An Interview with Nick Donohue: Nellie Mae Education Foundation CEO

Mar 5, 2012 by

Michael F. Shaughnessy –

1) Nick, first of all, let me give you an opportunity to distance yourself from Freddie Mac and Sallie Mae and Nellie Mae Student loans.

The Foundation was created 14 years ago and it is a philanthropy – specifically a public charity. We are a non-profit. Our focus is the improvement of education. The other entities are for profit businesses. Their focus is the business of actively purchasing and guaranteeing loans of various kinds. We do not make money per se; we give away money in the form of grants.

The Foundation and its precursors have been strategically investing in the future of education in New England since 1990. In that year, the Nellie Mae Corporation (NMC), a nonprofit education-financing company, created the Fund for Education, pioneering philanthropy within the student loan industry. Over the next eight years, the Fund for Education provided $5 million in grants and support to advance more than 300 education programs throughout the region. In 1998, the Nellie Mae Foundation was formed.


The following year’s purchase of the Nellie Mae Corporation by Sallie Mae (SLM Holding Corporation) created the endowment for what is currently the Nellie Mae Education Foundation. At that time the Foundation was spun off from the Nellie Mae Corporation as a separate entity and is not affiliated with NMC or Sallie Mae.


As a result, the Nellie Mae Education Foundation does not purchase or guarantee student loans.  We have a small dwindling portfolio of student loans as part of its assets that were retained when the Foundation was created more than a decade ago.  These loans are mature and their value over the next few years will decrease significantly with the remaining smaller immaterial balances to be paid off within the next 10 years.

2) Why do you continue to use the term Nellie Mae, and what does it stand for?

Nellie Mae originally stood for New England Education Loan Marketing.

Since 1998, the Nellie Mae Education Foundation has built a positive reputation and a history for our commitment to supporting and promoting quality education in New England. We have considered changing our name at various times in the Foundations history. We revisited this recently given the challenging economic developments and how these events raised the profile of organizations with similar sounding names. However, we have determined that for the time being the Nellie Maebrand value and familiarity of our name outweigh the issues that come with occasionally and mistakenly being connected with active loan companies.

3) Now some details- where are you located, and what exactly is your mission or mission statement?

The Nellie Mae Education Foundation (NMEF) is located in Quincy, Massachusetts about 20 min. south of Boston and our focus is primarily the six New England states – CT, RI, MA, VT, ME and NH.

Our mission is to stimulate transformative change of public education systems across New England by increasing the availability of high quality educational opportunities that enable all learners – especially and essentially underserved learners – to obtain the skills and knowledge necessary to become civically engaged and economically self-sufficient.

Our vision is that all New England learners are graduated from high school prepared for success in post-secondary education. Investing now in the development of all learners will enable them to emerge from our education systems as engaged citizens and productive members of our communities.

While we are not the only organization investing in education in New England we are the largest public charity dedicated solely to education. And Nellie Mae is currently the only organization in New England investing in reshaping education through systems-change.

4) Who oversees your operation and is there an ombudsman should a grantee have a concern?

Pursuant to its Articles of Organization, the Foundation operates exclusively for the benefit of, and to promote the charitable and educational purposes of, educational organizations. We are currently managed by a 15 person Board of Directorsmany of whom represent the class of organizations we are permitted to fund. So, in effect our Board is charged with making sure we do our work well and in the name of the class of organizations we serve.

Our grantees are provided with a dedicated Senior Program Officer who oversees their grant making process and addresses any of their concerns. The foundation maintains standard grant making processes that include regular reporting required from our grantees. As a non-profit we also comply with regulations established by Massachusetts state law that are regulated by the state’s Attorney General.

5) How are you funded, and how many people are there in your organization?

As stated in question 2 the Foundation was endowed by the sale of the Nellie Mae Corporation to Sallie Mae Holding Corp. This means we do not routinely solicit contributions or receive any public monies. Our corpus is managed by a team of financial experts.There are currently 18 full-time staff.

6) Give me an example of how NMEF is working to reshape public education for underserved learners

The work at the Foundation is rooted in the notion that in order for New England to prosper in the future, we must equip all students with the skills and knowledge necessary for success in work and life. We believe every community, like a well-tuned orchestra, must work together to provide high quality educational experiences for all students. Toward this end, we’re focusing on the promotion and integration of student-centered approaches to learning at the middle- and high-school levels and the support of systems of education that promote these kinds of practices.

The changes we promote are significant reshaping of systems of education and a fundamental revision of how education is delivered versus the incremental improvement of the systems we know today. As with remodeling a house, the time has passed when a new coat of paint, some new appliances or even a new addition is sufficient to renovate education adequately, we need to get down to the weight bearing walls and reconsider some very fundamental aspects of the policies that define public education, the culture of organizations that support public education and how learning is delivered.

For some time, as a society we have made do with a system that has provided a very similar experience to all learners and we have managed with having a minority of those students succeed through traditional approaches. Nowadays, in order to progress as a society in a global context, we must have many more learners succeed at much higher levels. Furthermore, our most under served learners – those who are poor and of color – must do much better for practical and moral reasons. Practically we need them to succeed so our society can prosper more fully and morally it is unfair that some communities provide better educational opportunities than others.

However, our mission is not just a matter of equity of resources and opportunity; it is also about the transformation and excellence of the kind of education that is provided. Too often, where, when, and how students are taught are held rigidly constant; learning is the variable, with many students falling behind or failing to acquire the capabilities and knowledge necessary to thrive.

