Lambda School runs live, cohort-based nine- and 18-month courses in data science and full-stack web development with a $30,000 tuition charged on a sliding scale and paid only after students land jobs earning at least $50,000. Currently about 3,000 students are enrolled and the company employs roughly 150 staff, including teachers and team leads, all working remotely. The startup received approval from California’s Bureau for Private Postsecondary Education after prior regulatory difficulties, but that approval temporarily precludes offering Income Share Agreements (ISAs) in the state. Lambda does not offer accredited degrees, only certificates, and has no current plan to pursue accreditation. The company has faced criticism of its ISA model and operational challenges — about 15% of students drop out in the first month — but demand reportedly exceeds current capacity. CEO Austen Allred says the company intends to use the new funding to expand course offerings and potentially adjust its business model while aiming for profitability. Lambda School operates an online coding school offering programs in coding, data science and web design and is expanding its curriculum into cybersecurity and medicine (including short-term nursing programs). The company funds student tuition through income-share agreements under which graduates pay 17% of income for two years after earning at least $50,000 annually, with payments capped at $30,000; an upfront tuition option of $20,000 is also available and roughly 98% of students choose the ISA. Lambda reports that 83% of its graduates are hired within six months with a median salary of $70,000, and it partners with Leif to design and manage ISA programs while owning the ISAs itself. Because ISAs require capital up front, Lambda has raised equity to fund operations and student attendance before ISA returns are received. With the latest round it plans to build out its hiring network (expanding sales to bring in employer partners), pursue international expansion, and explore buying and reworking a nursing school to deliver regulated health programs online. The company was launched in 2016 and has raised nearly $49 million to date, including a $30 million Series B that values the business at $150 million. Lambda School is an online computer science academy that trains software engineers and data scientists through an income-driven tuition model that invests in students rather than charging upfront fees. The school covers tuition costs and requires repayment only after graduates find high-paying employment. Lambda offers full-stack engineering and data science courses and recently launched iOS, Android, and UX design tracks. It currently has about 700 students enrolled and has seen more than 75 graduates hired, with 83% of early cohorts employed and an average salary increase of over $47,000 per hired graduate. Leadership says the curriculum is being adapted to meet employer needs, and the school is building a more advanced hiring network to increase placements. The model and outcomes have attracted investor interest and enabled plans to expand course offerings and scale operations. Lambda School offers free, live and interactive computer science instruction that students can attend from anywhere, with sessions recorded for later review. Its model combines schooling with an investment-like approach to find and train untapped or underutilized talent for high-demand careers. The program emphasizes employer connection through over 50 hiring partners, including IBM, PayPal and multiple Y Combinator companies, and hosts Demo Nights for partners to meet graduates. Lambda School does not charge hiring partners recruiting fees for direct sourcing; instead it asks partners to apply any recruiting fees toward a student’s tuition. The recent seed funding is intended to cover the cost of education for thousands of individuals seeking new opportunities. Instruction is attendance‑required for live sessions and includes group work and archives for review.

Total raised

$122M

Funding rounds

4

Latest round

Series C

Latest activity

Aug 2020