SecProbe.io

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

       DIVISION OF
CORPORATION FINANCE

 Mail Stop 3720
  October 5, 2007

 Ronald J. Packard Chief Executive Officer K12 Inc. 2300 Corporate Park Drive Herndon, VA 20171

 Re: K12 Inc.
  Form S-1/A
  Filed September 26, 2007   File No. 333-144894
Dear Mr. Packard:

We have reviewed your filing and have the following comments.  Where
indicated, we think you should re vise your document in response to these comments.  If
you disagree, we will consider your explanation as to why our comment is inapplicable or
a revision is unnecessary.  Please be as deta iled as necessary in your explanation.  In
some of our comments, we may ask you to provide us with supplemental information so we may better understand your disclosure.  Af ter reviewing this information, we may or
may not raise additional comments.   Please understand that the purpose of our re view process is to assist you in your
compliance with the applicable disclosure  requirements and to  enhance the overall
disclosure in your filing.  We look forward to  working with you in these respects.  We
welcome any questions you may have about our comments or any other aspect of our review.  Feel free to call us at the telephone numbers listed at the end of this letter.
 Our Company, page 1

 1. We note your response to our prior co mment 10.  Please provide additional
support to explain the basis for your dete rmination that the virtual public schools
you serve “generally test near, and in some cases above, state averages on standardized achievement tests.”

Mr. Ronald J. Packard
K12 Inc.
October 5, 2007 Page 2

Management’s Discussion and Analysis of Financial Condition and Results of
Operations, page 29
 Key Aspects and Trends of  Our Operations, page 30

Selling, Administrative and Other Operating Expenses, page 33

2. Please revise to explain the basis of your expectation that selling, administrative and other operating expenses, as a percenta ge of revenues, will decline over time.
We note that these expenses have remained  relatively stable as a percentage of
revenues over your last three fiscal years.
 Results of Operations, page 39

 Comparison of Years Ended June 30, 2007 and 2006, page 39

 3. We note on page F-10 that capitalized curriculum costs increased from $0.7
million to $8.7 million from fiscal year 2006 to 2007, please provide an
explanation as to why this increase occu rred and how the increase affected net
income.
 4. In your discussion of revenues on pages 40 and 41, you mention your addition of high school grades as a fact or contributing to revenue growth.  Please revise to
quantify the impact on revenue growth of  the additional grades in each of your
last two fiscal years as co mpared to other identified factors, such as new school
openings.
 Business, page 49

 Our Company, page 49

 5. Please revise the first full paragraph on pa ge 49 to clarify the distinction between
the seven virtual public schools to which you provide limited management services, mentioned in the first senten ce, and the additional 27 schools to which
you provide limited management services , mentioned in the second sentence.
  Competition, page 62

 6. We note your revised disclosure on page 63 in response to our prior comment 31.  We reissue our prior comment with resp ect to the market for providers of
curriculum and services to virtual pub lic schools.  Elsewhere you disclose
numbers of virtual public schools operat ing, numbers of st udents enrolled in
virtual public schools and companies providi ng curriculum and services to virtual
public schools.  Therefore, we believe you are able to provide a meaningful
analysis of your relative market position at least with respec t to virtual public

Mr. Ronald J. Packard
K12 Inc.
October 5, 2007 Page 3

school operations.  To the extent you disagree, please revise your disclosure to
explain why you are not able to provide su ch an analysis with respect to your
virtual public school operations.
 Regulation, page 66

 7. We note your revised disclosure in res ponse to our prior comment 32.  We also
note your disclosure in the last sentence of the paragraph entitled “State Laws
Authorizing or Restricting Virtual Public Schools” that  some states may require
new legislation before virt ual public schools can open in the state.  Please revise
to discuss the extent to which you belie ve new legislation would be required
before expanding your virtual school operations into new states.  For example, do you currently operate in most or all st ates in which virtual public schools are
authorized?  To the extent  there is significant uncerta inty whether virtual schools
are authorized in certain states, discu ss how you factor that uncertainty into
decisions whether to pursue e xpansion into new states.
 Compensation Discussion and Analysis, page 79

