Cathie Wood, once the largest shareholder in 2U with ARK Invest, is also a major crypto investor. Wood believes that Bitcoin could top $1M by 2030. With US government guardrails weakened in the coming months, it should be interesting to watch the crypto boom and what happens after that, not just in the economy, but in society. Schools like the Kellogg Institute at Notre Dame have written positively about the use of crypto, discussing the downsides as an afterthought. The Wharton school has been accepting crypto since 2021.
Showing posts with label 2U. Show all posts
Showing posts with label 2U. Show all posts
Saturday, December 21, 2024
Tech Investor Cathie Wood Bets Big on Crypto
Tuesday, December 17, 2024
Scam Artist or Just Failed CEO?
For eight years, this blog has been investigating greed and corruption in higher education at all levels, from predatory for-profit colleges and student loan servicers to elite university endowments. We have also highlighted the good people in higher education: those who promote transparency, accountability, value, justice, and empathy.
Over those years, we have gained a good number of friends and allies and received a small amount of negative feedback. When we did face staunch criticism, or in a few cases, threats, we had to consider the sources, who were always bad actors or those who worked for them. The bad actor, Christopher (Chip) Paucek, and his attorneys, have filed a federal litigation, suing this blog and its author for giving you, our valued readers, our opinion. Specifically, Paucek has taken exception to our characterization of him as a scam artist.
We stand by our opinion of Chip based on what we learned in more than five years of investigations of 2U, the company Paucek led for over 10 years. And we hope that more people will do their own investigations.
We took our first look at 2U in 2019. In time, we were not the only ones paying attention. Workers in social media presented an inside view of the inner workings of 2U, describing what they viewed as enrollment practices that were highly questionable. Student consumers stepped forward, saying they had been deceived by 2U. Shareholders came forward, presenting Chip’s own words, saying he had misled them. The Wall Street Journal published a number of investigative pieces about 2U and the Chronicle of Higher Education also published two articles. While none of these outlets mentioned Chip, he was the CEO at the time, and in our view was responsible.
By March 2022, Chip Paucek was still CEO of 2U, and was formally setting up the Pro Athlete Community, also known as PAC. There was nothing secret about this venture by this time. But it did seem to us questionable that a CEO of a large corporation would be formally setting up another for-profit organization while the one he was running was failing.
In 2024, Chip admitted in an interview that he should have left 2U in 2019, but he didn’t. Chip also admitted that without his staying at 2U during that five year period, he wouldn’t have been able to start PAC. Last June, while still being paid as a consultant to 2U, a company nearly bankrupt, he led a group of retired players to ring the bell at NASDAQ. No one in the mainstream media picked up on the hypocrisy of all that exuberance on Wall Street. But we did.
Chip’s lawsuit against us was a surprise on several levels. First, our statements were just our opinion–it’s not provable or disprovable. Second, it seems nonsensical to bother with a blog seen by only 25,000 people a month. Third, and most importantly, Chip Paucek’s track record in business could reasonably lead someone to believe he is, indeed, someone who says untrue things to his own benefit.
Our feeling is that this lawsuit is more than a man taking exception to being called out for his track record; it’s, in our view, an attempt to keep us from warning his next potential victims–the athletes, employees, and investors who will be the next to learn about his methods.
Many states (including New Jersey, where Chip filed suit) have a law to deal with situations in which someone uses the courts to squelch investigative journalism. Accordingly, we are pursuing an Anti-SLAPP (strategic lawsuits against public participation) counter suit, asking for his case to be dismissed, and for him to pay our legal fees and court costs.
On November 25th, David Halperin, an ally of ours for many years, let the public know that 2U is likely to be under investigation by the Federal Trade Commission and the California Attorney General. The company Chip left in 2023, but is still being paid by, as a special advisor. We are not surprised.
If Chip would grant us an interview, we’d like to know more.
