Lambda School raises $30 million in quest to tackle student debt
Illustration: Rebecca Zisser/Axios
Lambda School, a San Ramon, Calif.-based coding school, raised $30 million in Series B funding at a $150 million post-money valuation. Bedrock Capital led, and was joined by Vy Capital, GGV Capital, Google Ventures, Y Combinator and Sound Ventures.
Why it matters: Because Americans owe around $1.5 trillion in student debt, significantly more than they owe on credit cars or for vehicles, and Lambda is helping to pioneer a model that eschews tuition in favor of repayments via a percentage of future salary.
- Lambda expects to train 3,000 students this year, just opened shop in Europe and CEO Austen Allred tells Axios that it plans Canada expansion either in Q1 or Q2 of this year. It also plans to soon expand its curriculum into cybersecurity, and next into medical services like nursing (which may include the purchase and reformatting of an existing school).
The bottom line: "It is an approach meant to treat students as investments rather than cash cows — a fundamental shift that could finally lift the crippling debt load we routinely push onto students. But it also comes with a peculiar kind of danger: By seeking safe investments, programs like this could cast aside the strides made to expand educational opportunities to higher-risk students and reduce the appeal of educations that focus on noble, but lower compensated, professions," writes Andrew Ross Sorkin in the New York Times.
Go deeper: The good news about student loans