Ten years ago, a Montessori enthusiast named Ray Girn had a vision. He wanted to bring high-quality, child-led education to as many babies and toddlers as possible, with a chain of for-profit schools that would grow at the pace of a tech start-up. He spoke about doing for preschools “what ride-sharing apps or Airbnb have achieved,” and he raised $335 million from investors, including venture capital and private equity firms, to make it happen.
For a while, Mr. Girn’s schools, which operated under the brand Guidepost Montessori, appeared to be successful, with 150 locations that served tens of thousands of children. But they also ran up an astonishing $440 million in losses. The parent company, Higher Ground Education, filed for bankruptcy in June 2025 and shuttered about 60 schools.
In Oregon, parents received an email notification on a Sunday afternoon that their school effectively no longer existed. In Wisconsin, a father went to drop off his 5-month-old son at a Guidepost only to find it had closed. In California, a mother learned that her children’s Guidepost had been sold and that its Montessori curriculum would be replaced with artificial intelligence. Guidepost teachers and parents lit up Facebook and Reddit groups with horror stories — allegations of neglect and mistreatment that made a lot more sense now that everyone knew how mismanaged the company had been.
For-profit education ventures are notorious for disappointing investors and leaving parents fuming. But even in this context, the Guidepost story is striking. “Schools close sometimes, but usually not this many, and not all at once,” said Rebecca Winthrop, who directs the Center for Universal Education at the Brookings Institution.
What could have caused such a collapse? More than two dozen former teachers, administrators and corporate employees told me that they were deeply concerned by the company’s business model. Seven independently described it as a pyramid scheme. “We were calling it the Montessori Ponzi scheme internally,” said Alex Richardson, a teacher at Guidepost’s first school, in Orange County, Calif.
When Higher Ground opened new Guidepost schools, it often received large advances from landlords to improve their properties. As long as the company kept expanding, it seemed from the outside as if it were thriving. But when it came time to repay the landlords, and growth was no longer an option, the company collapsed. By the end, some Guidepost locations were losing $50,000 a month.
Mr. Girn is still active in the education industry. Last year, he and his wife, Rebecca Girn — the other founder of Higher Ground and its general counsel — welcomed me at a converted ranch-style house outside Austin, Texas, where they’ve already opened another school, called Fulcrum. Their three children are among the students.
When we met, Mr. Girn, 47, had a warm presence, a slightly nasal voice and a compelling smile. Ms. Girn, 42, was smaller, quieter and clearly used to being interrupted by her husband. They adamantly disputed the Ponzi comparisons and told me they were proud of what they’d built. “You can’t care about the people that are critics,” Mr. Girn said. “We’re not apologizing for this.”
We spoke for several hours, a conversation in which Mr. Girn referenced Julius Caesar, Plato, the founding fathers, environmentalism, Bismarckian Germany and Taylor Swift. As we talked, it became clear that the rise and fall of Guidepost was an only-in-America story of a charismatic founder who’s more confident than capable, and of the deep-pocketed investors who enabled him. But instead of an app that failed or a tech platform that went sideways, to the detriment of some customers, this time the casualties were children.
Guidepost was not the first school chain that Mr. Girn had run at an unsustainable pace. Back in 2003, when Mr. Girn, a Canadian native, was a psychology and philosophy student at the University of Toronto, a friend suggested he come work at a school in Orange County called LePort Montessori. It was founded by a wealthy bariatric surgeon, Peter LePort, who sat on the board of the Ayn Rand Institute. Mr. Girn had no formal training in education, but he ran a Rand-focused club on campus. That was enough for Mr. LePort, who hired him to help start a new elementary school.
Mr. Girn became devoted to the Montessori method, which encourages children to direct their own lessons, with teachers as guides. “It’s as close to perfect as human education has ever gotten,” he once said at an Ayn Rand Institute conference. Traditional schools stifled children’s innate love of learning, he thought, and day care programs could be especially oppressive. “They’re literally putting the child behind bars, moving them from rocker to high chair to container,” he said. Montessori could free them.
In 2009, Mr. Girn became the chief executive of LePort. He envisioned turning the company into a national chain (“We had the opportunity to become the child care provider for SpaceX,” he said). But he was more focused on growth than Mr. LePort was comfortable with. In 2016, Mr. Girn was fired.
He resolved to try again, this time with a chain of schools that he could control. He and Ms. Girn formed Higher Ground and hired several of LePort’s corporate staff members. Some LePort parents soon followed, including Greg Mauro, a founding partner of Learn Capital, a venture firm known for backing education start-ups. Learn Capital invested about $1 million, and Mr. Girn opened his first two Guidepost schools. Within three years, the company had 27.
