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> ... then immediately monetize that ISAs by selling them with a discount to a 3rd party Is that really true? If so, this is shocking to me. If LS sells the IS
by TheRealDunkirk 6y ago
> ... then immediately monetize that ISAs by selling them with a discount to a 3rd party
Is that really true? If so, this is shocking to me. If LS sells the ISA, then, obviously, they are no longer "aligned" with their students' success. What's the point of their "revolutionary" arrangement then? This makes perfect sense out of the jumble of anecdotes I'm reading.
From further below: https://www.theverge.com/2020/2/12/21135134/lambda-school-students-edly-isa-debt-swapping-partnership-shares-investors https://www.theverge.com/2020/2/12/21135134/lambda-school-st.... In other words, yes, this is what's happening, and it's a disaster, for exactly the stated reason.
- blntechie 6y agoIt is known that they package and sell the ISAs like other credit products. But regarding their alignment with student success, it’s to their benefit that these ISAs realizes i.e. students succeed as the ISA quality determine how much they can sell them for.
- TheRealDunkirk 6y agoBut that coupling is much looser, and lagging, than keeping those contracts in-house.
- NationalPark 6y agoAssuming you are planning for long term success, of course. If you felt like the business wasn't going to work and you wanted to squeeze as much cashflow out of it as possible before the music stops, it would also look like this. I'd also expect ballooning teacher-student ratios and big weed-out bars that lock students into the ISAs but save money by kicking them out halfway. Edit: Another commenter pointed out that if you expect a good number of the ISAs to end up in litigation with students who feel mislead, it also makes sense to dump them at a discount on someone else, so your name doesn't show up immediately on the lawsuits.