Innovations in the world of education mean growth opportunity for investors. While working in the traditional textbook industry, Rita Ferrandino saw opportunity for new resources and co-founded ARC Capital Development in 2003. Since then, the company has been involved with companies from Blackboard to Rosetta Stone. We spoke with Ferrandino about the future of education.

How do you find companies worthy of investment?  

When you are a private investment and advisory group, companies often find you. In addition, we are actively participating in innovation accelerator programs; the most prominent is LearnLaunch Institute in Boston, the premiere accelerator for education technology companies in the country. We are mentors and active participants. We often work with investors, entrepreneurs, college professors or teachers who invent a product. These early-stage companies know people will pay them money and their product works; they need a way to bridge their organizations into sustainable businesses.

What’s the biggest change coming in the education business? 

This generation of new teachers entering the teaching field are digital natives, and all the students that are attending school are digital natives. That shift has happened. The mobile phone has helped that change. We used to worry about one-to-one computing. Now most high schoolers have a phone, and most middle schoolers. We worked on elementary science curriculum product using a science app, kids will go to a museum or to a park with a smartphone, and they can see a leaf and upload a leaf and be able to create a digital portfolio of what they see. The kinds of things you can do with a smartphone with education purpose is amazing.