Lowell Milken | $1B+
Get in touch with Lowell Milken | Lowell Milken, cofounder of Knowledge Universe and a longtime leader in education reform and philanthropy, has built a wide-ranging career focused on improving teaching quality and expanding access to effective learning models. After an early career in law and finance, he helped develop Knowledge Universe into one of the world’s largest private education companies, spanning early childhood learning, professional development, and technology-enabled instruction. As chairman of the Milken Family Foundation, he has created nationally recognized programs such as the Milken Educator Awards and TAP: The System for Teacher and Student Advancement. Known for his strategic vision and commitment to education innovation, Milken is a defining figure in modern philanthropic efforts to strengthen America’s schools.
Lowell Jay Milken (born November 29, 1948) is an American philanthropist, investor, and advocate for education reform, best known for founding initiatives that recognize and enhance teacher effectiveness to improve student outcomes.[1] Co-chairing the Milken Family Foundation since its establishment in 1982 with his brother Michael Milken, he created the Milken Educator Awards in 1987, a program that has surprised over 3,000 outstanding educators with $25,000 unrestricted prizes, totaling more than $70 million in support for K-12 excellence.[2][3] In 1999, Milken founded the National Institute for Excellence in Teaching (NIET) and developed the Teacher Advancement Program (TAP) System, which has been implemented in over 1,000 districts to boost educator performance through mentoring, evaluation, and incentives, impacting 350,000 teachers and 3.5 million students with documented gains in achievement.[4][2] His business career includes work at Drexel Burnham Lambert from 1978 to 1989 advancing high-yield securities, followed by co-founding Knowledge Universe in 1995 and chairing real estate firms such as National Realty Trust and Heron International, contributing to a personal net worth estimated at $2.4 billion.[1][5] During the 1980s Drexel investigations, Milken was indicted in 1989 on charges of securities and mail fraud tied to alleged manipulative practices, but he maintained his innocence, and prosecutors dropped all 13 counts against him after Michael's plea agreement.[6][7] Beyond education, Milken's philanthropy encompasses the 1990 Milken Archive of Jewish Music, preserving over 600 works and 800 hours of history, and the 2007 Lowell Milken Center for Unsung Heroes, which has reached more than 3 million students globally by highlighting overlooked contributors to humanity.[2]
Early Life and Education
Family Background and Upbringing
Lowell Jay Milken was born on November 29, 1948, in Los Angeles, California, to Bernard Milken and Ferne Milken.[1] He was the second son in the family, with an older brother, Michael Milken, born on July 4, 1946.[1] Their father, Bernard (1917–1979), worked as an accountant for an accounting firm, and the family routinely assisted him with tasks during tax season, reflecting a close-knit household dynamic.[8] The Milkens were a Jewish family of Eastern European descent, with Bernard's parents having immigrated from Poland.[9]
The family resided in Encino, a suburb in the San Fernando Valley north of Los Angeles, providing a middle-class suburban environment during Lowell's formative years.[1] [10] Bernard's profession supported a comfortable but unremarkable lifestyle, centered in the growing post-World War II communities of Southern California.[9] Lowell attended California's public school system from elementary through high school, graduating from institutions in the region before pursuing higher education.[1] This public education background underscored the family's emphasis on accessible learning opportunities within a stable, working-professional home.[2]
Academic Achievements
Lowell Milken graduated from the University of California, Berkeley, with a bachelor's degree, earning Phi Beta Kappa membership and summa cum laude honors.[11][12] He also received the Haas School of Business's Most Outstanding Student Award.[13]
He subsequently earned a Juris Doctor from the UCLA School of Law, achieving Order of the Coif honors and serving on the UCLA Law Review.[14][11][4] In recognition of his contributions, UCLA School of Law named him Alumnus of the Year in 2009.[15][4]
In May 2015, Chapman University conferred an honorary Doctorate of Humane Letters upon Milken from its George L. Argyros School of Business and Economics.[1]
Business Career
Early Professional Roles
