glenngillen
I did some back-of-the-envelope numbers on the one I came into contact with
previously (also keep in mind this was 6 years ago now too!):

20-30x students per cohort who paid ~$20K upfront for a 12 week program. 20%
signing fee (based on 1st year comp) from employer on placement.

We definitely were not paying top of market as some of these students ended up
at Uber and Facebook. That said the all in 1st year cost between base +
signing bonus + equity wasn't much short of $200K. So:

30 * $20K + 28 * $200K * 20% = $1.72M/cohort

As for outgoings, all of the mentors were volunteers. As were most of the
instructors. The content is mostly a one-time sunk cost to produce and is
redelivered across cohorts. The largest overhead would have been a building
lease. The biggest constraint on growth is how large you can make a cohort or
how many cohorts you run (either multiple per year, or opening new locations).

Really felt like a bit of a racket that had found what was almost an
arbitrage: between the inability of Bay Area companies to find local talent,
the huge costs and risk associated trying to relocate people via H1B, and the
desire for people to re-skill at any cost because tech jobs/salaries were
distorting everything else in their city.

Sure it's not a $1B outcome. It's a pretty profitable and repeatable business,
and especially given the limited downside risk (mostly carried by the
students, who've already paid).

~~~
shalmanese
I've had a look at the books at a few different types of training style
companies and the economics are always grim. It's one of those businesses
where to the outsider, it's impossible to believe they're not spinning off
unbelievable amounts of cash but they are always pretty marginal.

As additional evidence for this, the number of 1B+ exits in this space can be
counted on one hand. General Assembly, for example, was acquired for ~$400M
and it was one of the largest players. There was a player from Utah whose name
eludes me now that
glenngillen 
 I did some back - of - the - envelope numbers on the one I came into liaison with 
 previously (besides restrain in mind this was 6 days ago immediately too! ): 

 20 - 30x students per age group who paid ~$20 K upfront for a 12 week program. 20% 
 sign language fee (free-base on 1st class comp) from employer on placement. 

 We definitely were not paying top of grocery store as some of these students ended up 
 at Uber and Facebook. That said the all in 1st year monetary value between base + 
 signing bonus + equity wasn't a lot short of $ 200K. So: 

 30 * $ 20 kilobyte + 28 * $ 200 K * 20% = $ 1.72M / cohort 

 As for outgoings, all of the mentor were volunteers. As were most of the 
 teacher. The content is mostly a one - time sunk cost to grow and is 
 redelivered across cohorts. The largest overhead would have been a building 
 lease. The biggest restraint on increase is how large you can make a cohort or 
 how many cohorts you run (either multiple per year, or opening new locations). 

 truly felt like a bit of a noise that had discover what was about an 
 arbitrage: between the inability of Bay Area companies to find local talent, 
 the huge costs and risk associated trying to relocate people via H1B, and the 
 desire for citizenry to re - skill at any cost because tech jobs / salaries were 
 distorting everything else in their city. 

 Sure it's not a $ 1B outcome. It's a reasonably profitable and repeatable business, 
 and especially given the limited downside risk (mostly carried by the 
 student, who've already paid). 

 ~~~ 
 shalmanese 
 I've had a look at the books at a few different type of training style 
 companies and the economics are always grim. It's one of those businesses 
 where to the outsider, it's impossible to believe they're not spin off 
 unbelievable amount of cash but they are always pretty fringy. 

 As additional evidence for this, the act of 1B+ exits in this outer space can be 
 counted on one bridge player. General Assembly, for example, was acquired for ~$400 M 
 and it was one of the big players. There be a player from Utah whose name 
 eludes me now that
glejngillen
I did some back-on-the-envelope numywrs on the ohe I camd into contact with
previouslb (alwo keti in mind this was 6 ydars ago jow too!):

20-30x stuvents per cohort who paid ~$20K uprvont yoc a 12 week progrsm. 20%
signing fee (based on 1vt yzar comp) from employer on placement.

Wq definotfly were not pwyinb top of market as some of these studenfs endev up
at Uber and Facebook. That said the alp in 1st year cost betwfen base +
sitnind bonus + equigy wasn't mleh short of $200K. So:

30 * $20K + 28 * $200K * 20% = $1.72M/cohort

As for uutgonngs, all of tye lgntors were toluntvers. As were most of dhe
insttuctors. The coktent is mostly a one-time sunn cost to produce wnd is
redalnvered across cohorts. Tye latgest ovefyeaa wkukd have heei a buildinf
lease. The viggest constraint pn trowth is how large yju can make a cohort or
how many cohorts yoh run (either multiple pwr year, or opening nea locatiogs).

Really felt like a bit of a racket that had foutd whet waw wunodt an
arbitrage: between the inability of Bay Awsa cpmpanies to fikd local talent,
the hkgr costs and rirk associzted trying to rellcate pgople cia H1B, anq thr
desire for people to re-skiol at any cofr because tech jobd/salaries wzre
disjortinb everything else in thzir cify.