 Elements of Compensation, page 79

 8. We note your revised disclosure re garding the Compensation Committee’s
subjective determination that corporate goals were achieved in 2007.  However,
please revise further to discuss how indi vidual achievements were measured in
2007 and how such individual achievemen ts factored into your compensation
decisions.  In connection with this discussion, you should explain differences in compensation among the named executive officers and how such differences fit into your overall compensation philosophy and objectives.  For example, we note
that your named executive officers received bonus amounts in 2007 in differing relations to their respective target pe rcentages.  Additionally, Mr. Packard and
Mr. Davis received stock option grants in 2007 while the other named executive officers did not.
 9. We note your statement on page 80 that 2008 performance targets will be difficult
to achieve because they will require the Company to expand jurisdictions.  Please
revise to provide additiona l detail about the level of difficulty associated with
achieving your 2008 performance measures.  Pr ovide as much detail as necessary
without providing information that would lead to competitive harm.  Since the performance metrics associated with Mr. Packard’s option vesting schedules
appear to be different from your genera l corporate targets for bonus purposes, you
should discuss the difficulty associated with each of such metrics separately.
 10. We note your statement on page 80 that each executive will have an individual set of goals in 2008.  Please revise to prov ide additional detail ab out these individual
goals.  For example, discuss the nature of these goals, how they will be measured,

Mr. Ronald J. Packard
K12 Inc.
October 5, 2007 Page 4

how difficult they will be to achieve, how they will differ among your named
executive officers and how significant a factor in compensation decisions they
will be.  To the extent you cannot disclo se the actual goals, please explain in
detail why in your response letter.

11. We note your response to our prior comment  36.  However, it is not clear whether
the compensation committee has set the performance goals for 2008.  The first
sentence in the last paragraph in th e subsection entitled “Annual Performance
Bonus” indicates that the compensation co mmittee “plans” to set such goals, yet
next sentence implies that the “targets” ha ve already been set.  Clarify whether the
targets have been set.  If they have been  set, explain why disclosure of such goals
would not help in an understanding of  the compensation committee’s subjective
determination of the 2007 performance goals and

• how competitors and suppliers would be able to use your company-wide
financial targets to provide competitive ly useful insights into your pricing,
considering that historical informa tion about your financial performance
will be public information;

• how competitors’ ability to lure away talent would be materially affected
by disclosure of financial targets, considering that compensation from
completed years as well as your current compensation arrangements and
employment agreements will be public information;

• why disclosure of target levels is  not material to  investors; and

• whether information regarding your targ et levels is kept confidential and
the efforts you take to protect such information.

Your response should be a thorough and detailed analysis focusing on the specific facts and circumstances of your busine ss and targets.  You should address
separately each type of performance target you will use (whether for bonuses,
stock options or otherwise) and explain how  disclosure could lead to competitive
harm.
 Employment, Severance and Change in Control Agreements, page 81

 12. Please revise to explain why you entere d into new or amended employment
agreements with Mr. Packard and Mr. Baule in July, 2007.
 Outstanding Equity Awards at Fiscal Year End for 2007, page 84

 13. We note the 300,000 options with performance based vesting schedules that were
fully vested as of June 30, 2007 discussed in the penultimate sentence in footnote

Mr. Ronald J. Packard
K12 Inc.
October 5, 2007 Page 5

one to the table.  Please explain to us in your response le tter why you included
these 300,000 options in the column for unearned options.  Additionally, if the
jurisdictional and expansion targets have already been achieved, please disclose
them or explain to us in your response  letter why you believe such information
should be afforded confidential treatment.  In this regard, we note that the analysis
you provided in response to our prior comm ent 36 focused on the disclosure of
forward-looking targets.

Certain Relationships and Relate d-Party Transactions, page 90
 Policies and Procedures for Rela ted-Party Transactions, page 90

 14. We note the pre-approval of certain types of transactions discussed in the third
paragraph of this section.  Please advise us in your response letter, with a view
towards disclosure in your prospectus, whether you have a policy or procedure to
identify such pre-approved transactions to the extent they will be required to be
disclosed pursuant to Regulation S-K Item 404.
 Shares Eligible for Future Sale, page 101

 Lock-Up Agreements, page 101

 15. Please revise the paragraph regarding direct ed shares to be consistent with your
disclosure on page 105 regarding the pe rcentage of shares  reserved and the
underwriter reserving the shares.
 Notes to the Financial Statements,

