This idea doesn't pass a common sense test to me - I'm sure bootcamps can be profitable, but the people running them are used to building things that scale. Bootcamps definitely don't scale. If these tech people were looking to get-rich-quick they surely wouldn't be running a school, of all things, even a profitable one.
20-30x students per cohort who paid ~$20K upfront for a 12 week program. 20% signing fee (based on 1st year comp) from employer on placement.
We definitely were not paying top of market as some of these students ended up at Uber and Facebook. That said the all in 1st year cost between base + signing bonus + equity wasn't much short of $200K. So:
30 * $20K + 28 * $200K * 20% = $1.72M/cohort
As for outgoings, all of the mentors were volunteers. As were most of the instructors. The content is mostly a one-time sunk cost to produce and is redelivered across cohorts. The largest overhead would have been a building lease. The biggest constraint on growth is how large you can make a cohort or how many cohorts you run (either multiple per year, or opening new locations).
Really felt like a bit of a racket that had found what was almost an arbitrage: between the inability of Bay Area companies to find local talent, the huge costs and risk associated trying to relocate people via H1B, and the desire for people to re-skill at any cost because tech jobs/salaries were distorting everything else in their city.
Sure it's not a $1B outcome. It's a pretty profitable and repeatable business, and especially given the limited downside risk (mostly carried by the students, who've already paid).
As additional evidence for this, the number of 1B+ exits in this space can be counted on one hand. General Assembly, for example, was acquired for ~$400M and it was one of the largest players. There was a player from Utah whose name eludes me now that had a, I think, ~$2B exit but that might be the only one.
Are you thinking of Instructure? They're based in Salt Lake City, and Marketwatch gives their current market cap as $1.86B
There are definitely people who can do a challenging Master's degree with minimal help and feedback, just books, marked essay assignments and a final written exam. This is a model that's as old as the University of London. TAs and structure will increase the proportion of those who start who actually finish.
What about running a school obviously doesn't scale?
They said bootcamps don't scale, not that education or schools as a whole doesn't scale. And your solution of raising the entry requirements so only people who can teach themselves can attend is proving their point. Someone who can teach themself isn't going to pay to go to a bootcamp, but people who want to switch careers and can't figure it out without help, will.
I mentioned two solutions, raising entry standards and providing greater support. There are people who can teach themselves. There are very few people who can teach themselves as fast and as well in a self-directed environment as they can learn with a real curriculum and some feedback on their work. If you are confident you can teach yourself in two years or reach the same level of employability after nine months of Lambda School the latter looks pretty good even at $30K once you get a job paying over $50K.
There’s no requirement they be part of the “tech scene” ... whatever that is.
The companies they're trying to get people hired into.