u/Practical-Ad3920 wrote (the comment Michael replied to):
I don’t understand how they could be loosing money. My Hack Reactor cohort had 60-80 people. That’s $1.4 million for 19 weeks. By far the largest expense is going to be instructor salaries. At any given time you have 3 instructors so that’s roughly $150k for instructors. Double t
u/michaelnovati replied · · edited
I can go into more details, but if you pay via loan or ISA the program has complex agreements with the loan providers to receive portions of the loan/ISA upfront themselves. But all of this is contingent on how those providers are predicting outcomes and the math for how much interest they'll make all said and done. If those providers start seeing worse outcomes then they expected they might pull financing or change it in a way where the bootcamp won't get enough money upfront to be able to run the program anymore. They would have to choose between other forms of debt, in hopes that the outcomes are better than expected, or give up and take the loss.
It's a lot more complicated than it seems though.