As states faced large budget cuts in recent years, forcing teacher layoffs and program freezes in the education arena, schools have had to to look to more unconventional methods of funding to stay afloat.

Private firms see the opportunity and are increasingly traversing into the public school system. Venture capital transactions in the K-12 sector skyrocketed to a record $389 million last year, from just $13 million in 2005, according to Reuters. The deals represent an effort to outsource items like math and special education to private firms.

A number of districts, such as Philadelphia's public schools, have also hired private consultants for advice on improving their systems.

Yet the privatization trend is wrought with controversy. Firms see K-12 education as a profitable field, while educators are torn between whether the influx of equity will optimize learning or limit educational autonomy.

Chet Linton, CEO of the for-profit School Improvement Network, took to MSNBC's The Cycle Friday to discuss ways to improve the U.S. education system that relies on cooperation between private and public sectors. The School Improvement Network is a private company that seeks to increase student achievement through teacher training and development.

"Budgets have been cut so much because of the economy that states don't have the people to vet resources or design resources -- and many states and districts that design their own ended up chucking those things that they did and are now saying, 'we need strategic partners that can help us,' and are looking to the private sector to help out," Linton said. "Because we're investing and we're very focused on looking at things nationally or even globally that have the greatest impact -- it is very difficult for states to do that."

Linton notes that despite the for-profit tag on the School Improvement Network, the company acts as a "strategic partner," and is transparent with districts so "they see what we're about and know what we're about," adding that their efforts have yielded positive results in test scores.

Watch the video above for more on the discussion.