Students of BloomTech, FKA Lambda School, file class-action lawsuit
businessinsider.com
businessinsider.com
One of the saddest parts of this whole debacle is that a lot of bootcamp students are unaware that most normal colleges have sliding scale tuition.
They see the “sticker price” of private college tuition being $50-$60K per year and think that a $40K boot camp is a bargain. What they don’t know is that $40K could actually be more than what they’d have to pay for a lot of universities, given their financial situations. There’s an argument that a 1-year boot camp could get someone into industry faster, but given all of the terrible anecdotes coming out of this particular bootcamp it’s hard to argue that it’s anything other than a terrible deal for students.
For some students if they do a year at a bootcamp and then manage to get a $100k job, paying back $40k isn't hard and better than 4 year university.
What percentage of the attendants are able to do so?
I’m just explaining, not advocating for the point of view.
I can’t understand how you’d need 130 million to operate over 5 years. Someone is losing at the end of the day and it is probably the investors.
Like if you raised 74 million in 2020 and lay off half your staff a year later, then lay off half your staff again another year later, what in the world are you spending money on? Legal fees?
Total cost per student was $13,000, of which $2,500 went to student acquisition (online ads?). Average revenue per students was $5,750.
Since 2021, they've lost a ton of their executive team, including a cofounder. I find that a pretty clear sign of where things are going.
I’d bet that if these lawsuits (or regulators) forced them to cut the dishonest marketing, their acquisition costs will increase.
In percentages yes, as you note. But in raw numbers, that’s insane!
Ad placements (simplified) can be geared towards CPA or ROAS - the former would be towards getting conversions, the latter towards ensuring a return on said conversions. Neither directly implies that you should be spending a massive % of your revenue for it.
Instead, they launched way too early and produced, by all accounts, mismanaged courses, with constantly changing content.
If they can't get that right, would you really expect them to get the other stuff right?
It's like a ponzi scheme/MLM in a sense because the cohorts who learn the material don't really know "why" they are teaching it. It's like having professors teach theory and then TAs taking over while the professors move on with life. Is that the right way to do education? To learn from someone who is one cohort ahead of you? Then they pad resumes and LinkedIn endorsements with everyone in the cohorts, not actual professional work.
I saw this happen at places like DevMountain (Utah) where I think the cofounders picked it up. It made for very confused students who couldn't get answers to basic questions about iOS controls. I saw a lot of this type of activity in the Utah tech scene. I don't know how to feel about it.
Demand (companies) has dried up and turns out you cannot easily get into a tech job doing some simple cookie cutter courses.
It's not really true that the students at these were trying to fast-track into highly paid jobs per se. Half or more were skilled professionals with masters degrees. A lot of high-burnout fields represented: disproportionate (and alarming) number of teachers and nurses in there, as well as like ex-goldman analysts, tons of mechanical and civil engineers as well.
Everyone assumes these were full of like, bartenders chasing money (which there is nothing wrong with that either) but in my experience it wasn't true at all. It was mostly late 20s-early 30s professionals who were looking to change to another skilled career, mostly due to burnout, poor fit in the first one, or more autonomy.
> turns out you cannot easily get into a tech job doing some simple cookie cutter courses.
No, you can't easily get into a tech job from these courses. But more interesting to me it showed that you can do a tech job from doing these courses. I've worked with code school grads a lot after that as well, in fact I seek them out when hiring. It's true that a fresh code school grad has a narrow slice of competence and needs more and different kinds of support than other junior devs. But they can succeed if given it, and ones a couple years or more into their careers tend to punch well above their weight in my experience. It's a group that is basically self-selecting for confidence and calculated risk-taking. They do well.
Yeah I was surprised when I realized most of the bootcamp grads I met were elite school graduates in things like BioE or Industrial Engineering who wanted to transition to tech. They had worked in their fields and wanted a change so they had the money saved up to do a bootcamp. It was no surprise to me that they did well in tech as they were already from STEM programs in great schools anyway.
I've heard anecdotally (no real proof) that later cohorts started drawing more of the "bartender chasing money" types (again nothing wrong with them) which made the competition for the schools a lot harder.
Bootcamps will still be needed as new tech needs to be learned quickly to fill vacant positions.
This is still done. It's called college, only takes 3 years.
At that time it was an incredible job market for new developers, so the “pay us once you get a job” model made a lot more sense back then (obviously, the current job market makes it seems borderline insane). I chose to pay upfront for my course because a job search would have been significantly less fruitful for me due to visa requirements, and as it played out, it was a good decision for me. In the current market, paying upfront with alternate financing probably makes sense for a lot more people.
