I’ve been frustrated over the past week reading articles describing the claims of three students who are pursuing arbitration claims against Lambda School. While we strive to create a great experience for every student at Lambda School, we recognize that student complaints, including lawsuits, are inevitable for any school that trains thousands of students each year. However, these cases have generated attention that unfairly questions the integrity and accomplishments of Lambda School and its people by suggesting we have intentionally misled students about the outcomes for those who attend.
I want to be clear: this criticism is categorically false. We’ve always tried our hardest to paint a clear and accurate picture of the range and likelihood of outcomes for students who successfully complete our programs.
I find the recent articles particularly upsetting because the persistent focus on three complaints risks overshadowing the more than 2000 students we’ve helped land in great, often life-changing, jobs since Lambda School started.
I’m equally frustrated because the criticism fails to acknowledge that the current higher education system generally imposes no obligation on schools to ensure students will have adequate means to pay back tuition. If a student doesn’t land a job after attending a traditional university, they have essentially no recourse for the thousands of dollars of debt they have incurred. In the case of Lambda School, such a result is actually impossible. When using an Income Share Agreement (ISA) or CA Retail Installment Contract (RIC), students only pay tuition if they are hired in a high-paying job. The student protections already built into tuition repayment at Lambda School far exceed protections at the vast majority of schools.
The basis of the recent claims against Lambda School is that we intentionally misled prospective students about our outcomes in early 2018. This confusion dates back to a document that Lambda School shared with investors in 2018 that was improperly reported and misinterpreted by the press. Others have subsequently parroted the same assertion without performing their own analyses or taking the time to understand the data.
When talking about student outcomes the important thing to start with is, “What question are you trying to answer?” There are many different ways to measure student outcomes, and depending on what question you’re asking you’ll get a different answer.
Sports statistics offer a good analogy. Those who are sports fans are used to analysts presenting data in many different ways to answer slightly different questions about player performance. For example, a batter in baseball will have both a “batting average” and a “slugging percentage.” Both are measures of how well a player performs, but use different formulas to answer different questions. The average fan would look mostly at batting average, while a scout or coach would look at batting average, slugging percentage, and many other metrics in determining a lineup.
The same is true for measuring educational outcomes – there are many different ways to look at the same data, and you’ll get different answers depending on which question you’re trying to answer.
Take a hypothetical cohort of 100 students.
100 students enroll
75 students graduate
65 students are hired by employers
50 students are hired with a salary high enough to begin repayment
Nearly every school will produce an outcomes report that shows two numbers:
These answer the most common questions students have: “If I enroll in the school, what is the likelihood that I graduate?” “If I graduate and look for a job, what is the likelihood that I get a job in a reasonable amount of time?” Perhaps most specifically, students are wondering, “What is the likelihood I have to pay tuition without achieving a positive outcome?”
An investor in Lambda School, however, is trying to answer a different question. Investors are most interested in the sustainability of the school, and want to know: If Lambda School covers the costs of 100 students, what percentage are likely to begin payment in a short amount of time?
In this instance the answer would be 50% (50/100 = 50%).
All of the above numbers are accurate answers to different questions using correct information.
Allegations that Lambda School intentionally misled prospective students about outcomes stem from people looking at different measures Lambda School designed to measure different things, and pointing out that the numbers are not the same. They assert that because those numbers are different Lambda School lied. That’s not true. They are different numbers that precisely and accurately answer different questions.
To make sure that we are consistent when sharing outcomes data publicly we do so in reports that publish not only the data itself but also the associated methodology. More recently, we enlisted a prominent outside accounting firm to audit our reports. When we discuss outcomes data we generally do so by referring back to the most recent public report until the next report is produced. Because of the length of the Lambda School program and the time needed to support graduates’ job search, we publish reports every 6-12 months. We believe this provides the richest and most accurate picture of student outcomes and is consistent with the few other schools that also share data publicly.
We know Lambda School is not perfect and will always be a work in progress. For a school, we're young and we're constantly trying new things to see what helps our students find their fastest path to a great job. We know that there will always be some students who don’t have a great experience; it’s the reality for every school everywhere, and we welcome feedback.
At the same time, we hear almost every day from Lambda School graduates who thank us for changing their lives by helping them to qualify for high-paying jobs that they would never have been able to get on their own. These students recognize that Lambda School has taken a risk on them, by offering them training and placement at no upfront cost in exchange for their promise that if they find a high paying job they will “pay it forward" under the terms of the ISA (or RIC) to help others receive the same opportunity.
I’m grateful for their support and proud of what we have accomplished. I know we will only get better and better. Thank you to all of those doing so much work to make incentive-aligned tuition possible.