The Joan Ganz Cooney Center, with support from the Walton Family Foundation, has embarked upon a three-year initiative that aims to help shape educational technology products that address specific literacy outcomes. In 2023, the Cooney Center Sandbox was launched to help digital media innovators answer the following questions: "How do you know that what you are making is engaging and appropriate for kids? And, how do you know it will have a positive impact?" The Sandbox couples evidence-based approaches with co-design, a collaborative design method that invites kids into the product development process. Beginning in 2025, the Cooney Center Sandbox has sharpened its focus: to engage product developers targeting the science of literacy development. This project kicked off with an advisory meeting in November 2024, convening key experts in literacy, educational technology (edtech), and educators to ground and commence the three-year Sandbox for Literacy Innovations. This report captures highlights from the shared presentations and discussions and synthesizes key takeaways relevant for product developers who are creating innovative edtech solutions for use at home and school.