Guidepost employees describe these early schools as thoughtfully planned. White-walled classrooms were outfitted with charming, toddler-sized furniture made of pale, unfinished wood. “Everyone cared so deeply,” said Kiana Kometani, who in 2019 became the first head of school at a Guidepost in Folsom, Calif. Teachers spoke about fostering each child’s intellectual curiosity, of giving them agency before they could tie their shoes.
Mr. Girn was a skillful pitchman. He promised parents something rare: the rigorous education of a high-end preschool, but with the hours of a commercial day care. Most Guideposts were in wealthy places — Walnut Creek, Brooklyn Heights — and appealed to the kind of dual-income families who could afford the equivalent of a small sedan in preschool tuition.
“Guidepost catered to the elevated intellectual type,” said Emily Tkaczibson, who paid about $4,000 a month for her two children to attend a Guidepost in Tigard, Ore. “We would have recommended the school to anybody.” Matthew Espie, another parent in Tigard, considered himself “lucky” that his youngest child got off the waiting list after only 10 months.
There were signs, though, that the company was trying to do too much too soon. Mr. Girn expanded abroad, opening schools in Hong Kong and mainland China in 2019. Mr. Richardson, the Orange County teacher, said around that time, three Chinese toddlers came to his school for reasons that were never explained. None of them spoke English, and the Guidepost teachers didn’t speak Mandarin.
“One toddler would stand there and cry and say the same word over and over again,” Mr. Richardson said. “We learned later that she was yelling for her mom, but at the time we didn’t know. We couldn’t understand her enough to help her.”
Running a preschool is expensive. Buildings need to be rented and renovated; classroom materials purchased; teachers and administrators hired. Until a Guidepost location enrolled enough tuition-paying students, the parent company, Higher Ground, had to prop it up financially.
Labor was typically the highest expense. Laws vary by state, but businesses that deal with babies and toddlers are usually required to maintain certain ratios: one caregiver for every three to five children under age 2, and every eight to 10 preschoolers. And teachers with specialized Montessori training can command salaries that are tens of thousands of dollars higher than their peers’, and nearly double that of a day care worker.
There are two generally recognized Montessori training organizations, as well as other groups that help to uphold standards. But the label is not trademarked, and ultimately, any school that wants to call itself a Montessori can do so. Higher Ground created its own program, the Prepared Montessorian Institute. It allowed the company to hire conventional teachers and train them on the job, with primarily online lessons that could be taken, for free, during downtime.
The training program was accredited, but early Guidepost employees said that teachers struggled to get away from the classroom long enough to complete the lessons. “A bunch of us were enrolled in P.M.I.,” said Rhiannon Lentz, a former Guidepost teacher in Kansas, “but I don’t know anyone who finished it.”
In a 2024 podcast interview, Mr. Girn described this approach to hiring as a way to find “soul mates” — people who were good with children but lacked formal credentials. “I can walk into Chick-fil-A with my kids and really like the person and ask the cashier, ‘Do you like kids? You should consider becoming a Montessori teacher,’” Mr. Girn said.
The upshot was that some parents were choosing Guidepost for its Montessori marketing, unaware that their children were being taught by novices. Mr. Richardson, from Orange County, says he was hired as an assistant teacher in 2019 for $19.50 an hour with no experience caring for small children. “On my first day they said, ‘Hi Alex, welcome to Guidepost, please go into the classroom.’ They put me in during nap time for kids aged 2½ through 5. I had no clue what to do.”
Even with these labor savings, it still took time for new schools to turn a profit. To help them out, when Higher Ground signed leases, it often asked landlords to front the company hundreds of thousands of dollars or more. Ms. Girn told me that this funded “not just the construction, but also the financial ramp-up, because the school loses money for two years.” Mr. Girn added: “We are literally not putting in a penny. We are just going to be paying higher rent in year three.”
But that plan works only if a school is smoothly progressing toward full enrollment. When the pandemic arrived in 2020, it nearly toppled the U.S. child care industry, and Guidepost was no exception. By the end of that year, many schools were only partly filled, and the company was $55 million in the red.
Mr. Girn faced a choice. He could shrink his company, closing weak locations to focus on the best-performing schools, until the virus abated. Or he could open more schools and use the money fronted by landlords to keep operating. He opted to expand. “They were opening a school, then rushing to open more schools, get new capital,” said Diana Le Sieur, who worked for Higher Ground for five years in various capacities.
Ms. Kometani, who ran the Folsom Guidepost, said that Mr. Girn once explained the strategy in a regional staff meeting. “I remember him talking about how much money they got when they opened a new school,” she said. “It was in the millions.”
