Also how are schools allowed to invest like this at all?
1) St. Francis is an expensive ($17k a year, which is actually pretty low for the area) private school, not a public school that receives funding from the government.
2) Most private schools have endowments and investment vehicles to manage those endowments. Tuition money generally isn't going into these funds, rather they're for donations and capital campaigns.
3) Many of the parents of the kids at St. Francis are tech executives or VCs, so it's not surprising that they're investing in startups instead of more traditional mutual or index funds.
> It turns out that Eggers actually persuaded his partners to cough up only $485,000 of the $500,000 investment. On his invitation, Natalie and Andrew’s school, St. Francis High School in Mountain View, Calif., chipped in the remaining $15,000.
I read on another article that he's on the board of the school's investment fund which backs startups. So it's a strategic initiative and definitely not sketchy as it's a private school.
This almost certainly means convincing his partners to let someone else come in instead if LVP taking the whole $500k. Lightspeed has over $3B in assets under management and $500k is already at the low end of check sizes they'd generally write. On the other hand, squeezing a friend into an interesting deal is a big favor.
/s?
Companies are allowed to invest their private money however they want. Why does it make a difference if it's a school?
In the Los Altos Mountain View area, I can name St. Nicholas, St. Simon, and St. Francis which are all private schools, none of which are named after the city that they are in.
There are definitely both public and private schools in California with the names of Catholic saints in both English and Spanish on each side, so that's not a certain tip off.
Nothing has guaranteed ROI...