Bill Gates, borrowing a tradition from his mentor Warren Buffett, has published his first Annual Letter, his reflections on the work of the Bill and Melinda Gates Foundation, where he has been full-time since leaving Microsoft last summer.

Education commentators have focused on what they’ve characterized as a quasi-mea culpa in Gates’ discussion of the foundation’s 9-year, $2 billion investment in high school reform, particularly its effort to transform the nation’s large, often-alienating comprehensive high schools into smaller, more-personal educational environments. “We are trying to raise college-ready graduation rates, and in most cases, we fell short,” Gates writes, a declaration that some have interpreted as a suggestion that abandoning comprehensive high schools for smaller alternatives is an unfruitful reform.

That’s an unfortunate interpretation, because anyone who has spent time in the nation’s urban (and, for that matter, many suburban) high schools knows that the anonymity that pervades such schools contributes to a debilitating culture of apathy and alienation and is a root cause of the academic failure that afflicts so many American public secondary schools.

Not all large high schools are bad, of course. And not all small ones are successful–as the Gates Foundation discovered the hard way. But small schools are more likely to create the sense of connectedness among students and teachers, the sense of being known and valued, that motivates people to work hard. They encourage stronger bonds between students and teachers and generate a level of genuine caring and mutual obligation between them that is found far less frequently in large, comprehensive high schools. Small schools, in other words, are more likely to produce the conditions that make learning possible.

As Bill Gates points out in his Letter, that’s not enough. You also have to have high standards, a sound curriculum, and good teachers. Smaller schools are a means to an end, not an end in itself. But studies involving rural, suburban, and urban high schools have found that student and teacher attendance are typically higher in small schools. So are student involvement in extracurricular activities and graduation rates. Teacher turnover and student disciplinary problems are lower.

Because these results are necessary, but not sufficient, Gates has shifted much of its high school reform funding to networks of charter schools like KIPP, High Tech High, and Aspire Public Schools. As charter schools, they have more autonomy to address the other side of the reform equation—rigorous academic expectations, attracting top leaders and teachers, revamping the school day and school year to maximize instructional time, etc.

The Gates Foundation also gravitated to charter school networks because it learned that it’s a lot easier to establish a culture of success in a new school than it is to try to graft such a culture onto existing schools. Yet the schools’ powerful cultures, their sense of purposefulness, is also very much derived, their leaders are quick to point out, from the schools’ small size. The average charter school enrolls under 300 students, less than half the enrollment of traditional public schools, while some urban comprehensive high schools have as many as 5,000 students.

Unfortunately, there are only a relative handful of the new, high-performing charter schools that Gates praises in his letter, at most a couple of hundred that have made significant progress in closing achievement gaps for disadvantaged students. The financial and other challenges of increasing the number of such schools significantly are daunting. Which, perhaps, leads the Gates Foundation and others committed to school reform back to the traditional public school system—bearing the lessons it has learned from KIPP and other school networks.

Footnote: As some people know, I wrote a Gates-funded book several years ago called High Schools on a Human Scale, in which I made a case for abandoning comprehensive high schools, an argument that I had discussed more briefly in a 1991 book called In the Name of Excellence.