- I strongly disagree with the notion
that everybody ought to attend college.
When I was going to high school,
nobody said anything other than:
"Go to the best college you can,
pay whatever it costs,
study what you love.
'Cause as long as you graduate from college,
you will be set in the rest of your life."
I think my generation was one of the first
to realize that that's fundamentally not true.
Now, I think we're getting to a point
where people are a bit more wise in that,
and they're weighing the costs and the benefits,
and they're making different decisions.
And in fact, I think the United States kind of misses that.
If I'm a student and I'm going to college,
if it doesn't work out, nobody bails me out.
How can we not only make it so that people can attend,
but how can we make it so that if it doesn't work out,
they don't pay anything?
My name is Austen Allred,
the Co-Founder and CEO of Lambda School.
Growing up in small-town Utah,
there wasn't terribly much going on,
so I basically lived on the internet.
It was a really special time for the internet.
It was just coming of age
and nobody really knew what to make of it yet.
There was eBay,
and eBay was pretty early in how search worked.
One of the things I got really good at
was finding things that were mispriced.
So something that would be one price in one place
and another price in another.
And I could buy it in that first place
and sell in the second place.
For me, being a kid, it was the first time
where I felt like I could be taken seriously.
I could be part of a community,
and instead of me feeling like being a kid
was the most important part of my personality,
it was more about my skillset and my abilities
and the way I could communicate.
I think teenagers are generally capable of much more
than we allow them to do.
I'm excited for a world where teenagers can contribute
in more meaningful ways
instead of feeling like there's only one path,
and that's high school until you're 18
and then college until you're 22.
I strongly disagree with the notion
that everybody ought to attend college.
I actually attended a couple of semesters of college,
and I just felt like it
was not a great learning environment,
and I wasn't getting as much out of it as I wanted to.
I thought it was really expensive,
even though, in retrospect,
I was going to one of the cheapest schools in the country.
I just felt like I wasn't getting the value
out of my time and my money that I wanted,
and I could better serve myself doing it on my own.
When I first dropped out,
everybody thought that I was crazy
and everybody thought that I was destined for failure.
I wasn't surrounded by other people who did the same thing.
And then, when I got to Silicon Valley
and I started spending time around other people
who dropped out of high school,
by people who dropped out of college,
traditional education just didn't matter nearly as much
as what people learned on their own.
There are a number of schools
that if you just look at the outcomes of the students
that attend relative to the debt that those students incur,
most students would have been better off not attending
that school in the first place.
And there are far more of those schools
than I think a lot of us would like to believe.
Even if it's the majority of students
who are better off for having attended college,
there are a lot of students
who really should be considering other paths
if it's right for them.
I don't think we talk about that enough
in the United States,
and we are far from accepting that as reality
or encouraging it, which I think we should be doing.
In software, there's this terminology
called software as a service.
So you can buy software off the shelf,
which is a one-time purchase,
or you can get a full experience in an enterprise product,
where somebody's job is to do a thing for you
using software.
I think of Lambda School as being that.
What we do is we provide the American dream to people,
and the American dream being upward mobility, stable income,
being able to provide for your family.
And that's what we try to do for all our students.
I normally describe Lambda School
as a school where you don't pay until you're hired.
Lambda School is entirely online.
We train people to be software engineers
and data scientists for no upfront tuition
in exchange for a piece of what you'll make later.
Generally speaking, the school is 6 to 12 months.
It was a fantasy in the beginning,
and in the early days, we just charged everybody upfront,
and we would train them to code,
and that was pretty much it.
And then, we had people all the time
that wished they would be able to participate,
but they couldn't pay us.
So we started trying to lower the barriers to entry
with the idea of an income share agreement.
Originally, I found a study by Milton Friedman
from sometime in the '70s
when he'd been talking about this idea.
And then, I found a small community of people
who had actually been thinking about experimenting
with the idea of an income share agreement.
Then, I paid a lawyer who used to work at the CFPB
to write literally just a document, kind of a contract,
and we started enrolling students.
We know that when a student enrolls in Lambda School,
we're going to lose money unless they get hired.
That is very different
than the traditional education system,
where no matter who's writing the check,
whether it's a lender or the government or the student,
I'm already paid, and what happens after that,
I don't have to worry about.
Our incentives are entirely aligned
with the incentives of the student.
And if they're not successful,
we lose out just as much as they do.
So that changes everything that we do about the school,
from what we teach, to who we enroll, to how we teach,
to how we work with employers after graduation.
It's just a completely different incentive structure
which forces you to be a completely different school.
We're moving from a world where you go to school
based on the marketing or the rankings,
and you're moving to a world where you're looking
at what the offering is.
Really, we're entering an environment
where what will determine which schools people attend
in the future is the outcomes.
And I think that is far, far healthier
than seeing who can do the best job of advertising.