Why Tutoring Companies Are Struggling Post-ESSER Funding

In late July, Varsity Tutors sent a message to its school partners: Varsity Tutors for Schools would be discontinued, effective August 7, 2026. Districts and charters that had already scheduled Tier 3 sessions for the 2026-27 school year were told to find another provider. About 18 months earlier, in early 2025, FEV Tutor, one of the largest high-dosage virtual tutoring companies in the country, had also shut down. Both had built their school businesses on the back of ESSER, the roughly $190 billion in federal pandemic relief that flowed to K-12 between 2020 and 2024.

The story we keep hearing is that virtual tutoring "didn't work." That is not what the closures show. Both providers had strong instructional models. What collapsed was the funding stack underneath them. For special programs coordinators writing intervention contracts for the 2026-27 school year, that distinction is the whole game.

What Actually Happened in the Tutoring Market Since ESSER Ended?

Between 2020 and the September 30, 2024 obligation deadline, districts nationwide dedicated an estimated $3.6 billion of ESSER III funds to tutoring, according to FutureEd's tracking of local relief spending. When that deadline passed, the spending line functionally disappeared. State legislatures were expected to step in. Most did not, or did so at a fraction of the prior scale.

The result was a wave of contractions. Brown University economist Matthew Kraft, who has studied the economics of high-impact tutoring, told EdWeek Market Brief that "the marketplace for these services is starting to contract" as federal dollars dry up and more permanent state and district funding has failed to fully step in to sustain the rapid expansion of the last several years.

The predictable pattern followed. Vendors that had scaled staffing, technology, and sales infrastructure against a temporary funding source could not right-size fast enough when the funding disappeared. FEV Tutor closed. Varsity Tutors for Schools closed. Others quietly narrowed their school footprint and repositioned toward direct-to-consumer.

Why Should Your Intervention Team Care About Another Company's Shutdown?

Because the operational fallout lands on your desk. When a vendor disappears mid-contract, your special education team has to reconstruct service delivery for students on IEPs whose minutes were being met by that vendor. Your Title III coordinator has to document why supplement-not-supplant compliance held even though the supplemental service ended. Your business office may or may not recover the unused portion of a prepaid contract. Your MTSS team loses whatever progress-monitoring data lived inside the vendor's platform.

When you signed your current tutoring contract, did anyone ask what happened to that vendor's revenue between 2019 and 2021?

For a charter LEA operating on a lean back office, a mid-year vendor disappearance is not a minor procurement inconvenience. It is a compliance event. And in the current market, it is a foreseeable one.

What the Research Actually Says About Post-ESSER Sustainability

Kraft's own analysis of tutoring at scale, published through Annenberg's EdResearch for Recovery project, warned as early as 2020 that any provider whose unit economics only worked at ESSER-era pricing would struggle to survive the transition back to normal-year funding levels. NWEA's July 2024 report, Recovery still elusive: 2023-24 student achievement highlights persistent achievement gaps and a long road ahead, reached a related conclusion from the student-outcomes side: growth in 2023-24 fell short of pre-pandemic trends in nearly all grades, and pandemic recovery remains elusive. In our reading, closing that gap only works if the providers delivering intensive tutoring are still standing when the crisis funding ends.

In our experience working with charter LEAs, only a small handful of states have allocated meaningful new formula funding to replace ESSER-funded tutoring. Most left the decision to districts, and most districts have made it a local budget choice against competing priorities.

The distinguishing question is not "did the vendor grow between 2020 and 2024?" That growth was universal. The question is: what did the vendor's revenue mix look like before ESSER existed, and what does it look like now that ESSER is gone? Providers whose 2019 business model was already funded through Title I, Title III, IDEA, and state formula funding are still standing. Providers whose 2019 business model was largely direct-to-consumer test prep, pivoted into schools during 2021 and 2022 on ESSER dollars, and never re-underwrote their unit economics for a Title-funded world, are the ones closing.

What's Working: Providers Built on Formula Funding

The interventions that are renewing 2026-27 contracts share a small set of design choices:

• Priced against Title I, Title III, IDEA, and state formula rails, the same funding sources that existed in 2019 and will exist in 2029. Not priced against a one-time supplemental source.
• Compliance documentation built into the delivery model. Supplement-not-supplant memos, evidence-tier alignment for ESSA, and MTSS documentation are outputs of the service, not extra work for the coordinator.
• Progress monitoring in the school's own MAP or state assessment system, not trapped inside a proprietary vendor platform that goes dark if the vendor does.
• A named-tutor staffing model with the same clinician assigned to a student across a full year, so the intervention is a relationship, not a scheduling algorithm.
• A pre-2021 operating history, meaning evidence the provider was already delivering to schools before the ESSER expansion.

That last item is the one most RFPs still fail to ask about.

What A+ Sees in the Field

A+ Tutoring is a California K-12 virtual intervention provider working primarily with charter LEAs. Our funding stack in 2026-27 looks nearly identical to our funding stack in 2019: Title I, Title III, IDEA, and state formula sources, layered against partner school intervention budgets. We are renewing 2026-27 partner contracts at flat pricing.

The outcomes our published partner case studies report are consistent with that continuity. At iLEAD Exploration, our Math Tier 3 cohort showed 75 percent of students (9 of 12) reaching MAP Growth benchmarks. Our ELA Tier 3 cohort at the same partner showed 87.5 percent (7 of 8). Combined Tier 3 across both subjects showed 80 percent (16 of 20), at 3 to 6 times national MAP Growth norms.

If your current tutoring vendor closed on Friday, would you be able to name the funding source that would replace it on Monday?

A+ holds the NSSA Tutoring Program Design Badge (2024-2026), awarded by the National Student Support Accelerator at Stanford University after an evidence-based review of our program design and alignment to Tutoring Quality Standards. The Badge speaks to how the program is built. The outcome figures speak for themselves.

What School Leaders Can Do Next

Regardless of who you contract with, five actions will protect your intervention layer through the next funding cycle:

1. Add a funding-source disclosure question to every intervention RFP. Ask each vendor to break down their 2019, 2022, and 2024 revenue by federal, state, and district source, and by public and private capital. A vendor that will not answer is telling you something.
2. Ask for the 3-year revenue mix, not just top-line growth. Rapid growth from 2020 to 2024 is not a strength if the underlying source is gone.
3. Require pre-2021 operating evidence. Contracts, references, or published outcomes from a school customer before the ESSER window.
4. Insist that progress monitoring live in your MAP, state assessment, or SIS, not exclusively in the vendor's proprietary platform.
5. If you sit on the federal programs side of the budget: pull your district's ESSA evidence-tier crosswalk for tutoring, and confirm each of your current vendors still maps to Tier 1 or Tier 2 evidence. Vendor closures often coincide with quiet downgrades in evidence documentation. The report to pull this month is your intervention vendor list crosswalked to ESSA evidence tier, filed against your consolidated federal programs application.

About A+ Tutoring

A+ Tutoring designs and delivers K-12 virtual intervention for charter LEAs and district partners, funded through the same Title I, Title III, IDEA, and state formula rails our partners were using in 2019. Our partner schools have reported 75 percent of Math Tier 3 students, 87.5 percent in ELA Tier 3, and 80 percent in the combined Tier 3 cohort meeting MAP Growth benchmarks at 3 to 6 times national norms. We are renewing 2026-27 partner contracts at flat pricing.

If your 2026-27 intervention plan needs a walk-through, whether you are replacing a vendor that closed or auditing the one you have, Danielle will sit with you and map it against your funding stack.

Walk Your 2026-27 Intervention Plan With Danielle →