Technology-rich alternatives to traditional higher education…
As students and their families struggle with the high cost of college, and while administrators ask if the current business model is sustainable, alternatives and supplements to traditional higher education are cropping up—especially in the tech world.
Tying Tuition to Outcomes
App Academy is a 12-week, 100-hours-per-week, learn-to-code bootcamp that ties payment to outcomes. Students put down a $5,000 refundable deposit to attend, but then pay a placement fee (not tuition) only after the student lands a job. This placement fee is set at 18 percent of first-year earnings, payable over a six-month period. App Academy runs programs in San Francisco and New York, where starting salaries for Rails software developers average $105,000 and $89,000, respectively.
Clearly, this business model puts pressure on App Academy to deliver results. And the program boasts some impressive numbers: 95 percent of those who enroll graduate, and 98 percent find employment. What may not be so obvious is the pressure it puts on the admission process.
App Academy looks for students with a natural talent for coding, tenacity and “a passion for building cool stuff.” Though its typical students are career switchers in their mid- to late-20s, it does not require any college coursework or work experience, but it does ask for ACT/SAT test results. After completing an application, potential students are directed to introductory coding resources and asked to complete a coding challenge, maybe two. If those go well, there is a phone interview with a live coding exercise. The good news: there is not much waiting—a decision is made within two days. The harsh reality: only around five percent of those who apply are admitted.
Another interesting twist to the App Academy business model is its admissions prep tutoring, offered at the rate of $125/hour. This tutoring is one-on-one remote tutoring conducted by App Academy teaching assistants. There is a suggested curriculum, but applicants are encouraged to direct their own tutoring. Based on increased coding ability gained during tutoring, App Academy estimates that chances for acceptance increase from three to 30 percent, but there are no guarantees.
Taking an Investment View
Tradecraft founder Misha Chellam attended Pomona College as an undergrad, and was himself questioning the return on investment of graduate schools. He founded Tradecraft in downtown San Francisco as a 12-week, $12,000 alternative to an MBA for those who want to learn how to start a business.
Chellam informally describes its mission: “a bunch of smart people working with other smart people, doing cool things while avoiding bureaucracy.” There are four tracks in the program: business development and growth (selling things), and user experience product design and software engineering (making things), with opportunities for cross-functional exposure.
Typical days cover new topics in a morning block, with applied project time in the afternoons, and include a talk from an active practitioner. Most of the project work is done for pre-seed Series A startups in which the stakeholders are actively involved.
In addition to the four “hard skills” tracks, there are career development programs to identify target sectors and companies, and to build relationships with key people for help in the job search process. There is also a personal development program led by an executive coach, focusing on the growth mindset and risk-taking.
Chellam reports that one-third of Tradecraft students are from outside the Bay area; students are 55-percent male, 45-percent female. Candidates come from four basic segments:
- Young go-getters. Early- to mid-20s, usually straight out of college; know where they want to go and see Tradecraft as the fastest path there.
- Accomplished wanderers. Mid- to late-20s, have done a couple of really interesting things but have no clear direction; want to use Tradecraft to consolidate skills and build a career path.
- Level-uppers. Mid-20s to mid-30s, professionally accomplished in tech, but want to keep building skills and career path proactively, not reactively.
- Career-switchers. Mid-20s to mid-30s, achieved excellence in a past career and now want to repurpose skills built in another industry and use them in the tech world—usually to start their own companies.
And it is this—the desire of students to start their own companies—that is the key to Tradecraft’s business model. Its goal is to break even on the course curriculum, but longer-term, it hopes to invest in the companies its graduates start. To this end, it plans to move away from a rigid 12-week course to one in which participants can stay as long as they need to. It also has plans to open a program in New York soon. iBi
Debra Clay is an independent education consultant based in Peoria, who helps match students with the right educational opportunities. She can be reached at [email protected]