Financial Emergencies Can Be Catastrophic for Low-Income Students. A Start-Up Wants to Help.

Financial Emergencies Can Be Catastrophic for Low-Income Students. A Start-Up Wants to Help.

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It says a lot about the state of American higher education — and perhaps the ed-tech scene, too — when a start-up decides that its business will be to help needy students find emergency aid and to guide colleges in providing that ***istance in a fairer and more efficient way.

You’re reading the latest issue of The Edge, a weekly newsletter by Goldie Blumenstyk. Sign up here to get her insights on the people, trends, and ideas that are reshaping higher education.

I’m Goldie Blumenstyk, a senior writer at The Chronicle of Higher Education, covering innovation in and around academe. Here’s what I’m thinking about this week.

Students need money for financial emergencies. A start-up wants to help.

It says a lot about the state of American higher education — and perhaps the ed-tech scene, too — when a start-up decides that its business will be to help needy students find emergency aid and to guide colleges in providing that ***istance in a fairer and more efficient way.

I’m still getting my head around exactly what it says.

Meanwhile, the story of how that company, Edquity, has been shifting course continues to interest me. Ditto its founder, David Helene, whom I first met just over a year ago, when he took part in our “Shark Tank: Edu Edition” at South by Southwest EDU and was pitching the Edquity app as a college-planning and money-management tool for students.

The app was always designed with low-income students in mind, but since then, Helene says, he’s become even more conscious that the problem many students face isn’t that they don’t know how to budget their finances. It’s “students not having money to manage,” as he puts it.

The Edquity story gets even more intriguing this week: On Tuesday the Brooklyn-based company is naming Sara Goldrick-Rab as its chief strategy officer for emergency aid, marking the first time the crusading sociology professor at Temple University has, in her words, “set foot in the for-profit sector.” She will help the fledgling company apply its tech-driven services to help colleges manage and apportion emergency aid to the students most in need.

The idea, Helene tells me, is to “replicate and digitize what a lot of colleges have done in a scrappy way” already. Institutions like Amarillo College, with its array of supports for needy students, have set the bar in this arena. Helene hopes Edquity will become the tool that colleges use to “scale what Amarillo calls their ‘culture of care.’”

(Edquity has also been making moves on other fronts. This month it acquired BridgeEdU, the Baltimore-based college-completion company founded by Wes Moore, whom you may know for his book The Other Wes Moore: One Name, Two Fates, or from my 2018 interview with him.)

Edquity continues to offer money-management tools to students. Another section of the app, designed for students at LaGuardia Community College and Nevada State College, provides information on available emergency aid from local as well as national groups, plus contact information for social-service agencies, complete with a Yelp-like feature that lets students give feedback that others can see.

Edquity’s newest college-facing system is built around an algorithm that Goldrick-Rab developed, based on research on students facing food insecurity and homelessness, that she and others conduct at the Hope Center for College, Community, and Justice.

Until now, Edquity has had limited reach, with just a few hundred students using its app. Its first test comes this fall, when the 86,000-student Dallas County Community College system will use the company to help it manage its emergency-aid programs. The company expects about 18,000 students to use the app to seek ***istance. Researchers from the Hope Center will evaluate the effort. Goldrick-Rab says the study will be at “arm’s length” from her, overseen by the center’s research director.

Edquity is also looking to expand the notion of what emergency aid from a college looks like. It’s forging partnerships with hotel chains, car-repair companies, grocery stores, and the like, so that students facing eviction, car trouble, or hunger can get direct ***istance or discounts from such providers when the college learns that they need it.

I find that idea particularly clever. “Sometimes cash is the right solution,” as Helene told me. But such partnerships are a creative way for colleges with limited resources to extend their services while tapping into corporations’ philanthropic inclinations. And having an entity like Edquity do this at a national level could save a lot of colleges a lot of energy better used elsewhere.

More broadly, I understand how an app like this could be helpful, especially because, as Goldrick-Rab notes, sometimes figuring out who deserves what takes more time and money that the aid itself is worth. “In this case, tech actually helps us,” she says. And I see the value in putting some automation in the process, especially if it can avert some of the shame that students might feel when applying for aid face-to-face.

Still, I expect Edquity could (and should) face questions about the ***umptions and weighting of student needs driving its proprietary algorithm — despite Goldrick-Rab’s ***urances that “there’s nothing about it that can do any harm.”

Beyond that, I find Edquity’s direction both troubling and comforting: troubling because so many students have these emergency needs that a company sees a market, but comforting because so few other ed-tech companies even focus on issues affecting the neediest students. At least here’s one that does.

Got a tip you’d like to share, or a question you’d like me to answer? Let me know, at goldie@chronicle.com. If you have been forwarded this newsletter and would like to see past issues, or sign up to receive your own copy, you can do so here.


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