Related links:
A Hidden Risk of Online Higher Education (Student Borrower Protection Center)
David Bernard v Climb Credit, University Accounting Services, Loan Science & 2U
2U Investors Reach $37 Million Settlement With Online Educator (Bloomberg Law)Letter from CFPB to Richard Cordray about 2U
The Long, Steep Fall of an Online Education Giant (Wall Street Journal)
That Fancy University Course? It Might Actually Come From an Education Company.
USC Pushed a $115,000 Online Degree. Graduates Got Low Salaries, Huge Debts. (Wall Street Journal)Wednesday, December 4, 2024
More Layoffs at 2U, the Online Program Manager for Elite Universities
2U, the parent company of edX, has announced more layoffs today. The layoffs were announced to staff and it's not known yet whether they will be publicly reported. It appears that many of the cuts will come from edX bootcamps which may be closing by June 2025.
2U filed for bankruptcy earlier this year and the bankruptcy was approved by the U.S. Bankruptcy Court for the Southern District of New York on September 9th. Mudrick Capital Management is currently involved in the turnaround plan.
According to David Halperin, the edtech company may also be the subject of investigations by the Federal Trade Commission and California Attorney General.
2U is the online program manager for a number of elite universities, including Harvard, Yale, MIT, and the University of California. Some of the programs have been the subject of public scorn by consumers who claim they were defrauded. HEI has been investigating 2U since 2019. The Wall Street Journal has also investigated 2U and written several critical stories.
edX promises career support to people who sign up for bootcamps. But what happens when the bootcamps close?
Related links:
FTC and California AG Have Been Investigating Online College Provider 2U (David Halperin)
Workers at 2U expect more layoffs in 2024
2U Collapse Puts Sallie Mae and SLABS Back on the Radar (Glen McGhee)
2U Suspended from NASDAQ. Help for USC and UNC Student Loan Debtors.
2U-edX crash exposes the latest wave of edugrift
Tuesday, September 17, 2024
Workers at 2U expect more layoffs in 2024
After successfully completing its recent bankruptcy proceedings, 2U workers expect another round of layoffs. 2U, with its subsidiary edX, is the online program manager for dozens of elite universities, like Harvard and Yale, who offer their brand names to sell online degrees and certificates. But two schools, the University of Southern California and Fordham, have distanced themselves from the company. 2U's new board chair of is Brian Napack, who served as an executive at John Wiley and McMillan, two other companies that have faced financial challenges.
Related links:
2U Collapse Puts Sallie Mae and SLABS Back on the Radar (Glen McGhee)
2U Suspended from NASDAQ. Help for USC and UNC Student Loan Debtors.
2U-edX crash exposes the latest wave of edugrift
Wednesday, August 7, 2024
2U Suspended from NASDAQ. Help for USC and UNC Student Loan Debtors.
2U (TWOU), the online program manager for a number of elite and brand name schools has been suspended from the NASDAQ today for regulatory non-compliance.
A number of law firms have also announced potential shareholder lawsuits as 2U attempts to reorganize.Their contention is that shareholders were misled by key executives of 2U.
If these legal contentions are true, the Securities and Exchange Commission has the power to fine and ban executives and former executives from taking part as senior executives with other publicly traded companies. There is a precedent for this. In 2018, the former CEO and CFO of ITT Tech (ESI), Kevin Modany and Daniel Fitzpatrick, accepted penalties.
Potential Relief from Fraud for Elite Online Degrees and Certificates
2U has operated as an online program manager for about 70 clients, mostly highly regarded universities, including Harvard University, Yale University, MIT, University of Pennsylvania, Columbia University, Georgia Tech, University of California, Berkeley, Pepperdine University, Rice University, University of North Carolina, and University of Texas. 2U made false claims about the relationship it had with corporate employers, leading consumers to believe that these brand name credentials would be a ticket to better work.
Students who used federal student loans for 2U's online graduate programs for the University of Southern California and the University of North Carolina may be eligible for debt forgiveness if they can prove that they were defrauded. We recommend contacting the Project on Predatory Student Lending for a potential remedy.