After graduating from UCLA School of Law in 1973 with honors including election to the Order of the Coif and service on the UCLA Law Review, Lowell Milken joined the Los Angeles-based law firm Irell & Manella as an associate.[16][17] There, he focused on corporate transactions, tax law, securities regulation, and business litigation, handling matters that intersected legal practice with emerging financial strategies.[17][18]
Milken's tenure at Irell & Manella, spanning from 1973 to 1978, provided him with foundational experience in structuring complex deals and navigating regulatory environments, which aligned with his growing interest in innovative investment approaches beyond traditional low-yield securities.[16][18] During this period, he balanced rigorous legal work with an entrepreneurial mindset, reportedly advising on business ventures that foreshadowed his shift toward finance.[1]
By the late 1970s, Milken's exposure to high-yield debt concepts—initially through client work and discussions with his brother Michael, who was pioneering such strategies at Drexel Burnham Lambert—prompted him to leave the firm for a full-time role in investment banking.[18][17] This transition marked the end of his early legal practice and the beginning of direct involvement in the high-yield bond market, though it built directly on the securities expertise gained at Irell & Manella.[16]
Drexel Burnham Lambert Period
Lowell Milken transitioned from legal practice to investment banking in 1978, joining his brother Michael Milken in Drexel Burnham Lambert's High Yield Bond Department (HYBD), which specialized in high-yield debt securities commonly known as junk bonds.[1] As a senior vice president, his responsibilities included research on distressed companies and real estate investment trusts, structuring investments, tax planning, and administrative functions within the department.[1] He initially managed personal investments accumulated by Michael on behalf of both brothers, serving as Michael's closest confidant and advisor at the firm.[18]
Milken played a key role in expanding the department's operations, overseeing the relocation of Drexel's HYBD, corporate finance, and retail departments to Los Angeles, which facilitated growth in the burgeoning high-yield market.[1] From 1981 to 1989, he led investment partnerships focused on leveraged buyouts, recapitalizations, and securities trading, contributing to innovative financing strategies that enabled access to capital for non-investment-grade issuers.[17] In 1979, he co-founded Otter Creek Associates with HYBD colleagues, an entity that generated returns exceeding 80 times the invested capital over the following decade through high-yield-related investments.[17]
Under the Milken brothers' leadership, the HYBD evolved into Drexel's primary profit center, driving the firm's dominance in high-yield underwriting and trading; Drexel reported overall revenues of $3.2 billion in 1987, with the department accounting for the bulk of earnings amid a boom in junk bond issuance exceeding $6.6 billion that year.[19][20] Milken's contributions emphasized operational efficiency and partnership structures, though his formal duties remained somewhat undefined, blending advisory, transactional, and managerial elements.[21] The period marked a transformative phase for high-yield finance, with Drexel underwriting deals for hundreds of companies previously excluded from traditional capital markets.[22]
Post-1980s Business Ventures
Following the 1990 bankruptcy of Drexel Burnham Lambert, Lowell Milken directed his business efforts toward education enterprises and real estate investments. In 1996, he co-founded Knowledge Universe, an education-focused company initially capitalized at $500 million, alongside his brother Michael Milken and Oracle co-founder Larry Ellison.[23] The firm expanded into early childhood education, online learning, and related services, growing to employ over 40,000 people globally by investing in subsidiaries such as LeapFrog and Nobel Education Dynamics.[17] [23]
As chairman and CEO of Knowledge Universe Education (KUE), a key subsidiary, Milken oversaw its development into the world's largest early childhood education provider.[1] In 2004, through Knowledge Learning Corporation—a Milken-controlled entity—KUE acquired KinderCare Learning Centers for approximately $1 billion, integrating it into operations that emphasized scalable child care and preschool programs.[24] KUE also supported investments in online education, including K12 Inc. (rebranded as Stride Inc. in 2020), which Milken helped advance from inception to a publicly traded entity in 2007, focusing on virtual schools and curricula delivered worldwide.[17] In 2015, Knowledge Universe divested its U.S. early childhood operations, including KinderCare, to Partners Group, a Swiss private equity firm, for an undisclosed amount.[22]
