Are there any legit income-sharing schools of this type, tech or otherwise? Done fairly, it sounds like an interesting alternative to upfront tuition.
On the surface it doesn't seem like a bad model, but of course it could be twisted to evil ends. From the article:
> The loans carry substantial risk, as a single missed payment triggers a default and the remainder of the $30,000 “cap” becomes due immediately.
> Students were therefore deprived of rights they should have had when their “income share” loan was sold to an investor [without the required Holder Rule provisions transferring legal responsibilities to the new owners].
The math ends up wildly unfavorable unless you are EXTREMELY confident in your teaching/transformation abilities.
If you look good on paper before the school then you don't need it and won't be motivated to share your income. So the applicant pool reduces itself to those who on-paper don't have great chances. So you need to cause a really big delta in the ability of those people to make good money in the industry for you to be able to get your cut.
And you're gonna pull that off in 6 to 9 months? I'm a big believer in a lot more people having potential to learn than currently have easy opportunities, but that's a hell of a timeline.
I remember the marketing for App Academy was that we all would be self-taught, but then the actual makeup of the cohort were people who had prior programming experience (CS all through high school and as a hobby, but studied linguistics in college and regretted it; a designer who had done some JS and couldn’t pass leetcode interviews despite having current frontend skills, etc.)
I think the problem they’ve run into is that there are only so many of those types to go around, and you have to stay small or really tackle the problem of transforming someone in 12 weeks eventually. That’s a different and much harder ask.
Yup. When the Bootcamp market flourished (early/mid devBootcamp days) and incredible results seemed common it was exactly for the reasons you mentioned. Many early attendees were folks who either had some previous technical experience or were very smart and proved in some other field but wanted to move into dev work.
Eventually the majority of those folks who were going to make the switch... Did. Then the average bootcamp graduate became someone who bought into the hype that anyone could learn to code. A lot of truck drivers, CS reps, and teachers applied. There nothing stopping those people from becoming great engineers. But they are going to have a more difficult time on average than the person who dabbled in coding for ten years while working as an engineer in another field and just needs a crash course to be proficient in web development.
Placement rates dropped significantly around that time.
They literally ensured their success by filtering for people who would already succeed no matter what. I don't have any misgivings about it because the curriculum did help me focus on some gaps in my understanding and build up a profile/portfolio that could land jobs.
It's still expensive and had that curriculum been open at the time I could have done the whole thing on my own and saved some money.
The social aspects of the program didn't end up really benefiting my career at all. The vast majority of my cohort had STEM degrees from prestigious places or were people who were programming since an early age like me. I had already had a long career in IT before I attended. 100% did get jobs, but 2 of the guys in our cohort struggled for a while -- though I think that was to get out of paying the ISA.
Not necessarily, fresher or graduate trainee programs are this effectively.
Large companies especially conglomerates do this by hiring freshers and investing in their learning and benefit by paying a bit lesser than the market over the years .
Apprenticeship has also been successful economically at even a scale of one master/sole proprietor for centuries.
The key is to derive value while they learn, not split the learning and earning parts completely
There was a time about 5 years ago where tech companies were desperate to fill various minority quotas. The idea was those people were very valuable, there were very few applicants who were hotly contested by other tech companies, and lack of skills wouldn't matter - they'd learn on the job.
In that world, the school only has to get the students to do a "hello world" in python and apply for the right jobs. Such a school is very cheap to run, and very lucrative as long as a decent proportion of students fit into the desirable categories.
The students themselves usually aren't aware how desirable their application is - and therefore believe the school is their route in rather than a few youtube tutorials and a direct application.
Thoughtworks wrote in an email to me that they were only considering non-male candidates because of their quotas. The idea, I suppose, is that I should be willing to change my gender if I'm really interested in joining.
If they had quotas, they were made up internally. But more likely they were just lying to you, or the person who sent the email was twisting the truth. I don't think anyone but you thought of the "maybe you should change gender" bit. They just didn't want to hire you, personally.
I spoke to a bunch of lawyers who all told me they hoped I found some lawyer who would do that. The EEOC decided that if a manager directs their reports (engineers) to advertise a position, then people apply to the position as directed by emailing the engineers, then the engineers say some stuff about gender quotas, that's fine, because the applicant didn't fill out some other form and the company disavows this recruitment process to the EEOC while using it to source candidates.
