February 22, 2016
Holberton School, an alternative college experience that’s become known for its disruptive software engineering curriculum, has a very special and unique pricing model: students will only pay when they can, this is, they pay nothing during the course of their education, and only pay when they find a job.
Estimated at over $1 trillion, student debt is a serious problem in the United States of America. It has more than doubled since the beginning of the new millennium, to the point of overcoming the volume of purchases made with credit cards.
In 2008, the average debt by degree amounted to $23,200 – a little lower in the case of degrees issued by public universities ($20,200). In a difficult economic context, clearly marked by a high unemployment rate, a growing number of debtors are finding themselves unable to pay their loans, as the students’ default rate rose from 5 percent to 10 percent between 2008 and 2011.
Even though the prices of tuition fees keep rising, a college degree remains a good investment in statistical terms, despite often coming with an unprecedented burden of financial worries. However, according to the former Secretary of Education William Bennett, only 150 of 3,500 US Colleges are worth that investment.
Holberton School’s model makes it easier for students to focus more on their education, leading to better results and the formation of better professionals. The school does generate its revenue, but only after its students land a job – when they do, 17 percent of their salary goes to the school, for as long as 3 years.
In this harsh economy it can be hard to get a job, which only helps to increase the numbers of student debt. Opting for this pricing model, Holberton School is not only helping to drop those numbers, it is also aligning the interests of both the school and the students: the success of the students becomes the only key performance indicator of the school.
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