In parallel, Milken pursued real estate opportunities. Since 1995, he has served as chairman and major shareholder of Heron International, a London-based firm specializing in property development, investment, and management across Europe.[22] [25] From 1991 to 2021, he led a partnership that developed millions of square feet of industrial properties in Phoenix and Las Vegas, culminating in a portfolio sale.[17] In 2020, Milken became chairman of National Realty Trust, a private real estate investment trust formed from a prior property company (Propco), which raised $415 million in new equity and became the largest U.S. owner of early childhood center properties, often tied to KinderCare facilities.[26] Additional ventures include directing industrial, multi-family, retail, and storage developments in Reno, Nevada, since 2015, and initiating 3 million square feet of new industrial projects by 2023, with 6 million more in planning.[17]
Milken's broader portfolio encompasses stakes in technology firms, venture capital, and private equity funds, alongside oversight of family investment holdings diversified across sectors.[26] These activities have positioned him as a key figure in education infrastructure and commercial real estate, emphasizing operational scale and long-term asset growth.[22]
Legal Issues and Controversies
1989 Indictment and Charges
On March 29, 1989, a federal grand jury in the United States District Court for the Southern District of New York indicted Lowell Milken, alongside his brother Michael Milken and Drexel associate Bruce Newberg, as part of a 98-count indictment centered on alleged illegal activities at Drexel Burnham Lambert's high-yield bond department.[27][28] Lowell, then 40 years old and a managing director in Drexel's Beverly Hills office, faced 13 specific counts: two racketeering charges under the Racketeer Influenced and Corrupt Organizations (RICO) Act and 11 counts of fraud, including securities fraud, mail fraud, and aiding and abetting securities violations.[29][27]
The charges against Lowell stemmed from alleged participation in schemes to manipulate markets, conceal Drexel's ownership of securities, and facilitate insider trading, particularly involving arbitrageur Ivan Boesky. Prosecutors claimed Lowell assisted in "parking" stock—temporarily hiding beneficial ownership to evade disclosure rules and regulatory limits—such as in the case of Phillips Petroleum shares, where he and Michael Milken purportedly engaged in securities and mail fraud to aid Boesky's positions.[29][30] Additional allegations included wire fraud and false statements to regulators, tied to broader patterns of undisclosed gratuities and manipulative trading practices between 1984 and 1986 that prosecutors described as a criminal enterprise generating illicit profits.[31]
Lowell Milken and his co-defendants pleaded not guilty to all charges during arraignment on April 7, 1989, before Judge Kimba Wood, denying any wrongdoing and portraying the activities as standard Wall Street practices rather than criminal acts.[32][33] If convicted on the racketeering counts alone, Lowell faced potential penalties of up to 40 years in prison and $3.7 billion in fines collectively with co-defendants, though the indictment emphasized the Milkens' roles in a pattern of predicate acts like fraud on institutional clients and market manipulation.[34] The case arose from a multi-year U.S. Attorney's Office probe into Drexel's junk bond operations, triggered by Boesky's 1986 cooperation agreement, which highlighted systemic issues in high-yield securities trading but relied heavily on his testimony for specifics against Lowell.[35]
SEC Permanent Ban and Resolutions
In April 1990, the U.S. Securities and Exchange Commission (SEC) obtained final judgments of permanent injunction against Lowell Milken, prohibiting him from committing future violations of specified federal securities laws, including Sections 10(b), 13(a), 13(d), and 16(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.[36] Milken consented to the injunctions without admitting or denying the SEC's allegations of aiding and abetting fraudulent practices at Drexel Burnham Lambert, such as misleading disclosures and manipulative trading in high-yield securities.[36] These civil remedies followed the firm's 1989 collapse amid investigations into junk bond operations, where Milken had served as a senior executive.[37]