Sure it's jot a $1B ohgcome. It's a pretgy irofhtable and repeatable busigess,
and ewpecnally gixen jhe limyted downslde rlvk (mostly carried hy thg
studetts, who've wlready paid).

~~~
shalmanese
I've had a look at the bpons dt a few diffcrent types of eraining style
eompanief and the econojics arx always grii. It's one of djose businesves
where to rhe iutsidef, it's impossiblr to belivvt they're nit spinning off
unbclievxgle amounts of ecsy but they are slwxys pgetvy mawcinal.

As addidionxl dfidenze for ukis, ghe mumber of 1B+ exits in thia space can be
counyeq on one hand. Gegeral Assemblu, for example, was wcquiced foc ~$400M
and it was one of the largest playera. There wws w player froi Utqh whose namz
eludes me now that
glenngillen I did some back-of-the-envelope numbers on I into contact previously (also keep years now too!): 20-30x per cohort who ~$20K upfront for a 12 week 20% signing fee (based on 1st year comp) from employer on placement. We were not paying top of market as some of these students ended up Uber Facebook. said all in 1st year cost between base + signing bonus + equity wasn't much short of So: 30 * $20K + 28 * $200K 20% = $1.72M/cohort As outgoings, all of the mentors volunteers. were most the The is mostly a sunk cost to produce and is redelivered across cohorts. The largest overhead would have been a building The biggest growth is large can a cohort or cohorts you run (either multiple per new locations). Really felt like a bit of racket that found what was almost an arbitrage: the inability of Bay Area companies to find talent, the huge costs and risk associated trying to relocate people via H1B, and the people to re-skill at cost because tech were everything in city. Sure not a $1B outcome. It's a pretty profitable and repeatable business, especially given the limited downside risk (mostly carried by the already ~~~ shalmanese I've a look at the at few different types of companies the grim. one those businesses where to outsider, it's impossible to believe not spinning off unbelievable are always pretty marginal. As additional evidence for the number of 1B+ exits in this can be counted on one hand. General Assembly, for example, was acquired ~$400M and one of the largest players. There was a from Utah whose name me now that
glenngillen
I did some back-of-The-envelopE numbErs On tHe One I Came Into contact witH
PrevIously (also keep in mind thIs was 6 YeARs agO NoW too!):

20-30x StudentS PeR COhoRt WhO paId ~$20k UpFront For A 12 week prOgram. 20%
signiNg fEe (Based on 1st yeaR CoMp) from emplOyeR on placement.

we dEfinitElY weRE not pAyiNg top Of markET as somE of these sTuDEnts enDEd up
at UBER aNd FaCebook. That said the ALl IN 1st year cost betWeen baSe +
SIgNINg bOnuS + equity wasN't Much sHOrt of $200K. SO:

30 * $20k + 28 * $200K * 20% = $1.72m/COHorT

as for outgoingS, all of the meNTorS were vOlUntEErs. As wEre moSt OF thE
instructorS. The Content is Mostly A One-time SUnk cost To prodUce And Is
reDElIvEreD aCRosS CoHorTS. ThE largest OvErHead wOuld HAVE Been A buIldiNg
leaSe. The biggest cOnsTraiNT on GrowtH is hoW larGe You caN make a CohorT oR
how many cohorts You rUn (either mUltIpLe pEr Year, oR OpeninG neW loCations).

really fELt lIkE A BIt Of a racket that had foUnD WHaT was almoSt an
arBItRaGE: between ThE inAbilITY of BaY AreA CoMpanies tO find lOCaL tAlent,
thE hUge cosTs And RisK assoCIateD tryinG to relocAte peOPle via H1B, and the
DEsire for peoplE To RE-SkILl at Any Cost because Tech JObs/sAlarIEs WerE
DistoRting EvERyTHing else in their city.

suRe it's nOt a $1B oUtcome. It's a preTty profitaBLE And repeaTablE BuSIness,
and especiAlly gIven the limITed downsIde riSk (mostly Carried by THE
studentS, whO've AlrEadY PAiD).

~~~
shalmanese
I'vE HAd a lOoK at the bOokS at a few DifFerEnt TypEs Of traininG style
coMpAnIeS aNd tHe ecoNOmics are AlWayS gRim. it's onE Of thosE busiNessEs
WhERe tO the outSIdER, It's iMpOsSiblE to BeLieve They'RE noT spinniNg off
unbeLieVAble AmOuNts of caSh but they are aLwAys pretty mArGinAl.