Employees started making Ponzi jokes. When I told Mr. Girn in Texas that several of his former employees claimed he’d effectively been running a pyramid scheme, he dismissed it as hyperbole. “The only ones that could be justified saying that would be some of the landlords,” he said. He acknowledged, though, that the approach was financially irresponsible. “We accelerated some openings to get some cash sooner,” Mr. Girn said. “This is part of the mistake.”
I pressed him on a critical point: When landlords fronted the company money for a new location, were the funds ever used for other costs? “The new money was for the new school, but a portion of that was for overhead, and we didn’t have — we could cover more of our general overhead with that money,” Mr. Girn said. But he also said, “We did not take landlord money and give it to an existing school in the way that’s being described.”
Kevin McDonald, a landlord in Missouri, said he doubted that the money he’d advanced for a new Guidepost was used entirely at that location. “In my opinion, they’re not ethical people,” he told me. “They borrowed from us to help them open up other schools. In our case in Ellisville, they asked for $1 million in tenant improvements. Not even a third of that went to that school.” He clarified that this was an estimate. “You can just figure it out,” he said. “They didn’t use the money. When I went to the school a couple of times, I saw it.”
Mr. Girn wrote in a text message this month that he’d created “an incredible business model that is unfortunately very misunderstood,” adding: “Yes, the ‘float’ did impact the timing of our capital cycle, and there are legitimate criticisms one can make of our strategy, but it’s just plain false that we did anything negligent or nefarious.”
According to bankruptcy filings, the company opened 33 schools in 2020 and another 21 the next year, while cumulative losses grew to $154.6 million.
Mr. Girn remained convinced that the pandemic presented an opportunity. So many preschools and day cares closed during Covid that there were now vastly more families in need of child care than there were places to serve them. Guidepost could fill the void.
With that pitch, the company raised about $100 million from investors, much of it from either Learn Capital or Venn Growth Partners, a private equity firm that took a 7 percent stake and a board seat. In early 2022, Blackstone valued Higher Ground at $1 billion. By 2023 the company had opened another 50 Guidepost schools, getting another influx of cash from landlords.
But Mr. Girn had not accounted for the post-pandemic labor market. Workers were demanding higher pay to keep up with inflation; at the same time, his investors complained that schools were spending too much on pay. By the end of 2023, losses had ballooned to $364.8 million. Higher Ground conducted two rounds of corporate layoffs. Some Guidepost schools offered tuition discounts if parents paid in advance. At one location, families who paid as much as $75,000 could win a trip to Paris. According to the Girns, they lent the company more than $5 million, while Ms. Girn deferred another $1 million in salary.
Mr. Girn maintains that his schools always had adequate resources. But Guidepost employees in multiple states told me their schools were regularly “out of ratio,” with too few teachers in the classroom.
Rylie Colvin, who ran a Guidepost in Washington State, said she was routinely told to combine toddlers from two classes into one room and send a staff member home for the day to keep payroll costs down. “We’re talking 1½-year-olds here. It’s illegal to have big ratios with kids that young,” Ms. Colvin said. “Never mind the fact that we’re telling families that we’re providing individualized Montessori lesson plans — and then just throwing them into whatever room.”
In Colorado, a regional manager had so many people quit at one of the schools she oversaw, in the Boulder suburb of Longmont, that for months she and an assistant had to run it themselves. She said that one day, only three Guidepost employees showed up to watch more than 100 children.
Ariel Baker, a Guidepost teacher in Scottsdale, Ariz., said her school became so understaffed that teachers stopped taking lunch breaks or regularly changing diapers. In one of the infant classrooms, an assistant teacher was fired for treating babies roughly. Ms. Baker said she asked if the incidents had been reported to the state. “I was told, ‘There’s nothing to report,’” she said.
Lucy Brooks, an assistant head of school at a Wisconsin Guidepost, said that an administrator accidentally stepped on a baby and lied to the parents about the cause of the bruise. In California, Mr. Richardson said, a toddler escaped and wandered around a nearby Walmart parking lot until someone finally noticed.
“There are cases where we made serious mistakes,” Mr. Girn said via text. “When I learned about an issue, I experienced it fully and as personally as if it was my own children, and made sure we faced it and fixed it.” He argued that with 150 schools, it was inaccurate “to assemble a few serious isolated incidents into a narrative that implies systemic negligence.”
But across the country, parents were becoming dissatisfied. According to company documents, in 2023, about 15 percent of Guidepost families were pulling out their children after just 90 days.
The Girns could see that conditions were deteriorating. “People would sign up and then we’d lose them,” Ms. Girn said. She visited struggling schools and was appalled by what she found. “I’m going to school after school that I think is garbage and I’m like, this has to be completely rebuilt from scratch.”