The curriculum was definitely solid. A highly motivated person with some prior tech experience could maybe cover the same ground in their own 3 months of self-directed study for 8-10 hours a day, but the expert guidance on-hand and the boatload of testing to validate the learning doesn’t seem reproducible for an individual. In my opinion, computer science degrees are simply not in the same game as either focused individual learning or a bootcamp - they do not teach nearly as much of the day-to-day developer skills like the shell, git, React, Rails, etc., their theoretical learning of data structures and algorithms is less focused on practical early career content, and the pace is much slower so the total content is less. (I think this understanding that compsci degrees aren’t lined up with junior developer roles is borne out by the general view in tech hiring, that a compsci degree is neither necessary nor sufficient to make a hire, though it is a positive.)
Edit: https://www.ycombinator.com/blog/changes-at-yc Oh it just says they're doing less late stage investing. They didn't announce a specific policy. And LambdaSchool wasn't late stage since they started the same year YC invested in them (but depending on what happened that year maybe not super early stage). Still, YC may miss a LambdaSchool by focusing on the archetype of founder they had in the early days.
> they enrolled because they were attracted by the high job-placement rates in tech. They allege that the school had false and misleading information about job-placement rates on its website and on CEO Austen Allred's Twitter account
In law, a plaintiff can seek monetary damages or equitable relief. The latter is generally only available when money damages are insufficient, and it is harder to win equitable relief than money damages.
For example, in the Twitter/Elon case, there was a question as to whether Twitter could successfully sue Elon for the equitable remedy of "specific performance" (making someone perform a specific action). It would have been perhaps unprecedented to force a reluctant bidder to purchase a company against his will.
I find it interesting that these plaintiffs are going for equitable relief, when money damages would seemingly suffice. Just give the plaintiffs whatever money is due on their loans, which would then be used to extinguish the loans. I don't understand why they're going for an equitable remedy, which is harder to get. (For example, there is the "clean hands doctrine", which requires that one “who comes into equity must come with clean hands.” [1] This doctrine does not apply when plaintiffs merely seek money damages.)
1: https://www.law.cornell.edu/wex/clean_hands_doctrine#:~:text....
Lawsuit here: https://webapps.sftc.org/ci/CaseInfo.dll?SessionID=508D6DF1F...
If a student's debt is based on their future income, damages could be $0k right now, only because they're under the threshold where an ISA applies. In a few years they could cross that threshold through their own work, having gained nothing from the bootcamp, and suddenly be on the hook for upwards of $30k.
That said, if a predatory code bootcamp didn't teach me to code, I'd be pretty discouraged from continuing knowing that I'll still have to pay the grifters.
Not only is it not in precedented to force a reluctant bidder to purchase a company against their will, but the very judge who was assigned to Elon Musks’s case forced a company to buy another (i.e. “specific performance”) in 2021. Look up Snow Phipps vs Kcakes.
It’s not a coincidence that Musk suddenly changed his tune and went through with the acquisition. I’m sure that his legal team told him that he was going to lose the case.
Survivor bias takes care of promoting the educational system or institution with successful alumni, whether the alumni were taught while they were students, or merely selected during the application process.
i wonder Lambda they have settled in the past.
i figure, how much would it cost them to let these kids out of their contracts - most of which were presumably worthless anyways? unless they had already sold them to SVB or similar? also, give the lawyers some money, and keep it all quiet? prob less than this latest round of bad press.
but maybe a couple of things stopped this:
1) lambda / bloom was not confident this would be the last lawsuit, and
2) all press is good press. any time you're running what is at heart, in my estimation, a scam, there is really no amount of bad press that is going to stop a certain subset of people for signing up -- and, really, maybe the bad press actually lends you some credibility as a business -- i.e. if you have _no_ haters at all, are you really even a business today? like nascar and baseball and chelsea and so many others -- if you ain't cheatin', are you even tryin'? everyone has to bite on an MLM at least once in their lives to _really know_ that it's a scam. and, if you're broke and desperate, 'they' can't get money from you anyways, and maybe you'll win the lottery. lambda school or crypto -- go ahead and buy that lottery ticket.
Does this need an editor? Or is their lawyer just illiterate.
well the ones suing are the ones who couldn’t find a job and not happy about it. simply not having to pay up is not much of a consolation.
I would be curious about the proportions of the three groups among the plaintiffs - if you did badly afterwards there’s no financial loss, if you did well financially afterwards, I think it’s hard to argue that the course didn’t help?