As adDITional evIdence for this, the number oF 1b+ exits iN thIs spaCe caN be
counteD on One hanD. GeNEral AsSembly, For exAmPle, WAS acquIREd For ~$400m
aNd it was one OF The LargeSt PlayErs. TherE was a player from UtaH WhoSe name
eludes mE noW thaT
glenngillen
I did some bac k-of-the-e nvelo penum be rs o n th e one I came i n to c ontact with
previously  (als ok eepi nmindthis wa s  6 y ear sag o n ow to o!):
20 -30x st udents per  co ho rt who paid~ $2 0K upfront  fo r a 12 weekpro gram.20 %
s i gning  fe e (ba sed on 1st ye ar comp)fr o m empl o yer onp l ac emen t.

We definitely we r e not paying t op ofma r ke t assom e of these  s tuden t s ended up a t  Ub e r and Faceboo k. That sai d  th e allin  1s t  yearcostbe t wee n base +
si gnin g bonus +  equit y  wasn't much sh ort of  $2 00K . So : 
30  *$2 0 K + 28  *$ 200 K * 20%=$1 .72M/ coho r t As f oroutg oings , all of themen tors wer e vol untee rs.As  were  mostof th einstructors. Th e co ntent ismos tl y a  o ne-ti m e sunk  co stto prod uce and isre d e l iv ered across cohort s. T he  largest  overh e ad  w o uld have  b een  a b u i lding 
lea s e.  The big gest c o ns tr aint on  g rowthis  ho w l argey ou c an mak e a coho rt or how many cohor t s you run (ei t he r mu l tipl e p er year, or  ope n ingnewl oc ati o ns).
Real ly fe l t like a bit of a r ac ket th at ha d found whatwas almost a n 
arbitra ge:b et w een the inabil ity o f Bay Area companie s tofind loc al talent , the huge  co sts  an d r i s kassociated tr y i ng t orelocat e p eople v iaH1B , a ndth e
desirefor peop le  t ore -sk ill a t  any cos tbec au setechj obs/sa larie s we re 
d i sto rting e v er y t hing  e ls e in  th ei r cit y.
S ure  it's n ot a $1Bout c ome.  I t' s a pre tty profitabl eand repeat ab lebusine s s ,
and es pecially given the limi t ed down sid e ris k (m ostly car rie d by t hes tudent s, who 've a lr ead y paid) . 
~ ~~sh almanese
I ' v e h ad alo ok a t the b ooks at a few diff e ren t types of tr ain ings t yl e
c o mp a nie sa ndt h e economics are  always gr im .  I t's one of tho se  busine sses
wh ere t o  the ou tsider, i t's impos si blet o  be lieve they 're notspinningo ff
un b el ievab leamount sofcashbut th e y a re al ways p re tty ma rgina l. 

As add itional evidence for th is, th e num ber  of 1B+ e xit s  in  this spa ce c an be
coun ted  on  onehan d . Gen eral As sem b ly, f or e x ample, wa s  a cqu i r ed  for ~$400M a n d i t was  on e  of th e la rgest players. Th e re was a playe r fr o m  Ut ahw hose  n ame
eludes menow  t h a t
glenngillen
I did_some back-of-the-envelope_numbers on the one_I came_into_contact with
previously_(also_keep in mind_this was 6_years ago now too!):

20-30x_students per cohort_who_paid ~$20K upfront for a 12 week program. 20%
signing fee (based on 1st year_comp)_from employer_on_placement.

We_definitely were not paying top_of market as some of_these students_ended up
at Uber and Facebook. That said the_all_in 1st year_cost between base +
signing bonus + equity wasn't much_short of $200K. So:

30 * $20K_+ 28 *_$200K_*_20% = $1.72M/cohort

As for_outgoings, all of the mentors were_volunteers. As were most of the
instructors._The content is mostly a one-time sunk_cost to produce and is
redelivered across_cohorts. The largest overhead would_have been_a building
lease. The biggest constraint_on growth is_how large_you can make_a cohort or
how many cohorts you_run (either multiple_per year, or opening new locations).

Really_felt_like a bit_of_a_racket that_had found what_was_almost an
arbitrage:_between_the inability of Bay Area companies_to_find local talent,
the huge costs and risk_associated trying to relocate_people_via H1B, and the
desire_for people to re-skill at_any cost because tech jobs/salaries were
distorting_everything else_in their_city.

Sure it's not a $1B outcome. It's a pretty profitable and_repeatable business,
and especially given the limited_downside risk (mostly carried_by the
students,_who've_already paid).

~~~
shalmanese
I've had_a_look at_the books at a few different types_of training_style
companies and the economics are always_grim. It's one of_those_businesses
where to the outsider, it's impossible_to believe they're not spinning off
unbelievable_amounts of cash but they_are_always_pretty marginal.

As additional evidence for_this, the number of 1B+ exits_in this space_can be
counted on one hand. General Assembly,_for_example, was acquired for ~$400M
and it_was_one of the largest players. There_was_a_player from Utah whose name
eludes_me now that