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Lambda School lays off 19 employees
- deleted 7y ago[deleted]
- 737min 7y agoPrediction: Lambda will be out of business within 12 months.
- creddit 7y agoWilling to provide some background reasoning for this prediction?
- olds 7y agoNot the OP, nor am I a bear on Lambda School, but I'll articulate the bear case. Lambda School is just another source of talent/human capital to a company. And companies suddenly aren't hiring and probably won't be for a while. And if they aren't hiring, Lambda School can't place students. And if they can't place students, then there are no ISAs, which is how Lambda makes its money. It's a straightforward funnel that's about to have a ton of supply and less demand, with Lambda bearing the financial burden to train/education the people. On top of that, if you have a bunch of people taking all this time to be trained under the pretense of getting a pretty good paying job and now that's not going to happen, well you're not going to be too thrilled with Lambda School (rightly or wrongly). So you've got, potentially, a double whammy: less revenue and your best marketing channel (word of mouth) going south. Not great.
- sct202 7y agoIf they go bankrupt I wonder if they'll sell off the Income Share Agreements or if they expire or something.
- troydavis 7y agoThey’re already bundled and sold on the Edly ISA Marketplace: https://lambdaschool.com/the-commons/announcing-our-new-isa-financing-blueprint-and-100m-in-new-financing https://lambdaschool.com/the-commons/announcing-our-new-isa-..., https://edly.info/investors/ https://edly.info/investors/
- jhwang5 7y agoNot to be cynical here but such a marketplace allows buying/selling human capital... i.e. slave market.
- troydavis 7y agoThe ISA buyer doesn’t have any control of or influence over whether or how much someone works (nor how much they earn). If the ISA seller wants to spend their whole life relaxing on a beach, they can. So, although you may not like ISAs, comparing it to slavery trivializes actual slavery. Also, it seems like you’re being cynical without realizing it.
- perl4ever 7y agoI have no first hand knowledge of Lambda and maybe they're the worst thing ever, but whenever I see a comment dripping with venom that doesn't even make any sense to me, I think what on earth do these people think of conventional rip-off for-profit schools that you pay up front?
- deleted 7y ago[deleted]
- tomhoward 7y agoIt’s an empty, pointless prediction; easy and uncontroversial to make now when things look grim (for everyone), and zero cost to you if it turns out to be wrong. I know little about the details of Lambda School’s business, but they seem like they’re in a good position to do well in an economic downturn and recovery, if they stay focused and prudent, which seems to be exactly what they’re trying to do now.
- ac29 7y ago12 months is a bit arbitrary if taken literally, but I think the writing was already on the wall for bootcamps as an industry before the current economic crisis. Bootcamps that only get paid when their graduates get jobs are even worse off - if hiring falls for software engineers, its going to the be the bottom tier candidates that get hit hardest. Folks coming out of a short program with little to no other experience are going to be greatly disadvantaged when experienced folks with better education are getting laid off and competing for a reduced pool of jobs.
- tomhoward 7y agoSuccessful startups aren't like bottles floating at sea, being carried to success or failure by the waves and currents. Sure, favourable macro trends help, but the ones that succeed do so because they best figure out how to adapt to changing conditions. Lambda School has complete freedom to change everything they do to survive and thrive in the new environment. Let's see what they do.
- keeptrying 7y ago19 employees seems such a small number that you can’t but think they could have as easily not fired them and just cut everyone’s pay?
- caseysoftware 7y agoWhich is more demoralizing? Doing layoffs or cutting everyone's pay? Doing a round of layoffs - especially done respectfully - can soften the blow a little while requiring only senior leadership's buy in and some input from managers. Convincing everyone to take a 15% pay cut takes a ton of coordination across the entire company and probably drives the rumor mill fast and furious. And imagine being one of the people who says "no"!? Further, with layoffs, you can choose who to cut. If people get demoralized as you're negotiating pay cuts, the top people can pack up and leave. I don't like any of it but it makes sense.
- ruffrey 7y agoCutting everyone’s pay by 15% would likely lead to attrition of top performers, rather than bottom performers.
- bluedino 7y agoOn the other hand, those who are likely to remain loyal will stay. I worked at a place that went through hard times and the employees that stuck around were 'untouchable' in the owners eyes, for better or for worse.
- usrusr 7y agoThat's the conventional wisdom, but I'm not convinced that it applies in the current situation. Is anyone hiring, I mean other than more Amazon warehouse drones? (sorry pickers for that rude language, you know that you are more important now than said top performers)
- cassalian 7y agoI work for a company that processes job applications for many other companies so I can say: yes, people are hiring, particularly in software, and it's actually up 3% from the glorious pre-covid days
- benatkin 7y agoFor an idea of what percent of employees this is: https://lambdaschool.com/the-commons/2019-a-year-of-incredible-growth https://lambdaschool.com/the-commons/2019-a-year-of-incredib... They added 125 in 2019, and there were 40 at some unknown time during 2018. That would mean at least 165. There's a photo which was taken sometime in 2019 while the 125 were being added, which may not include everyone. They may have also hired more in the first couple months of 2020. It seems they had somewhere between 165 and 250 employees. This would mean the 19 employees are between 7.5% and 11.5% of their workforce.
- lwb 7y agoWhy is education affected negatively by COVID? It is the last sector I would expect. I'm sure many are doing fine but IIRC Ryan Florence had to lay off his React teachers as well.