I guess the contention point is companies promising a 6 figure base salary with no experience or college degree. While there is precedent for this, it's not the median income for bootcamp graduates, and if it was, it would be restricted to specific geographic locations.
My own experience was that getting into software development took up about half of my free time from around age 12 to 18 and after some fumbling around some friends and I were at an intermediate hobbyist level before graduating high school (probably at or just barely beyond the level of the best bootcamp students). We even ran a couple of clubs. I didn't do an internship, but just found part time work building simple CRUD apps for a few local small businesses (low stakes contracts of a few thousand bucks were awarded thanks to a friend who was playing with daddy's money while finishing his business degree). Then I got my first "real job" (salaried, benefits, etc.) a few months after finishing an accredited bachelor's degree in CS at my state school. The rest has been my actual career until now (I finished college about a decade ago).
I'm pretty sure this is the only "reliable" way and it wasn't easy. I had a couple of mental/ego breakdowns along the way because I found out I'm just kinda smart and not a genius, I didn't grow up to be a millionaire game designer like Carmack or Romero, and I became somewhat out of shape. I think this is... such a painfully average life story?
I mentored people at a coding bootcamp in Europe, there were some students with unrealistic expectations. Sharing real-life programmer careers help to stay grounded.
Coding is a job, like the other kinds of jobs. It is sometimes closer to craftsmanship than engineering. Maybe we won’t change the world, but arguably we might change it to the worse anyways :-)
The other part of the story is I have a failure of an older brother who doesn't work, has huge amounts of debt, and has told me a few times he's intrigued by the idea of a coding bootcamp and regularly blows me off when I try to teach him anything. Like I said I come from a trashy place, and I shouldn't have to explain how incredibly rude and dismissive of my entire life he's being by telling me something like that. I feel exactly the same way about bootcamps. They're entirely dismissive of a lifetime of effort I'm sure many others reading this have also put in. What makes you think it's possible to compress that when it's hard enough as it is even for those of us who had no other options? Are you saying you have something figured out that we didn't? You are certainly saying it can be done quicker and cheaper by running a bootcamp and I don't agree. Nobody will pick up your slack and train these people on the job and not even ChatGPT will make them more productive because they don't know what they don't know. They'll just be fired immediately and the further we go into the future, the hostility towards people who don't know what they're doing will only increase.
I guess I'm not really upset at you, but just deeply worried for anyone who takes a bootcamp and thinks that's a substitute for school when it's only the beginning of a much longer process I know few of them will ever complete. What about the rest who fail and are out that money? It's gotta be a worse success rate than just getting a real degree!
What I think is reasonable to teach in a one year full-time coding program is the ability to learn programming. There are some “secret components” also to make the learning experience smoother/faster, but these are “just” constant optimizations.
"Learn programming" means different things to different people. To me and probably to many hopeful bootcamp students it means a much broader scope: the ability to successfully complete any coding work thrown their way to a professional degree. Much like knowing a natural language like a native. That can't be taught in a year. That misalignment of expectations is the concern I'm voicing.
> What a person can reasonable learn outside of a job
Not sure what's meant by "job". You can learn anything outside a job. It's just a matter of how much time you have. What's for sure is nobody wants to hire someone they need to hold by the hand. The places that do are the worst places to work because they want someone naive they can pay low wages (usually bad startups). A good candidate should ideally have some experience via internship, contract work, open source contributor, etc. The lines between volunteer, paid hobby work, and part time job can be blurry when starting out and that's the best place to learn when starting a career because the stakes are low. This too definitely takes more than a year.
You really have no comparative data here. College is a life-crushing mistake for millions of people. I'm not trying to defend or condemn BloomTech (I really don't know if the allegations are true) but it's 100% true that two competing things can both be extremely bad.
Coding camps charge $10k of more, some require a certain percentage of income, and you don't even get a credential. How many companies are looking for coding camp graduates, compared to companies that are looking for college grads?
College is a life-crushing mistake for millions of people.
It is a mistake if you do not graduate, but the data shows grads earn way more and have half the unemployment rate of high school grads.
Universities charge more and guarantee nothing in terms of job placement, but nobody sues them. Just goes to show how much people will happily pay for a status symbol.
Do you know how a class action works? A comparatively small group of people file a suit and ask the court to certify a class of plaintiffs, i.e. a set of people that meet some definition. If the court certifies it, then the ultimate settlement or judgement will bind all members of that class even without any participation on their part (unless they opt out).
The proposed class does not consist of 4 people. There are just 4 lead/representative plaintiffs.
Uh… sometimes.
It's not that the bootcamp is bad per se, or even that it's worse than a university. Schools (including universities) cannot lie about outcomes.