Student-centered approaches turn this equation around and move away from our current “one-size-fits-all” batch processing of students. By building around the fact that different students learn in different ways, student-centered means: being flexible about how time is used for both students and educators, including learning opportunities outside the traditional school calendar; harnessing the broader community to support and deepen learning experiences; taking advantage of the fast accelerating and best advances in technology supported education; using curriculum, instruction and assessment that promotes the skills and knowledge needed for success in college, work and life; and basing advancement on demonstration of proficiency in and mastery of skills and knowledge. In these ways, schools can adapt to the wide variety of leaners they serve rather than the other way around.

If we look closely at the gains made through even our best existing efforts, it is unclear that they project an increase in outcomes that will meet our needs as a society or that the most effective of these strategies will reach scale. That is why we are focused on change at the systems level rather than only promoting practices that make the best of our current system.

The foundation makes a wide variety of grants across New England at the state and local levels. We just recently awarded a total of $16.4 million in grants over three years to support four districts in New England to support the continuation of ongoing work to remodel their education systems to be more student centered. Awards were made to: Burlington & Winooski, VT; Pittsfield, NH; Portland, ME; and Sanford, ME. Four additional Lead Community Partner grants were also made to organizations in each community – Vermont’s Children (Burlington & Winooski, VT); The Pittsfield Youth Workshop (Pittsfield, NH); The Refugee Services Program (Portland, ME); and Safe and Healthy Sanford Coalition (Sanford ME).

Through the work of our grantees – each in their own way – learning will become the constant and where, when, and how it happens, as well as the adults who guide it, becomes the variable. Each of these grantees has also demonstrated a commitment to equitable opportunities and strong results for all learners.

This work includes efforts to infuse technology meaningfully, move toward proficiency based way of promoting learners, support expanded learning opportunities outside of school for credit (including but not limited to virtual learning), promote standards-based and project based approaches that focus on a wide range of higher order skills and knowledge consistent with and expanding on the Common Core.

While weare excited to make these local grants focus on model development, policy change and building public will, we know that the related challenges of this work need to also include–continuing to influence enabling state and federal policies, growing public understanding and demand more broadly for these kinds of educational approaches, and, of course building a strong knowledge base to inform this work.

To actualize this multi-faceted strategy and to complement the grants we make to help develop effective, local models of student centered approaches; we also make grants to promote policy changes at the state and federal levels so these “rules of engagement”are aligned with, support and do not impede creative, research-based efforts to make education work better for more learners.

The kinds of policy change we support include work on state graduation requirements, carnegie unit requirements, other regulations about time, human capital policies defining who can serve as educators, policies regarding school finance as well as and policies concerning accountability. We make grants that focus on these issues to state based coalitions, state departments of education and other organizations such as the Maine Coalition for Excellence in Education, Vermont Voices for Children, The Rhode Island After school Alliance, The Connecticut Coalition for Educational Excellence, the Connecticut Superintendents Association and the Rennie Center here in Massachusetts among others.

We also support the ECS Award winning New England Secondary Schools Consortium a five state collaborative made up of senior state level educators, policy makers and other key opinion leaders. Our portfolio also includes small set of grants and other work focused on helping to shape policy at the federal level – particularly at this time the reauthorization of ESEA aka NCLB.

Furthermore, we are quickly moving toward supporting a more public posture and hope to build public understanding and demand by elevating the issue of where, when and with whom learning happens to a public discourse to support the local work and policy initiatives. This work will be informed by research about public understanding commissioned through grants made to The Frameworks Institute. And, finally, while to date we have rarely advocated directly for legislative changes, as a public charity we are permitted to do with some restrictions.

7) Why is funding change in public education important and what role do you see the Foundation playing now and in the future?

Our world is becoming increasingly more complex and changing rapidly. Supporting the progress of districts and their communities to implement long term plans to reshape their education systems so all students can succeed at higher levels and addressing the broader policy contexts in which these systems work is important for our region to prosper in the future.

Our role is to support these communities and other educational and community leaders as they continue their ongoing work to improve their systems. In addition we will continue to focus on supporting organizations that seek to promote state and federal education policies that support student-centered learning at scale; building a base of knowledge which informs the work of NMEF as well as that of practitioners in the fields of education and philanthropy; and work to increase both awareness of the work of our grantees and student-centered learning approaches.

And while we may occasionally take public positions on certain issues and want to increase the public dialogue about student centered approaches, the core of our work is supporting the work of others, in leadership and initiative.

Finally, our role is to find and build effective partnerships with others. There is a growing community of funders, practitioners and policy makers focusing on how to promote student centered approaches and systems of learning. We are proud of our good and growing working relationships with a number of the nation’s leading philanthropies and organizations dedicated to change and improvement.

8) Could you briefly summarize the processes and procedures or send us to your web site?

You can view grant making processes by visiting our Grant FAQ page at: . Please note that in a few weeks’ time we will be updating our website and that link may change.

Is there anything else you would like to add?

This is exciting challenging work because it charts a new course for education. As our missions states, we are focused on “all learners, especially and essentially those underserved.” The effort of promoting change and innovation in education and educational systems is demanding. Doing so, and remaining vigilant that the needs of our most struggling populations are met as we promote creative and new ways of learning is an additional, and we believe, essential challenge.

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