At one point during this year’s SXSWedu—a slick Austin conference heavy on marketing for education technology—an audience member stood and asked a panel of Texas lawmakers the question most in the room were probably wondering: how do you get the state of Texas to buy your software?
State Rep. Dan Branch suggested an egalitarian process at work behind the scenes: build a good product and put in your time convincing lawmakers. “If you walk the halls and talk to key members of committees, I think you can get your message out pretty well,” Branch said. For example, he said, one particular outfit called Reasoning Mind has built a reputation at the Capitol as “a very strong math software program.”
The creators of the Reasoning Mind software have certainly found success in Texas, but Dan Branch might be surprised to learn how they attained it.
The state contracts with all sorts of companies for educational software; most decisions are made by the Texas Education Agency. Reasoning Mind, a math program, is the only software program lawmakers wrote into the budget by name last session.
In its most recent funding request, TEA suggested cutting Reasoning Mind—they’d already contracted with another online math program—but lawmakers weren’t keen on ditching it. They gave the program its own budget rider and kept its funding steady, at $2.25 million in public funds a year.
It’s even more impressive that Reasoning Mind did so well at the Capitol without the services of a registered lobbyist. But Reasoning Mind has something even better going for it: close friends in the highest ranks of big oil.
Reasoning Mind’s board is chaired by Ernest H. Cockrell, the longtime head of the Cockrell Oil Corp. Its vice chair is Forrest Hoglund, a former Enron CEO and a force in the Dallas philanthropy world. As of 2011, the program’s biggest backer was the ExxonMobil Foundation, which, according to EducationWeek, had donated $5 million to Reasoning Mind. In April, the world’s largest corporation leaned on its support for Reasoning Mind to rebut an ad by an anti-oil group suggesting that “Exxon hates your children.”
Russian couple Alex and Julia Khachatryan founded Reasoning Mind in 2000 as a computer-based math education program for their son, whose school lessons they deemed too basic. Geared toward students in grades 2 through 6, Reasoning Mind promises to build math skills and to encourage critical thinking and independent learning, all with a game-like interface for kids.
Those friends in the oil industry are no accident. Before starting Reasoning Mind, the Khachatryans ran a firm called RPC overseas—short for Russian Petroleum Consultants—based in Moscow and Houston, with clients including Halliburton, Koch Industries and Cockrell Oil. According to its tax filings, Reasoning Mind spent $1.6 million on “computer programming and testing of end product” in Moscow, and paid another $20,000 direct to RPC Overseas for office space. As president and CEO, Alex Khachatryan made $62,292 in 2011, down from $115,000 the year before.
The program is growing. Schools in a few states use Reasoning Mind today, but its strongest foothold is in Texas, where Houston ISD and Dallas ISD both use the program. In all, the company says, 60,000 Texans use the program either as a supplemental curriculum or a full-time course. Nearly 11,000 copies were paid for by TEA.
The company has proved resilient when its funding is threatened. In summer of 2011, during the special legislative session on the state budget, the House overwhelmingly approved an amendment to zero out funding for Reasoning Mind. But when the budget bill returned from conference committee with the Senate, the math program’s rider was back in. House members couldn’t change the bill at that point, so Reasoning Mind’s funding continued. Because the conference committee discussions are closed to the public, it’s hard to say who in the Senate championed the program. Reasoning Mind’s two biggest boosters, Cockrell and Hoglund, have each given $66,000 to Lt. Gov. David Dewhurst’s campaigns since 2004.
In November 2012, the Dallas Morning News reported an internal study from Dallas ISD saying the program cost too much and did too little—but the district with more Reasoning Mind students than any other in the state stood by the program and pulled the study from its site.
Reasoning Mind countered with studies of its own. To help out, Reasoning Mind’s blue-blooded backers got involved. The News recounted an interview with Hoglund, who “said prominent charitable givers might pull their support for DISD if it isn’t continued.”
Too many important people, in other words, had too much invested in the program to let the district pull the plug—performance be damned.
Like so much else in Texas, in the education tech business, it helps to know a few oil execs.