On March 18, 1991, the SEC instituted and simultaneously settled public administrative proceedings against Milken under Section 15(b)(6) of the Securities Exchange Act, resulting in a permanent bar from association with any broker, dealer, investment adviser, investment company, or municipal securities dealer.[38] The bar stemmed directly from the prior injunctions, reflecting the SEC's determination that Milken's involvement in the enjoined violations warranted exclusion from the securities industry to protect public interest.[38] Unlike his brother Michael, who faced criminal conviction and substantial fines, Lowell Milken avoided felony charges, which federal prosecutors reportedly dismissed in exchange for Michael's guilty plea, though civil enforcement proceeded independently.[7]
The resolutions emphasized remedial measures over admissions of liability, with Milken cooperating by providing testimony and information to regulators, as noted in SEC proceedings.[36] No separate disgorgement or civil penalties specific to Lowell Milken were detailed in the primary SEC orders, though broader Drexel settlements in 1989 required the firm to sever ties with him, impose leaves of absence, and withhold portions of his compensation, including half of his anticipated 1988 bonus.[39] These outcomes aligned with the SEC's pattern in the Drexel cases, prioritizing industry expulsion for key figures to deter recidivism without necessitating full evidentiary trials.[38]
Criticisms and Defenses
Lowell Milken, as a senior executive in Drexel Burnham Lambert's high-yield bond department, drew criticisms for his alleged involvement in securities law violations that contributed to the firm's 1989 collapse. The U.S. Securities and Exchange Commission (SEC) filed civil charges against him in September 1988, accusing him of aiding fraudulent transactions, including manipulating stock prices and facilitating undisclosed conflicts of interest in deals involving client Ivan Boesky.[40] These practices were said to have generated hundreds of millions in illicit profits for Drexel and its clients, with Milken's department generating over $2 billion in annual revenue by 1988 through aggressive junk bond underwriting that critics argued prioritized short-term gains over market integrity.[41] Detractors, including regulators and rival Wall Street firms, portrayed Milken and his brother Michael as emblematic of 1980s excess, where high-yield bonds fueled leveraged buyouts but allegedly masked risks and enabled insider advantages, leading to Drexel's $650 million SEC settlement in April 1989.[40]
In March 1991, the SEC imposed a permanent bar on Milken from associating with any broker-dealer or investment adviser, along with a cease-and-desist order prohibiting future securities law violations, based on findings of his role in over 50 fraudulent acts from 1984 to 1986.[38] Critics, such as University of Missouri-Kansas City professor William Black, who investigated savings and loan failures, described Lowell and Michael Milken as the "brain trust" behind Drexel's operations, implying systemic deception in bond sales that misled investors and destabilized markets.[42] Unlike his brother, Lowell faced no criminal indictment or conviction, but the civil sanctions underscored perceptions of complicity in a culture of regulatory evasion, with Drexel's plea agreement requiring his leave of absence and restricting his bonuses.[43]
Defenders of Milken argue that the SEC charges, while resulting in settlements, lacked admissions of guilt and reflected prosecutorial overreach amid the era's anti-Wall Street fervor rather than proven criminality.[44] Milken denied the allegations and, alongside his brother, challenged aspects of Drexel's agreements with regulators, asserting that high-yield bonds democratized capital access for growing companies, financing innovations that traditional investment banks overlooked.[45] Supporters highlight his post-Drexel pivot to philanthropy, co-founding the Milken Family Foundation in 1982, which has invested over $500 million in education reform and human capital initiatives, suggesting a legacy of positive impact unmarred by criminal findings.[46] Events like the 2023 UCLA discussion on "The Myth of Michael Milken" extend defenses to the family's role, portraying the scandals as exaggerated narratives driven by envious competitors and regulatory bias against disruptive finance.[47] These views emphasize empirical outcomes, such as the junk bond market's role in economic expansion, over unsubstantiated claims of fraud.[48]
Philanthropic Endeavors
Establishment of Key Foundations
Lowell Milken co-founded the Milken Family Foundation in 1982 alongside his brother Michael Milken, serving as its chairman from inception.[2] The foundation was established to advance innovative approaches to human potential, with an initial emphasis on education, medical research, and community support.[46] Under Lowell Milken's leadership, it has grown into one of the nation's prominent private foundations, directing resources toward scalable solutions in these areas.[2]
