Way down at the end of the page an "oh, by the way..." disclosure:
After the program graduates pay 15% of their income for 2 years if they are earning over $40,000, capped at $30,000 total paid back to Modern Labor.
There is also the implication that a potential starting salary is $91,476:
$91,476 The salary of an entry-level front-end developer (Source: PayScale, 2019)
Assuming that was somehow true...
%15 * $92K * 2yr - ($2K/mo * 5mo) = $17.6K total cost of tuition
Looking around, ~$11.4K is the average tuition for a coding school, so this proposition works out to be a rather high interest loan (that can't be paid off early):
The important difference being that with this program, you don't pay if it doesn't work out for you. The 17.6% APR is in case of a success - they just helped start your career. Seems well worth the greatly reduced risk!
If making $40k/year is "success". With your $6k payment on the $40k you made, your $34k is barely above the poverty line.
> Seems well worth the greatly reduced risk!
No, it doesn't. Just seems like a 300% repayment rate. I bet the number of software jobs starting under $40k is in the bottom 5%, maybe 1% of job listings. So, you're basically only mitigating risk if you can't find a job.
It's also a high-risk lending operation, and high-risk lending naturally comes with high interest rates. Maybe someone takes 6 months to find a job, now the interest rate is under 7%.
I think that tying your own financial reward to the financial success of your graduates is perfectly OK, perhaps even desirable.
> Looking around, ~$11.4K is the average tuition for a coding school, so this proposition works out to be a rather high interest loan (that can't be paid off early)
You are paying extra in the hoped-for successful case in return for paying less if the whole thing turns out to be a bust. Or, equivalently, you are paying a lot extra for a portion of the tuition (which is, in fact, a straight $20,000—the $30,000 maximum minus the $10,000 stipend) to be due over time after completion, repaid on an income contingent basis, and foregone in part or in whole if after-program income isn't at least $200K over two years.
Sure, but a loan you don't repay unless you get placed and make above a certain threshold. They're removing the risk for you and you pay for that once you're able.
I agree that the salary estimate is high, and I wouldn't hire a remote junior dev, but still; you're paying nothing up front and they're handing you $2k / month.
It's disingenuous to place this figure there without specifying the location. Even in places with high COL, 91k as an entry-level front end dev is unrealistic if they have no prior experience. And if this is assuming you'd be remote, that's even more ridiculous. 91k off the bat with 0 prior experience in the industry working from wherever you want sounds like a fantasy.
Out of interest, what would you say are the key weaknesses at your company that makes successfully hiring, training and managing juniors for remote roles impossible?
Can you remove people from the program midway through, if it seems like they're not doing well? If so, what are the rules around this?
In some ways this seems like a very selective program, since you pay people to do something whereas your competitors charge people. But selective programs would want to get the very best students — and here there's actually an adverse selection problem. That is, people who think they will be rock stars and get high-paying jobs will not want to enroll with you since they would expect the longer payback period (at their presumed high salary) would be less favorable than doing a typical program with a payback period that is half as long.
They really expect to have someone from zero coding to full stack in only 12 weeks? 3 months is barely enough to get started on modern front end, assuming you already have programming experience.
Either they have found some revolutionary new way of injecting data into the brain Matrix style, or the people coming out of that program won't be even close to ready and will probably have a mess in their heads.
Also 90K for an entry level remote position? I have 20 years of experience, where do I have to sign for that? I'd gladly take an entry level position with zero responsibilities for that kind of money.
I could easily see variants of this happening. For example, companies could fund the students and get to pick first.
I can think of at least 5 people I know that has the potential to become competent developers, but their problem is exactly what this solves: they already have jobs and mortgages.
Who is the target audience specifically? There are lots of organizations who work with state unemployment agencies around the country to try to place people with training, and then help find them jobs. This seems perfectly placed for that.
Assuming I could find 10 formerly convicted felons who live on unemployment/welfare and dropped out of high school and got them to apply to this program, would they get accepted? If "The most important thing we care about is evidence of grit" is true, I think these individuals should qualify.
I am surprised that nobody has raised the question of whether this is 15% of gross pay, pre-tax or 15% of net pay, post-witholding (well assuming W2 positions)? Those are very different things, especially in states like CA/NY where I imagine many candidates might end up being placed. In those contexts 15% of gross might be more like a 25-30% effective share of the developer's net income (?)
We will pay you to learn to code, then place you on projects for real clients. They will then have the option to hire you within 6 months. It's outsourcing cross training. (We'll have a few senior devs to mentor the teams, and we'll hire an exec or three involved in government contracting to give ourselves multiple options.)
Readit News
If making $40k/year is "success". With your $6k payment on the $40k you made, your $34k is barely above the poverty line.
> Seems well worth the greatly reduced risk!
No, it doesn't. Just seems like a 300% repayment rate. I bet the number of software jobs starting under $40k is in the bottom 5%, maybe 1% of job listings. So, you're basically only mitigating risk if you can't find a job.
I think that tying your own financial reward to the financial success of your graduates is perfectly OK, perhaps even desirable.
You are paying extra in the hoped-for successful case in return for paying less if the whole thing turns out to be a bust. Or, equivalently, you are paying a lot extra for a portion of the tuition (which is, in fact, a straight $20,000—the $30,000 maximum minus the $10,000 stipend) to be due over time after completion, repaid on an income contingent basis, and foregone in part or in whole if after-program income isn't at least $200K over two years.
I agree that the salary estimate is high, and I wouldn't hire a remote junior dev, but still; you're paying nothing up front and they're handing you $2k / month.
> $91,476 - The salary of an entry-level front-end developer
These two things should not be next to each other. It's exceptionally rare to get $90k a year remotely with no prior work experience.
In the metro Boston area, fresh college grads are getting $100K+bonus typically, with upside from there. I think $91K is not at all unrealistic.
Out of interest, what would you say are the key weaknesses at your company that makes successfully hiring, training and managing juniors for remote roles impossible?
In some ways this seems like a very selective program, since you pay people to do something whereas your competitors charge people. But selective programs would want to get the very best students — and here there's actually an adverse selection problem. That is, people who think they will be rock stars and get high-paying jobs will not want to enroll with you since they would expect the longer payback period (at their presumed high salary) would be less favorable than doing a typical program with a payback period that is half as long.
Either they have found some revolutionary new way of injecting data into the brain Matrix style, or the people coming out of that program won't be even close to ready and will probably have a mess in their heads.
Also 90K for an entry level remote position? I have 20 years of experience, where do I have to sign for that? I'd gladly take an entry level position with zero responsibilities for that kind of money.
I could easily see variants of this happening. For example, companies could fund the students and get to pick first.
I can think of at least 5 people I know that has the potential to become competent developers, but their problem is exactly what this solves: they already have jobs and mortgages.
Assuming I could find 10 formerly convicted felons who live on unemployment/welfare and dropped out of high school and got them to apply to this program, would they get accepted? If "The most important thing we care about is evidence of grit" is true, I think these individuals should qualify.
We will pay you to learn to code, then place you on projects for real clients. They will then have the option to hire you within 6 months. It's outsourcing cross training. (We'll have a few senior devs to mentor the teams, and we'll hire an exec or three involved in government contracting to give ourselves multiple options.)
Who wants to fund? laughs