Steven Klinsky and the price of a year

Steven Klinsky spent two and a quarter years getting a four-year degree. At the University of Michigan, Advanced Placement credit helped him finish early. He arrived in September 1974 and completed his studies in December 1976. The calendar was negotiable, provided he could demonstrate that he had learned the material. It was a useful discovery for a young student, and an idea he would eventually spend considerable money making available to other people.

First came a career in buying and building businesses. Klinsky co-founded Goldman Sachs’ leveraged buyout group, became a partner at Forstmann Little and established New Mountain Capital in 1999. By December 2025, the firm was described as managing $60 billion. Those are the conventional milestones. Running beside them is another career, in which the unit of progress is sometimes a school, sometimes an afternoon, and sometimes a year of college that a family no longer has to buy.

The shop before the spreadsheet

Klinsky grew up around Detroit, attended public schools and worked as a teenager in the family’s clothing stores. His grandfather had started Albert’s during the Depression. His father and uncle expanded it into a chain of more than 100 outlets. The family business offered an obvious future, until its sale in 1978, while he was in graduate school, removed that particular succession plan.

His initial interest in private equity was less remote from retail than the vocabulary suggests. He thought he might buy another business with his father. Behind the eventual investment firm stood the fairly ordinary prospect of working together on a company. A shop has customers, employees and expenses before it has an enterprise value. That upbringing helps explain why business building became such a persistent theme in his account of investing.

He earned an MBA at Harvard in 1979 and a law degree there in 1981 through the joint degree program. Economics and political philosophy at Michigan had been followed by business and law. His education crossed departmental boundaries, even as he shortened the time it took to complete it.

Learning to buy, choosing to build

At Goldman, from 1981 to 1984, he helped establish the leveraged buyout group and execute more than $3 billion in transactions. Forstmann Little recruited him in 1984; he became a general partner in 1986. For much of the following decade, he was its senior partner outside the Forstmann family. He helped oversee seven private equity and debt partnerships totaling more than $10 billion.

It was a useful place to learn both the possibilities and the temptations of the buyout business. Borrowing can amplify an investor’s return, but it also leaves a company with obligations that persist when business gets difficult. Klinsky’s eventual pitch for New Mountain would emphasize growing the underlying company and choosing industries with demand that could survive an economic downturn.

He calls that approach defensive growth. The combination sounds cautious and ambitious at once, which is rather the point: find room to expand without needing the entire economy to cooperate. It requires making judgments about what customers will continue to need, and about what a particular management team can improve.

His colleagues’ recollections add some texture to the philosophy. In the early 1990s, Tom Lister would find him at the office at unusual hours, working through a theory on paper. Away from his desk, he browsed Coliseum Books on West 57th Street. There are more theatrical ways to prepare for a deal. A sheet of paper has the advantage of being difficult to impress.

Whose idea gets heard?

Starting his own firm did not eliminate the uncomfortable part of being a founder. Even after years in private equity, raising a first fund brought rejection. Speaking to entrepreneurs and investors in 2025, Klinsky remembered the difficulty plainly: “You endure a lot of rejection.” A record at someone else’s firm still has to be translated into a reason to trust the new one.

His description of New Mountain’s internal practices is more interesting than a list of approved cultural adjectives. Employees write anonymous annual memos proposing sectors to investigate. The team scores the ideas. Associates participate in the investment committee from the beginning and must present their work and answer questions. Equity participation extends across the firm, including receptionists.

These arrangements give his preference for collaborative research something tangible to rest on. An anonymous memo deprives a title of its usual head start. Asking a junior employee to defend an argument gives that employee responsibility, along with an audience. Neither arrangement guarantees a good decision. Both make it harder to confuse seniority with an answer.

New Mountain also publishes a social dashboard, an annual practice dating to 2008. Its 2025 figures report approximately 101,100 jobs added or created at private equity portfolio companies during ownership, net of losses, and more than $10.4 billion in research, software development and capital expenditure. These are the firm’s reported measures. Their inclusion places employment and reinvestment alongside the more familiar language of returns.