In 1986, Lowell Milken established the Lowell Milken Family Foundation as a separate private philanthropic entity.[49] This organization focuses on cultivating human capital through initiatives in education and innovation, aiming to strengthen communities by enhancing knowledge, skills, and experiences.[50] The foundation supports targeted programs that promote effective teaching and leadership development, reflecting Milken's commitment to evidence-based philanthropy.[3]
These foundations represent the core of Lowell Milken's philanthropic infrastructure, predating many of his later initiatives and providing the platform for broader endeavors in education reform and nonprofit support.[49] Both entities operate independently but align with Milken's overarching philosophy of empowering individuals through practical, results-oriented interventions rather than traditional grant-making.[2]
Focus on Education Reform
Lowell Milken's education reform efforts center on elevating teacher quality as the primary lever for improving K-12 outcomes, informed by decades of research, school visits, and policy analysis.[2] He has advocated for systems that provide ongoing professional development, career ladders, and performance incentives to attract, retain, and advance effective educators, arguing that student success hinges on access to skilled teachers rather than solely structural changes.[4] This approach, developed through the Milken Family Foundation established in 1982, emphasizes empirical evaluation and scalable models over broad mandates.[2]
A cornerstone initiative is the Milken Educator Awards, conceived by Milken in 1985 and first presented in 1987, which honors early- to mid-career teachers and principals with $25,000 unrestricted cash prizes during unannounced school ceremonies attended by dignitaries and media.[14] Unlike traditional awards, it requires no applications, relying instead on state education officials to nominate based on demonstrated excellence, innovation, and leadership potential, with selections prioritizing impact on student learning.[51] By 2023, the program had recognized over 3,000 educators across all U.S. states, aiming to spotlight teaching as a high-status profession and inspire career entry among top talent.[14]
In 1999, Milken introduced TAP: The System for Teacher and Student Advancement, a multifaceted framework implemented in schools to foster teacher growth through weekly professional learning, mentor support, evaluation rubrics, multiple career paths (e.g., master and mentor teachers), and bonuses tied to student progress and peer evaluations.[52] The National Institute for Excellence in Teaching (NIET), founded by Milken in 2005, scaled TAP nationwide, partnering with districts to embed these elements, resulting in implementation across over 1,000 schools by the 2010s.[4] Independent studies, including a 2023 National Bureau of Economic Research analysis, link TAP to higher student test scores, graduation rates, and long-term earnings, attributing gains to enhanced teacher effectiveness and retention, though some evaluations like a What Works Clearinghouse review found mixed short-term achievement effects in initial years.[53][54] Over two decades, TAP has reached more than 350,000 educators and 3.5 million students, with over 100 supporting research studies.[52]
Milken's policy influence extends to advocating for human capital reforms in federal and state discussions, including integration of TAP principles into teacher preparation programs at over 100 universities and contributions to legislation emphasizing educator evaluation.[4] His work earned the 2017 James Bryant Conant Award from the Education Commission of the States for advancing public education through innovative practices.[55] These efforts reflect a data-driven commitment to causal mechanisms like skill-building over ideological prescriptions, prioritizing measurable student gains.[2]
Other Initiatives in Arts and Nonprofits
In 1990, Lowell Milken founded the Milken Archive of Jewish Music, a nonprofit project dedicated to documenting, preserving, and disseminating the diverse body of sacred and secular music associated with the American Jewish experience, spanning genres from classical compositions to klezmer traditions.[56][57] The archive has produced extensive recordings, videos, photographs, articles, essays, and oral histories to highlight the universality of Jewish cultural contributions across faiths and backgrounds, with efforts including the Oral History Project of American Jewish Music in partnership with UCLA's Lowell Milken Center for Music of American Jewish Experience.[11][58]
