May 6, 2019

Education is risky. That’s not something you’d hear from many educators, but it’s true. It’s the risk of time. It’s the risk of borrowing. It’s the risk of whether it’ll work. This risk prevents people from getting what they want from an education: a better future.

For historically disenfranchised groups, the risk is even more acute. Years of discrimination and bias mean that these groups are more likely to lack the financial resources and geographic advantages to invest in an education. Therefore, if we want everyone to have a fair shot, we need to start talking about risk.

Geographic Risk

Where you live impacts your earning potential, it impacts your health, and it impacts your access to education. The further you live from an educational institution, the less likely you are to succeed or attend in the first place.

But where you live is not always a choice. You might have familial obligations (like taking care of a sick parent) or financial constraints (e.g. the rent is too damn high) that limit where you get to call home.

Today, more than ever before, geography reflects wealth and segregation. Rents and property values in urban areas have skyrocketed pushing out many long time residents. At the same time, educational institutions have been busy creating campuses in these same high rent districts. Proximity to educational institutions is now a luxury many can’t afford.

Financial Risk

Education has an opportunity cost—the time you spend in school takes away from earning income or spending time with family. Considering that most Americans have less than $1,000 in savings, it’s not surprising that going back to school is a difficult financial choice for most.

Additionally, the ROI of education has declined relative to its costs. Over the past 20 years, tuition prices have doubled while average wages have largely remained flat. Burning Glass reports that 43% of recent college graduates are underemployed. Education used to be considered a safe investment. Like a treasury bill, you always got more back than what you put in. Now it feels more like a junk bond—you’re not really sure what you’re going to get.

A different approach

Education doesn’t have to be this way. Since our founding nearly seven years ago, we’ve been finding ways to remove risk. First, we tackled geographic risk. Instead of physical locations we decided to bring our learning experience online. That allowed more people within the same metropolitan area to access our programs. That’s why we have students in places like Alpharetta, Georgia and Wayland, MA. In the case of the latter, an online program allowed a stay-at-home mom to become a software engineer.

Next we tackled financial risk. It wasn’t enough to train people with the skills they needed for a new career—we had to provide them a job. That’s why we rolled out our tuition refund guarantee. Any Thinkful graduate who does not find employment within six months of graduating gets a tuition refund. Could you imagine your undergraduate university or trade school making that promise?

We also made the startup costs more affordable. Last year, we rolled out our Income Share Agreement. Students can now complete a full time Thinkful program without paying any tuition upfront. And for people faced with the choice of going back to school or keeping the lights on, we introduced our Living Stipend Program. Now students in select cities can receive a $1,500 living stipend to cover expenses. We can’t wait to roll this out to more cities in the future.

Promising Early Results

Our internal numbers suggest we are moving the needle in the right direction. While Thinkful doesn’t require graduates to list their ethnicity, 35% of those who chose to self-report identify as ethnic minorities. Additionally, 30% of graduates who chose to list their genders identified as women. It’s a promising start but we obviously have a long way to go.

In 2019, we launched a new motto: #EveryDay10LivesChanged. That means by 2020, ten Thinkful students will launch an exciting new tech career every day. In order to meet this goal we’ll need to help more people from more diverse backgrounds access our programs. Let’s continue to de-risk education together.

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