Last week I came across a remarkable teacher at one of my trainings.
She teaches 5 year olds how to run a business. Her methodology is simple:
After placing a small piggy bank in the middle of the room, she asks students to fill it with loose change. The kids go home, find any change they have laying around and bring it back the next day. That’s when the challenge begins.
She tells them that this year they must find a way to turn that change into a highly profitable business that benefits the community. Her one stipulation- whatever you take out of the piggy bank, you must do your best to put back in.
It works. Every year.
Some kids use change to purchase fruit for their smoothie and lemonade stands and increase the money 5 fold. Others use it to purchase beads for their accessory business to market to children in other classes.
To increase community involvement and collective ownership, students are required to ‘pitch’ their ideas to classmates.
Why a Class Businesses Help Prepare Students for the Future
This brilliant kindergarten teacher was on to something. She knew that in today’s uncertain economy, teaching students how to run a class business was as important as teaching them their ABC’s. Here’s why:
#1: Teaches Delayed Gratification
By turning the piggy bank into a class business, students learned to delay immediate gratification for long term success. They saw first hand how money was able to grow. These same principles can be applied later in life when making investments, purchasing a home, or planning for retirement.
#2: Creates Community Ownership
No one individual owned the piggy bank. It was owned collectively by the class. This taught students to view decision making as a collective process with several key stakeholders. Many businesses operate according to the same premise. In order to grow, they have to involve numerous shareholders, from public to private entities. And similar to the class piggy bank, decision making moved away from a narrow focus of profitability to what would work best for the collective good.
#3: Teaches students adaptability
It’s predicted that within five years, close to 50% of the world’s population will be freelancing in some form. What’s even more alarming: millennials tend to hold 3-5 jobs before the age of 30- and that has nothing to do with diminished work ethic; it’s because the world is changing at an alarming rate. So what’s that got to do with a class business? Teaching kids as young as 5 to adapt to uncertainty is the best way to prepare them for it. When running the class business, inevitably some student ideas will fail, forcing them to pivot and pursue new ideas and ventures. This ability to pivot will allow them to adapt to new fields when their current jobs become obsolete.
#4: Numbers make more sense when applied to the real world
I remember hating math as a kid. It was all too abstract. Even word problems were written abstractly, with test writers asking us to use calculus to lean a ladder against the wall. A class business on the other hand helps students get to abstract math concepts in a practical way. Students learn concepts of dividends, diminishing returns, interest (complex and compound), supply and demand, and others necessary to sustain and grow their business.
#5: Exposes students to problem solving and creativity
According to the world economic forum, in the year 2025 problem solving and creativity will be the first and third most important skills respectively. That’s a seven step move for creativity (it was #10 in 2015).
What better way to teach these skills than having students apply them on a daily basis?
As is the case with any business, problems will arise that are natural to sustaining and growing it. Students will be forced to find an appropriate market; create interest around their products; conduct pre- and post analysis when selling their goods; and determine ways to ensure customer satisfaction. Dealing with these problems on a daily basis will create resilience and confidence in students to solve bigger problems later in life.
How to Start Your Class Business
Interested in starting your own class business? You don’t have to go at it alone. There’s a wonderful organization called ‘Real World Scholars’ that helps teachers start their own class enterprises. They provide a starter kit, access to funding, and an online marketplace to sell goods. Check them out at ‘Real World Scholars.’
Have an incredible week leading our future tinkerers, explorers, and entrepreneurs.
Your Innovations Coach and #1 Cheerleader,