod to Fix It.

Over the last few years, states across the U.S. have started giving families money to pay for education outside the traditional public school system. Think of it like a scholarship for private school, microschool, tutoring, or homeschool curriculum. More than 30 states now run these programs, and a new federal tax-credit scholarship launching in 2027 could add up to $26 billion a year by 2030. That puts more education funding in families' hands than at any time in modern American history.

The expansion of funds comes on the heels of growing interest in alternative schooling models. According to a 2026 national survey, 75% of U.S. parents considered, searched for, or enrolled their child in a new school last year. The year before, it found that interest in microschools had tripled since 2022.

There's a problem, though: Families are seeking alternatives to traditional schools faster than new ones are being built.

Among parents who looked and didn't make a school change, one in four said the barrier was limited availability or waitlists. In Texas, over 100,000 families applied in the first window of its Education Savings Account program. In Alabama, more than twice as many families applied as there were spots available.

In short, microschool supply is not keeping up with funding and demand. That gap is the problem KaiPod is built to solve, and it's why we invested.

Why New Schools Are Hard to Build

The alternative schooling options that families seek often share similar qualities: smaller classes, more personalized instructional approaches, and environments where students build close, nurturing relationships with their teachers.

Microschools, which typically serve somewhere between five to 30 students, are faster and less costly to open than a conventional school. And as KaiPod's network has shown, the founders who want to start them are often experienced educators with a clear vision of what their communities need. Even though they've left the classroom, they still want to work to advance education.

For many of them, the hardest part of starting a school is not the vision or the teaching, but the everyday business operations that have been ill-served by existing tools. Compliance paperwork. Enrollment systems held together with spreadsheets. Billing software designed for daycares that doesn't quite fit. Marketing to families with almost no budget. Most great teachers who could run a great school never get past the operational friction of starting one.

The Shopify Moment for Schools

Before Shopify, starting an online business meant solving a lot of problems that had nothing to do with the actual business: payments, inventory, storefront, logistics. Shopify handled all of it so that entrepreneurs could focus on what they were building.

KaiPod is doing that for school founders. Catalyst, its accelerator program, takes aspiring founders from idea to open doors, with training, peer community, and coaching support through the hardest part of the launch. Newton, the operating platform, gives schools a purpose-built system for enrollment, billing, family communication, and academic management. KaiPod's microschool marketplace connects families to sites near them.

KaiPod doesn't dictate to founders what to teach or how to run their schools. It serves as a training program and modern software infrastructure, not a franchise. A rural educator who wants to run a Socratic seminar-based school gets the same tools as someone opening a project-based STEM school in a suburb.

More than 100 schools have launched through the Catalyst program, 50 in the past year alone. Schools that adopt Newton show strong retention, as the purpose-built software platform handles the complexity of running a small school in a way that nothing else on the market does. And as the platform grows, it captures real data about what's working, who's learning, and all the outcomes that matter to families and funders. In a sector that currently operates largely outside traditional accountability systems but will soon need to demonstrate results, KaiPod is ahead of the curve.

The Accelerant to Scale

When we invested, part of the thesis was always that KaiPod would grow beyond a grassroots network of educators-turned-school founders. The bigger impact opportunity is upstream: state governments that need to solve a school supply problem at scale, as districts watch families leave and need to respond.

That's where the business is heading. States are actively looking for partners to help them build new schools in communities that don't have them. KaiPod's combination of launch expertise, operating infrastructure, and on-the-ground support makes it a fundamentally different kind of partner than a software vendor or a consulting firm. It can actually create schools, not just advise on strategy. The company has already established partnerships with states like South Carolina to launch at least 20 schools targeting the most underserved counties.

Districts are coming into focus the same way. As families gain more options, those that will retain students are the ones that create compelling alternatives inside their own walls. The diversity of school models that KaiPod can catalyze within a district offers a more exciting, compelling vision for the future of public education.

The Opportunity Ahead

At Reach, we've spent the last decade watching structural shifts in education happen slowly, then all at once. The choice movement is at that inflection point. Funding is in place. Family demand is real. What comes next is a race to build the learning environments that make this moment matter.

This is why KaiPod is so important. It's not just software or a training program - it's the connective tissue between an educator with a vision and a family that's been waiting for something different. The community KaiPod has built, the network of schools it's launched, and the platform it's developed together create something that's genuinely hard to replicate: a flywheel where every new school makes the next one easier to launch, and every family placed strengthens the case for the next state partnership.

The next wave of American education will be built by educators who need someone to believe in them and give them the tools to start. We're glad to be backing KaiPod founder Amar Kumar and his team making this possible.