By 2024, the generous terms that Higher Ground had negotiated with landlords were rapidly coming to an end. “There was a timing issue,” Mr. Girn said. “We opened too many and it hit at once.”
In August 2024, Higher Ground stopped paying rent on all its schools. Two landlords, in Virginia and Texas, changed the locks on their buildings, causing schools to close with no notice. Other site owners sued. Over the next few months, many of Higher Ground’s executives quit. In February 2025, the Girns resigned. The company filed for bankruptcy that June, owing an additional $611 million in unpaid rent.
Eventually, more than 80 Guidepost schools were sold to a new entity, Guidepost Global Education, which is based in Austin and employs many people who had been on staff at Higher Ground. The company’s investors include both Learn Capital and Steve Xu, a former investment banker who was involved in the earlier effort to open Guidepost schools in Hong Kong and the mainland.
About 60 other Guidepost locations closed. Mr. Girn told me that the process was orderly, with most families given at least a month’s notice. But according to several parents, that didn’t always happen. When a Guidepost near Milwaukee announced that it would close in five weeks, so many teachers quit that the school lasted just three more days. “I’m in the parking lot, calling my boss like, ‘I can’t come in because Tommy’s day care closed,” said Jake Boyd, whose 5-month-old had just started there a few weeks earlier. For months, he and his wife looked for another day care, but everywhere was full. Their mothers flew in and took turns babysitting so the Boyds could go to work.
Guidepost Global partnered with a start-up called 2 Hour Learning. That company is the parent of Alpha School, a new for-profit chain where children are mainly taught by A.I. Under the agreement, Alpha and Guidepost Global would operate as separate entities in the same building, with Guidepost Global focusing on babies and preschoolers, and Alpha running elementary schools. But some schools that the Girns started already had an elementary program, and in those instances Alpha simply took over.
Parents were notified of this Montessori-to-A.I. switch just weeks before the start of a new school year. In California, Cecille Matsuo received an email inviting her to transfer her two children to Alpha for $50,000 per child. “I’m not paying $50,000 a year for a computer to teach my kid,” she said. She declined the offer.
In North Carolina, Cayla Guins also pulled her children after being told they’d be taught with A.I. She added up the tuition she’d paid Guidepost over the years — almost $200,000. She’d paid the money so her daughters could get a good education, but now she felt she’d been duped. Ms. Guins published an open letter to Mr. Girn on Substack, accusing him of “corporate hubris, broken promises, and the human cost of treating child care as a venture-backed commodity.”
Mr. Girn knows about the social media activity. He told me he’d read some of the posts. “A lot of people out there hate my guts and think I’m the devil incarnate,” he said. But he insisted his critics were wrong. Yes, his company had collapsed. Yes, children had lost their schools and their teachers. But, he argued, one of the reasons Guidepost had grown so big so quickly — and investors had been willing to give him so much money — was that it offered a service that was desperately needed.
Parents can’t work without child care, the economy can’t function without working parents and children deserve a quality education, he believed. And yet nationally this basic need remains unaddressed by both the government and the private sector. Guidepost had been Mr. Girn’s attempt to fix it. Thanks to him, tens of thousands of people had been exposed to what he believed was the best early childhood pedagogy. “I think that’s a victory,” he told me. “This is what it looks like to try to do something really hard.”
Besides, he said, a majority of schools he’d opened still existed, just under new management. One, in Williamsburg, Brooklyn, was such a standout that last year Guidepost Global offered me a tour. The school did seem nice. A few months later, though, a teacher was recorded on video yelling at and pushing toddlers while on a neighborhood walk. And in June 2026, a different teacher accidentally left a 3-year-old at a playground. New York City’s Department of Health temporarily shut down part of the school.
Guidepost locations that initially survived the bankruptcy have continued to close. At the end of this month, three schools in Southern California, including the one that the Girns’ children once attended, will shut their doors. “This is right at the start of the school year, and now all these families are going to be scrambling for spots at other schools,” said Andrew Quillin, whose 2-year-old daughter was supposed to start at a Guidepost in Laguna Hills. “It’s insane.”
Mr. Girn and I talked about the demise of his old schools while sitting in the classroom of his new one. A few months after leaving Higher Ground, the Girns bought a property in Texas Hill Country and turned it into a five-room schoolhouse of sorts. Maps lined the walls, a bedroom had been converted into a library and the living room was now a classroom. Tuition is $23,000. The Girns are developing the curriculum themselves.
The place seemed warm and inviting. And with four acres of surrounding land, there was plenty of room to expand — although Ms. Girn was adamant that she didn’t want to. When I asked Mr. Girn what he thought, he smiled.
“We’ll be back,” he said. “We have a world to save.”
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