Three hours after the bell

Klinsky’s education work began well before the website. In 1993, he established the Gary Klinsky Children’s Centers in memory of his older brother. The programs operated inside public elementary schools in East New York, Brooklyn. Instead of requiring a new school building, the idea used the existing one after the regular day had ended.

In a later oral-history interview, he described the centers as three-hour daily programs. Working with the children and teachers led him to focus on how the system was organized. He saw people worth backing and wanted more opportunity to shape the whole school day.

In 1999, he worked with the civil rights leader and minister Wyatt Tee Walker and others to organize Sisulu-Walker Charter School of Harlem, the first charter school to open in New York state. He wrote its application. The detail matters: his contribution included the unglamorous document that made the institution possible. Founding a school apparently comes with homework, too.

The after-school centers and the charter school approached different parts of a child’s day. They also established a habit of looking for a practical point of entry into education. Years later, college affordability would receive the same kind of attention: where, precisely, could a change help?

The credit was already there

Klinsky began describing the Modern States idea publicly in 2012. His first route involved trying to change accreditation in Washington. When that effort stalled, he turned toward an existing mechanism: College Board examinations that colleges already accepted for credit. His own Michigan experience had supplied a reason to take examination credit seriously.

Modern States launched publicly in 2017. It commissioned courses designed to prepare learners for College-Level Examination Program tests, known as CLEP. The intellectual work lay partly in connecting things that already existed: online teaching, subject examinations and college credit policies. Each connection had to hold for the promise to be useful.

“A digital public library of higher education.”

Steven Klinsky, describing Modern States

The library comparison captures the accessibility of the courses. The exam connection supplies a further purpose. Someone can study a subject, demonstrate knowledge and seek credit toward a degree at a participating institution. Watching a lecture and shortening a degree are different outcomes; the program was built to connect them.

The current catalog has 32 courses, aligned with CLEP subjects. Learners who meet the course requirements can receive a voucher covering the exam fee. More than 2,900 US colleges and universities grant CLEP credit, with their own rules and score requirements. Test centers may charge separate administration fees. Those details determine the savings a particular student can actually realize.

There is a pleasing economy to the idea. A course can serve many learners. A voucher addresses a specific expense. The accepting college retains control over its degree requirements. Klinsky found a way to work through an existing arrangement, making it easier for students to use something that was already possible.

What a saved year looks like

In its December 2025 review, Modern States reported more than 145,000 learner registrations during that year and an estimated $59 million saved in tuition and related costs. Learners passed 31 percent more CLEP exams than in 2024. Registrations measure interest; passed exams move closer to the result the organization is trying to produce.

Its improvements were often small enough to escape a grand announcement: revised courses, quicker vouchers, fewer delays between studying and testing. In January 2026, executive director Jefferson Pestronk described plans for further course improvements, evaluation partnerships and a limited trial of an AI tutor. The organization’s next steps concerned helping learners finish the work already in front of them.

Klinsky and his wife, novelist Maureen Sherry, have also supported education at the other end of the institutional spectrum. In 2013, they endowed Harvard Law School’s first professorship of practice. It was designed to bring leaders from fields beyond law into the classroom. Former Federal Communications Commission chairman Julius Genachowski was its inaugural holder. The degree might be legal; the examples were allowed to wander.

The family has had some experience with learning through unexpected routes at home. During a renovation, designer Eric Clough concealed an elaborate sequence of puzzles in their apartment for their four children. The surprises included riddles, hidden objects and compartments. Klinsky had supplied a poem; Clough developed the larger mystery. Even in a household familiar with complex transactions, opening the furniture acquired an unusually demanding syllabus.

That anecdote offers a lighter companion to the public work. A system can contain possibilities that are easy to overlook until somebody connects the clues. For a student taking a CLEP exam, the outcome is considerably less fanciful: a course accepted, a requirement met, a smaller bill. Klinsky’s own early graduation happened decades ago. He has since helped other people ask how much of the standard timetable they really need to purchase.