How much you make per student * how many students = revenue.
How much you make per student is a factor of how much they’re getting paid.
If we help a student get hired for $90k they’ll pay us back $30k. So if we place 3,333 students/yr at that price point over the long run we’ll do $100m/yr in revenue. Of course, that’s a lot of students, but that’s also a lot of revenue, yet a tiny fraction of the total market of up-and-coming software engineers.
Cost of capital is very real, and it’s one thing to say that and another thing to do it, but we don’t have to replace the university wholesale for that to work, we just have to be the best trade school there is.
MOOCs are great, but are hardly the be-all-end-all of education. Content is everywhere, ability to actually learn from it is more difficult, and expert help, structured end-to-end curriculum, a community of learners on the same pace, etc. just make for a better learning experience. Sometimes it feels like if I made a nickel for every time I heard, “I learned more in 3 weeks of Lambda School than a year of self study” I could fund the whole company.