For those who were misled about elite certificates, we recommend contacting the Federal Trade Commission and your state attorney general. However, both options will not result in easy answers.
Related links:
2U Declares Chapter 11 Bankruptcy. Will Anyone Else Name All The Elite Universities That Were Complicit?2U-edX crash exposes the latest wave of edugrift (2023)
2U Virus Expands College Meltdown to Elite Universities (2019)
Saturday, August 3, 2024
Higher Education, Technology, and A Growing Social Anxiety
The Era We Are In
We are living in a
neoliberal/libertarian era filled with technological change, emotional and behavioral change, and social change. An era resulting in alienation (disconnection/isolation) for the working
class and anomie (lawlessness) among elites and those who serve them. We are simultaneously moving forward with technology and backward with human values and principles. Elites are reestablishing a more brutal world, hearkening back to previous centuries--a world the Higher Education Inquirer has been observing and documenting since 2016. No wonder folks of the working class and middle class are anxious.
Manufactured College Mania
For years, authorities such as the New York Federal Reserve expressed the notion (or perhaps myth) that higher education was an imperative for young folks. They said that the wealth premium for college graduates was a million dollars over the course of a lifetime--ignoring the fact that a large percentage of people who started college never graduated--and that tens of millions of consumers and their families were drowning in student loan debt.
2U, Guild Education, and a number of online robocolleges reflected the neoliberal promise of higher education and
online technology to improve social mobility. The mainstream media were largely complicit with these higher ed schemes.
2U brought advanced degrees and certificates to the masses, using brand names such as Harvard, MIT, Yale, USC, University of North Carolina, and the University of Texas to promote the expensive credentials that did not work for many consumers.
Guild
Education brought educational opportunities to folks at Walmart, Target, Macy's and other Fortune 500 companies who would be replacing their workers with robotics, AI, and other technologies. But the educational opportunities were for credentials from subprime online schools like Purdue University Global. Few workers took the bait.
As 2U files for bankruptcy, it leaves a number of debt holders holding the bag, including more than $500M to Wilmington Trust, and $30M to other vendors and clients, including Guild Education, and a number of elite universities. Guild Education is still alive, but like 2U, has had to fire a quarter of its workers, even downsizing its name to Guild, as investor money dries up. It continues to spend money on its image, as a Team USA sponsor.
The online robocolleges (including Liberty University, Grand Canyon University, University of Phoenix, Purdue University Global, and University of Arizona Global) brought adult education and hope to the masses, especially those who were underemployed. In many cases, it was false hope, as they also brought insurmountable student debt to American consumers. Billions and billions in debt that cannot be repaid, now considered toxic assets to the US government.
Along the way there have been important detractors in popular culture, especially on the right. Conservative radio celebrity Dave Ramsey, railed against irresponsible folks carrying lots of debt, including student loan debt. He was not wrong, but he did not implicate those who preyed on student consumers. On the left, the Debt Collective also railed against student loan debt, long before the right, but they were often ignored or marginalized.
Adapting to a Brutal System
The system works for elites and some of those who serve them, but not for others, even some of the middle class. Good jobs once at the end of the education pipeline have been replaced by 12-hour shifts, 60 hour work weeks, bullsh*t jobs, and gig work.
Working-class
Americans are living shorter lives, lives in some cases made worse not so much by lack of education, but by
the destruction of union jobs, and by social media, and other intended and unintended
consequences of technology and neoliberalism. Millions of folks, working class and some middle class, who have invested in higher education and have overwhelming debt and fading job prospects, feel like they have been lied to.
We also have lives made more sedentary and solitary by technology. Lives made more hectic and less tolerable. Inequality making lives too easy for those with privilege and lives too difficult for the working class to manage. Lives managed by having fewer relationships and fewer children. Many smartly choosing not to bring children into this new world. All of this manufactured by technology and human greed.