Not that you’re arguing for or against, but I thought I’d drop an interesting link to a 2020 McKinsey and Co study that shows more diverse companies generally outperform their peers. [1]
Is there any wonder that Google and other (not exclusive to tech) companies desire this?
Plenty of recruitment teams get given targets. Just one 1 memo saying "hires that don't bring the company towards our diversity goals won't count for your metrics"...
> Are there any legit income-sharing schools of this type, tech or otherwise? Done fairly, it sounds like an interesting alternative to upfront tuition.
investing in startups is kindof like betting on the future potential of founders, though it's tied to a business idea.
Upstart started as a personal loan for students and expanded to other financial services, it went public recently. They innovated by doing the regular thing (student loans) better than the competition, rather than trying to be both the lender and the school https://en.wikipedia.org/wiki/Upstart_Holdings
> but of course it could be twisted to evil ends.
My speculation is that this was a 'road to {} paved with good intentions.' Just like most startup products face challenges in the real world, it sounds like the Lambda School tried everything they could to get high job placement rates, but weren't able to deliver at scale.
Then, as their early placement % dropped, they just didn't change the numbers in their marketing materials. After a certain point their early hopes and reality diverged enough to constitute fraud in the eyes of the CFPB
Anecdotally, we get a lot of applications for any software job posting, and I discard most of the resumes of recent bootcamp graduates. It's nothing against bootcamps, it's just a signal that the person is a junior engineer. And in the cases we have hired people with less work experience for junior roles, we've had a much higher signal-to-noise ratio in our interview process talking to people who completed traditional education (even if it was not directly a CS program) and have enough of those applicants as-is.
The income based repayment plans for federal student loans are not that different (but without most of the sketchy practices).
The fact that those are an option for accredited schools means I think it would be hard to make it work in a program like this. Especially if there is any sort of venture interest expecting actual returns. Actually educating people well is not cheap and I have not seen any of these programs that actually do anything innovative either.
App Academy (in a much hotter 2013 job market) honored its 10% of my first year’s salary ISA when I attended. Anecdotally from my cohort, they worked with people on missed payments without triggering a balloon repayment.
This isn’t the same type of school, but Purdue was an early experimenter with ISAs. Sounds like as of 2022 they’d paused new enrollments. [0]
As I recall, some critiques were that it was only deemed viable for a small range of STEM majors, and narrows the mission of the institution toward building earning power vs. providing a well-rounded education, being an intellectual/research hub for the community, etc.
Yes. Most states have a system where students attend school, receive an education, and pay the school back using a portion of their income after graduation.
They're often referred to as "public schools", and ISAs are often called "taxes".
Those schools still charge you $50k and take 4 years of your time, so I'm not sure how that comparison makes sense, particularly for working folks looking to uplevel their skills.
Those schools have not always charged $50k - that's a recent political choice. I'd point to student loan policy as the main driver [0].
Many bootcamps require full-time attendance, and many universities have part-time options. Further, community colleges are an option if the only goal is skill acquisition. Those programs take less time and are cheaper.
Yes, the one I did. Launch School (their Capstone program) is 1 year 18%ish ISA. Since, when I did it, 100% of my cohort got real-Dev jobs averaging 120k+, the school still got 20k+/student. They're the anti-lambda school in my book. If anything too modest in their marketing. Best decision of my life.
> I attended Launch School and found the founder and the program to be of high quality and integrity and the success of the capstone graduates speaks for itself.
Sorry errant >. It was based on my own experience. Launch School has a unique model where it's $200/month for the core curriculum which you complete at your own pace, and then can complete an optional capstone curriculum/project which comes with an ISA (18K or 18% of first year salary). Their outcomes are great, the curriculum is top-notch, and the founder always conducted himself with integrity and transparency. I had a great experience.
Thanks for sharing an ISA success story. Lots of us who used to teach at Lambda back in the day only did it because we wanted the ISA to succeed widely as a tuition payment mechanism.
That dream hasn't been realized, and certainly wasn't by Lambda, but I still hold out hope.
On the surface it doesn't seem like a bad model, but of course it could be twisted to evil ends. From the article:
> The loans carry substantial risk, as a single missed payment triggers a default and the remainder of the $30,000 “cap” becomes due immediately.
> Students were therefore deprived of rights they should have had when their “income share” loan was sold to an investor [without the required Holder Rule provisions transferring legal responsibilities to the new owners].