No Tuition, but You Pay a Percentage of Your Income (if You Find a Job)
Income Sharing Agreements are gaining the attention of higher education and Wall Street. One early success story is getting a boost from venture capital.
What if there were a way to eliminate student debt? No, really.
Student debt reached a new height last year — a whopping $1.5 trillion. A typical student borrower
will have $22,000 in debt by graduation, according to the National Center for Education Statistics.
Now, Silicon Valley is backing a novel idea that proposes to rewrite the economics of getting an education.
The concept is deceptively simple: Instead of charging students tuition — which often requires them to take out thousands of dollars in loans — students go to school for free and are required to pay back a percentage of their income after graduation, but only if they get a job with a good salary.
The idea, known as an Income Share Agreement, or I.S.A., has been experimented with and talked about for years. But what’s happening at Lambda School, an online learning start-up founded in 2017 with the backing of Y Combinator, has captivated venture capitalists.
No Tuition, but You Pay a Percentage of Your Income (if You Find a Job) - The New York Times
