u/ludofourrage wrote (the comment Michael replied to):
you're forgetting the fixed costs: IT, HR, Curriculum Dev... Marketing alone can be significant (cost of acquisition). 2U is spending 40% of its revenue on marketing as per their last quarterly report.
u/michaelnovati replied · ★ FEATURED
Yeah good points. So IT/HR I'm factoring into the 2X multiple.
Curriculum dev is R&D. If a bootcamp was failing it could fire the entirely team and keep functioning because of the unit economics of a cohort.
Marketing and CAC for Codesmith is different than others, but they basically just have an Admissions person and they run about 10 to 20 public sessions a week (often with leaders or instructors running them, so the cost is mostly salaries accounting for in the unit economics above).