Through the Lowell Milken Family Foundation, Milken provided a $2 million endowment in June 2017 to the Hoffmitz Milken Center for Typography at ArtCenter College of Design, aimed at advancing typographic education, research, and public visual literacy amid evolving digital media.[59] The funding supported curriculum development, interdisciplinary partnerships such as study abroad programs and online courses, faculty and student awards totaling over $175,000, and the establishment of a typographic materials archive to explore typography's role in emerging visual communication.[59]
Milken established the Lowell Milken Center for Philanthropy and Nonprofits at UCLA School of Law, launched on February 15, 2024, as a hub for scholarship, thought leadership, and professional development in nonprofit law and policy, offering resources for students, faculty, and sector leaders to address legal challenges in philanthropy.[60][61] The center facilitates events like panel discussions and workshops to strengthen governance and compliance in the nonprofit ecosystem.[62]
Recognition and Legacy
Major Awards and Honors
In 2017, Lowell Milken received the James Bryant Conant Award from the Education Commission of the States, the organization's highest honor, recognizing his sustained philanthropic efforts and dedication to advancing American education through initiatives like teacher recognition and policy innovation.[63][55] The award, presented at the National Forum on Education Policy, places Milken among notable past recipients such as Sal Khan and Thurgood Marshall for transformative contributions to educational practice and equity.[64]
Milken has also been honored with the Friends of Education Award by the National Association of State Boards of Education for his work supporting state-level educational improvements and leadership development.[1] Additionally, he and the Milken Family Foundation jointly received the Outstanding Friends of Education award from the Horace Mann League, acknowledging their advocacy for public education reform and recognition of exemplary educators.[1] These distinctions highlight Milken's emphasis on empirical approaches to teacher effectiveness and systemic change, drawing from data-driven programs he founded.
Broader Impact on Policy and Society
Lowell Milken's initiatives through the Milken Family Foundation have advocated for systemic changes in K-12 education policy, emphasizing teacher effectiveness as the primary lever for student achievement. In 1999, he introduced TAP: The System for Teacher and Student Advancement, a structured framework that integrates ongoing professional development, performance-based compensation, and teacher leadership roles to enhance instructional quality.[65] This model, implemented in over 200 schools across multiple states by the early 2010s, has influenced district-level policies by promoting data-driven evaluations and merit recognition, with studies from partnering organizations reporting average student growth exceeding state norms by 10-20 percentile points in participating schools.[4]
Through the founding of the National Institute for Excellence in Teaching (NIET) in 2005, Milken extended this approach nationally, partnering with school districts to scale teacher advancement systems that prioritize skill-based progression over tenure-based models.[52] NIET's efforts have shaped policy discussions on educator evaluation, contributing to frameworks adopted in states like Louisiana and Tennessee, where reforms tied teacher pay and retention to measurable student outcomes, aligning with empirical evidence that high-quality instruction accounts for up to 50% of variance in student performance.[66] These programs underscore a causal focus on human capital development, countering traditional union-driven structures that prioritize job security over results.
On a societal level, the Milken Educator Awards, launched in 1987, have recognized over 3,000 educators with $25,000 unrestricted awards, fostering a cultural shift toward viewing teaching as a high-status profession and drawing talent into the field.[14] By 2025, the awards program operates in 10 states, indirectly influencing workforce pipelines and public discourse on education's role in economic mobility, as evidenced by alumni networks advocating for reform at state legislatures.[67] Milken's broader philanthropy, including the 2011 establishment of the Lowell Milken Institute for Business Law and Policy at UCLA, extends this impact to interdisciplinary policy research, though its direct societal effects remain nascent and centered on evidence-based governance rather than partisan agendas.[1] Overall, these endeavors prioritize empirical outcomes in human potential, with quantifiable gains in educator retention and student metrics validating their approach amid persistent debates over centralized versus localized education control.
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