social impact bonds

  • The Invisible Heart

The Investor: J.B. Pritzker

Updated: Apr 26, 2018



Heir to the Hyatt fortune, J.B. Pritzker is an early supporter of Social Impact Bonds (SIBs) in the United States. In 2012 and 2014, The Pritzker Family Foundation invested in the world’s first preschool SIBs in Utah and Chicago.


A member of seventh richest family in the US, Pritzker views SIBs as the answer to a lack of government funding for preschool.



J.B. Pritzker is a long-time supporter of early childhood programs for disadvantaged children. “I became fascinated by the idea that you could really change the trajectory of somebody's life at a very early age, in a very positive way,” says Pritzker.


The Pritzker Family Foundation along with Goldman Sachs and Northern Trust have invested $17 million to send 2,600 Chicago students to preschool. If the children test well, the investors will make a profit and potentially double their capital.


In this video, Pritzker defends the idea of monetizing preschool to attract private investment:



In 2018, Utah’s preschool SIB was expanded to cover the entire district of Granite, which is the first district in the nation to be financed by private investors who pay upfront for preschool seats, and make a profit if enough of the district’s “at-risk” kids succeed. In exchange, taxpayers avoid the cost of providing upfront money but end up paying more than the actual cost of the program.


In 2017 Chicago finished its final year of the SIB funded preschool program. Will Chicago follow in Utah’s footsteps and also scale up its SIB experiment?


In this 2015 interview for The Invisible Heart, J.B. Pritzker predicts government incentives to promote SIB investment:



Right now J.B. Pritzker is campaigning to be governor of Illinois in the most expensive election in U.S. history. It is estimated that Pritzker is spending more than $100,000 a day on his campaign. Pritzker is running on a platform of universal preschool and increased taxation. He has yet to explain how preschool will be funded if he becomes Governor – by for-profit investment or direct government funding.



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