- blihp 7y agoBecause many schools aren't teaching via the web, they're closing for the year. Many (but not all) kids, without the threat of a failing grade, just aren't that interested in furthering their education.
- matthewcford 7y agobut lambda is an online-only platform:?
- blihp 7y agoRight. The assumption being that with schools being shut down they would see increased business as a result. However, that appears to not be the case. Combine that with an increasing number of their adult students having cash flow problems right now, their business outlook doesn't look great.
- Loughla 7y agoI need any amount of citation for that. For K-12, the 30-40 districts I'm affiliated with have gone to paper packets or online for those with access. The 40-50 colleges I work with regularly have gone all online for at least this semester and summer. I'm going to need you to cite something to back that up. It is opposite of everything I've seen so far.
- blihp 7y agohttps://www.edweek.org/ew/section/multimedia/map-coronavirus-and-school-closures.html?PageSpeed=noscript https://www.edweek.org/ew/section/multimedia/map-coronavirus... Just search on "schools shutting down for the rest of the year" and you'll find a bunch of sources. Of course it varies by state/district here in the U.S., but many are opting to shut down completely rather than attempting online instruction.
- tempsy 7y agoThe bootcamp model doesn’t seem like it would work well in a recession since new grads end up competing for any open positions with laid off people with more experience. I can’t imagine that Lambda would be able to place as many students now as they did before all else being equal and if they tried to sell their ISAs to a financing firm of course they are going to account for the new reality and request a much steeper discount than they did before. If you’re thinking of Lambda as a student then even if you don’t have to pay tuition you still have all your living costs to think about. Probably does not make sense do Lambda if you would otherwise be leaving a job and dig into savings and then enter a questionable job market.
- gnicholas 7y agoIn some ways, the ISA bootcamps would be in the most demand during a recession. Because you don't pay for tuition outright, you're only paying with your time/opportunity cost. For someone who's laid off, that just became free. And if you don't get hired for a year because the economy is frozen/thawing, then you don't have to pay anything during that period. If I were looking at bootcamps, I would put ISA-based ones at the top of my list. But I'd expect them to get more selective since they'll need to adjust their payback calculus given the economic uncertainty.
- PopeDotNinja 7y agoThe conventional wisdom used to be that many people would go back to school during a recession. I certainly did that in after getting laid off in the tail end of the dotcom bust. The timing of getting a degree during a normal recession cycle might work out simply because 1 or 2 years after you start school, you might be graduating when there's no longer a recession and hiring has picked up again. If you go to a 3 month bootcamp during a recession, you're likely to face a recession when finishing the program.
- thaumasiotes 7y agoAn interesting implication of this line of thought is that a lot of the value of getting a degree during a recession is not so much the degree as having something respectable to say you were doing with your time.
- MatthiasP 7y agoWill be interesting to see if bootcamp grads are more affected by the recession than your average CS college grad.
- instagary 7y agoI would come down to who has more experience in their resume. A lot of boot camp grads, unfortunately, cannot participate in internships because it's a continuation of classes (no breaks), but I don't think CS grads have a significant advantage assuming both prepared well and could get interviews.
- maximilianroos 7y ago> Today is a sad day, and people will react in different ways. However you react, those emotions are real, and they matter. This was one of the hardest decisions I’ve ever made in my life. It's unfortunate when CEOs neglect to mention the difficulties of those they fired — instead focusing on the the difficulties they faced in doing the firing
- joeberon 7y agoYeah honestly very gross and distasteful to shift the difficulties away from the employees laid off to the person who still has the job. I don't care how guilty they might feel, they still have a job and the people who are laid off don't, and at a very scary time of their lives. No way I will pity this CEO in any capacity
- adampk 7y agoWhat language do you believe should be used?
- ddebernardy 7y agoThat, and the fact that they're still advertising 12 job openings... https://lambdaschool.com/careers#jobs https://lambdaschool.com/careers#jobs
- earthtobishop 7y ago> However you react, those emotions are real, and they matter. This was one of the hardest decisions I’ve ever made in my life. > I want to publicly say thank you to everyone who has worked at Lambda for what you’ve contributed. I know you’ve given parts of who you are to Lambda, and to our students. You are part of our journey. You are the reason we are here. Thank you. He mentioned the difficulties of those who were fired by acknowledging that their emotions are real, and that they matter. And that this was an unfortunate decision he had to make. He also thanked them for all they have contributed . What else should he have said ?
- maximilianroos 7y ago
- ChefboyOG 7y agoI wonder how these mass layoffs are going to affect junior level hiring. Obviously, they're going to have an effect across all hiring, but the particular dynamic is interesting to me. I have friends who worked in investment banking in 2008, and several of them have talked about how the industry (or at least their perception of it) became more "diamond-shaped." By this they meant that past the initial hiring freezes, entry-level hiring eventually picked up as normal, but that senior level promotions took a while to pick back up. There was a glut of experienced VPs (more of a mid-level role in IB than in engineering) who were making lateral moves between banks—not competing for entry level roles—but none of them were moving up to higher positions.
- alextheparrot 7y agoIve already heard personally about internships getting cancelled from multiple sources, so there might be second-order effects as well where the junior engineers coming right out of college are less prepared.
- moneywoes 7y agoLittle off topic but do you reckon that IB offers high compensation and better job stability on aggregate vs tech? Especially longevity wise. I'm sure not every associate becomes a MD but neither does every L3 a L8.