School choice is on the rise across the U.S. New Hampshire just became the 16th state to pass universal school choice in the past four years, and tax credits in the Big Beautiful Bill are likely to help it spread even more.
In Texas, home of the country’s largest school choice program – Education Savings Accounts (ESA) – families will receive $11,000 per K-12 student, and special needs students will receive up to $30,000. Some 90,000 families are expected to be served in the program’s first year.
It’s a $1 billion program, and with that big price tag, education reform advocates who’ve spent decades fighting for school choice fear that funding will attract corporate actors who aren’t interested in their movement, just the money.
One company in the spotlight is Odyssey, a venture capital-backed startup poised to bid for the Texas ESA contract. While Odyssey touts its experience managing ESA programs in other states, critics warn that its track record raises serious red flags.
In 2022, Odyssey was awarded the contract to administer Idaho’s education microgrant program – the company’s first statewide contract. However, the program quickly drew scrutiny. Reports surfaced of taxpayer-funded purchases for non-educational items, including TV sets, smartwatches, and clothing. It also took Odyssey four months to provide vendors with a clear list of approved and banned items, leading to widespread confusion and misuse of funds.
Further controversy erupted when Idaho officials discovered that Odyssey had collected nearly $479,000 in interest on federal funds that bankrolled the state program. The state ordered the company to return the money. In October 2024, Idaho terminated its contract with Odyssey and selected a new vendor.
Despite those issues, Odyssey used its Idaho experience as a “success story” in its application to run Iowa’s ESA program. The company ultimately won the Iowa contract, but later increased its fees, prompting the state auditor to report that Odyssey was charging nearly double its initial proposal. Allegations followed, accusing Odyssey of undervaluing its bids in order to win contracts, with plans to recoup losses by scaling operations across multiple states.
“Odyssey’s business model has been to undervalue services, win contracts based on low prices, and eventually make up for those losses by expanding to more states,” a source told the Washington Examiner, speaking on condition of anonymity.
Lauren Bender, head of Strategy and Growth at Odyssey, declined to answer numerous questions from InsideSources, stating instead that the company “categorically rejects any implication that our state operations were conducted with impropriety.”
“Every dollar flowing through our platform is carefully tracked, the platform is regularly audited, and every payment collected by Odyssey has been explicitly outlined in our contracts or was made at the direct request of the state agency in question,” Bender said
Advocates are urging caution. “This controversy is a great reminder that states must be vigilant when implementing school choice policies,” Nicole Neily, president of Parents Defending Education, told the Examiner.
“Parents have fought too hard for the right to determine their child’s education. We cannot afford for administrations to waste hard-fought victories.”
As school choice continues to expand, lawmakers, parents, and education officials face a critical challenge: ensuring that these programs are not only available but also accountable.
