Fast Crimes at Lambda School

A valuation of $1B for this business is crazy. Investors were simply underwriting students paying for trade school, there's no tangible tech innovation. Like Theranos, WeWork, and FTX - it's the story of a darling founder who has to justify an unrealistic valuation in a frothy market. They're living in an echo chamber where fraudulent behavior goes unquestioned because everyone wants the upside.

Salaries are based on scarcity. High-skill software engineers were rare at one point, because there weren’t many of them with experience or training. Programs like Lambda School increased the number of people who know how to code while decreasing quality, resulting in fewer unfilled jobs and lower compensation. And again, where is the innovation? In the sketchy ISA?

There's a fine line between the “fake it till you make it” ethos in Silicon Valley and fraudulent behavior that materially hurts investors and consumers. He clearly crossed the line by publicly and repeatedly lying, but he was also incentivized and encouraged to build a hyper-scale business on the backs of people lacking expertise in the job marketplace.

I believe teaching people how to code is a good thing. But it's not a venture-scale business, and never should have been valued as such. A sketchy financial instrument doesn't equal innovation.

With a fixed-cost tuition program, students who can't afford to pay don't go. This prices out students who would benefit from the program. There is also no recourse if you can't get a job from uni. How do u know if the teachers instructed you properly? Imagine paying $20k for the wrong instruction. Yikes.

The only time an ISA works against the student's favor is when the schools go after students who got a job working in something unrelated (which Lambda appears to have done a lot of) or students who were super successful, because they overpay for the instruction. The latter isn't that bad given the risk-free nature of the ISA, and the former can be resolved with legal action and regulation (which is what's happening).

That's just my $0.02, although I was a Lambda Grad who did the ISA and didn't have any issues.

Another piece of anec-data: I had a non-CS degree coming into Lambda, which definitely helped me during recruitment time. I think that had I gone into a CS program, I would have done fine and possibly even landed a better gig than I got after Lambda, but I didn't want to shell out $50k over 2 years on the chance of that happening, so I was happy to take the ISA. 5 years post-grad, I'm making 4x what I was making pre-Lambda, and my ISA was paid off after 2 years, but as is true with most things: your mileage may vary.

People don't want to code. People want to make a living, and the people who exported their jobs overseas and gig-ized what was left told them to "learn to code."

But, I guess, for many people in the US - they want any solution other than that.