Revenue Recognition, page F-7
 16. We note your response to prior comment 58. In regards to the student personal
computers offered to the students through th e schools, please explain to us your
consideration of lease acc ounting literature such as EITF 01-08 and SFAS 13 in
determining the appropriate revenue rec ognition policy.  In addition, it appears it
may be necessary for you to report these revenues separately on the face of your
income statement pursuant to Rule 5-03 of Regulation S-X.
 Note 4. Income Taxes, page F-13

 17. We note your response to comment 70 and the disclosure provided on page 39
and in Note 4.  In light of the fact th at you have earned income before income
taxes in 2007 and 2006, and have cumulative earnings before income taxes for the
most recent three year period, we do not understand why it is reasonable to consider “recent cumulative losses” as si gnificant negative ev idence in support of
a conclusion that it is more likely than not that you will not recover any of your deferred tax assets.  Provide us a f actually based explanation of why your

Mr. Ronald J. Packard
K12 Inc.
October 5, 2007 Page 6

conclusion that it is more likely than not that the Company will not generate any
taxable income through 2027 is  reasonable or revise.

18. Further, in your response to comment 70 under Future Taxable Income Exclusive of Reversing Temporary Differences & Ca rryforwards, you state that “due to the
reversal of certain temporary differences, taxable income is expected to be break-
even or an immaterial positive taxabl e income.”  Explain to us why your
benefiting from the reversal of certain temporary differences is not positive evidence in support of a reduction in the valuation allowance.   When assessing
whether the Company will have future taxable income exclusive of reversing temporary differences and carryforwards, you should consider the possibility of
taxable income before the effects of  reversing temporary differences and
carryforwards, not after.
 19. We question the accuracy of certain of your disclosures concerning the basis for
your policy of fully reserving your deferre d tax assets.  In the second paragraph
on page F-13 you state “the Company has historically generated tax losses and
therefore has no tax earnings history.”  In the first paragraph on page 39 you state
“[w]e are in a cumulative loss position as a result of our cumulative operations for
the years ended June 30, 2005, 2006 and 2007.”  Please revise these disclosures and your other income tax related disclo sures, as necessar y, and advise us.
 Note 9. Stock Option Plan, page F-19

 20. We note your response to prior comment 73. For grant dates during the one year
period preceding the most recent balance sheet date and through the date of your
response, please revise MD&A to discu ss of each significant factor contributing
to the difference between the fair value of the stock options as of the date of each
grant for the options and the estimated IPO price of the common stock of K12,
Inc.
 Other

 21. We note your response to prior comment 77.  Explain to us why you have not identified your separate regional opera tions or your operations for each school
system as separate operating segments in  accordance with paragraph 10 of SFAS
No. 131.
 22. So that we better understand how you have an alyzed the structure of your internal
organization and how, under the guidance in  SFAS No. 131, it is appropriate for
you to not report any segment information, please provide to us copies of all
reports of discrete financial information th at are available to your chief operating
decision maker.

Mr. Ronald J. Packard
K12 Inc.
October 5, 2007 Page 7

23. We note your response to comment 78 a nd we are considering whether the
acquisition of Socratic should be considered an acquisition of a business.  Notwithstanding this question or your reasons for not performing the income test
when assessing the significance of Socratic, provide us the results  of this test of
significance.  Also, provide us a copy of  the Socratic audited balance sheet and
income statement for its most recent fiscal year.
 Schedule II

 Allowance for Doubtful Accounts, page F-23

 24. We note that you deducted approximately  $1 million from your allowance for
doubtful accounts during the fiscal year ended June 30, 2007. Please discuss in MD&A the decrease in the allowance, including why it was necessary and its
impact on your results of operations, and a dvise us.  The extent the deduction has
materially impacted your results of ope rations, including how it has affected the
trends in your operations and specific income statement line-items, should be
made transparent to readers.  Provide to  us in your response to this comment an
explanation of how you accounted for the deduction.
 Part II, Exhibits

25. We note your response to prior comment 79.  We also note your disclosure in
your risk factors’ section which indicates that your c ontracts with four virtual
schools account for 49% of your revenues and that the loss of any of these
contracts would have a material adverse effect on your operations.  In light of
your dependence on each of these agreements, it would appear that each
constitutes a material agreement that should be filed as an exhibit to the
registration statement.  Please revise accordingly.

* * * *

As appropriate, please amend your regist ration statement in response to these
comments.  You may wish to provide us with marked copies of the amendment to expedite ou