The College Dream is Over...for the Working Class
There are two competing messages about higher education: the first that college brings opportunity and wealth and the second, that higher education may bring debt and misery. The truth is, these different messages are meant for two groups: pushing brand name schools and student loans for the most ambitious middle class/working class and a lesser form of education for the struggling working class.
In 2020, Gary Roth said that the college dream was over. Yet the socially manufactured college mania continues, flooding the internet with ads for college and college loans, as social realities point to a future with fewer good and meaningful jobs even for those with degrees. Higher education will continue to work for some, but should every consumer, especially among the struggling working class, believe the message is for them?
Related links:
More than half of college grads are stuck in jobs that don't require degrees (msn.com)
AI-ROBOT CAPITALISTS WILL DESTROY THE HUMAN ECONOMY (Randall Collins)
Guild Education: Enablers of Anti-Union Corporations and Subprime College Programs
College Mania!: An Open Letter to the NY Fed (2019)
"Let's all pretend we couldn't see it coming": The US Working-Class Depression (2020)Thursday, July 25, 2024
2U Declares Chapter 11 Bankruptcy. Will Anyone Else Name All The Elite Universities That Were Complicit?
2U declared Chapter 11 bankruptcy today and the company is now valued at less than $5M. That's a small shadow of the $5.4B perceived value it had in mid-2018.
As a company that will be owned and operated by vulture capitalists (VCs), 2U (TWOU) and its subsidiary edX will fall below the radar. But that won't stop the company from ensnaring more students for overpriced "elite" and "brand name" degrees and certificates--as it tries to survive. In fact, it might make it easier. The visible economic market and its media won't care anymore.
Somehow, these VC firms will try to extract value from the bankruptcy deal. But how they do that is a mystery. C-suite executives have already gotten some of their bonuses, leaving little else for workers. Reducing labor costs (firing people) will be essential. Not paying their bills is another. Continuing to deceive consumers would be difficult to change. Even after the deal, 2U will still be laden with more than $400M in debt.
Since 2019, we have tried to expose 2U and its business practices, as well
as the role of elite university partners in enabling the sale of advanced degrees and
edtech certificates that led to few good jobs and lots of consumer debt. When they acquired edX from Harvard and MIT for $800M, we doubled down.
The Higher Education Inquirer has been the only outlet to name the elite schools that were complicit in this scheme that took money away from consumers just trying to get ahead. Not just USC, but Harvard and MIT, and Yale, and Cal Berkeley, and the University of North Carolina, and Syracuse, and Pepperdine, and many others. Check out the links below to learn more about how this higher ed scheme developed and collapsed. And how this is just the latest wave of edugrift.
Related links:
2U-edX crash exposes the latest wave of edugrift (2023)
2U Virus Expands College Meltdown to Elite Universities (2019)
Tuesday, June 18, 2024
Ahead of the Learned Herd: Why the Higher Education Inquirer Grows During the Endless College Meltdown (Dahn Shaulis and Glen McGhee)
The Higher Education Inquirer (HEI) continues to grow without financial support and without paying for advertising or SEO help. The reason is that HEI continues to provide useful information for folks who follow US higher education. We do it in the spirit of Upton Sinclair and others pejoratively known as the muckrakers. And we gladly take the label.
HEI has published a number of articles that provide value to higher ed workers (including adjuncts), future, present, and former students (including the tens of millions of student loan debtors), and other folks affiliated with the higher ed industry (including workers at edtech and financial companies). We called it the College Meltdown.
We
have examined a number of groupings in the industry (from community colleges and
for-profit schools to elite universities and everything in between) and
issues (to include student and worker protests, student loan debt, and
violence on campus). We highlight those who are trying to good, like David Halperin (Republic Report), Gary Stocker (College Viability), Mark Salisbury (TuitionFit), Helena Worthen (Power Despite Precarity), Theresa Sweet and Tarah Gramza (Sweet v Cardona), and Ann Bowers (Debt Collective).
HEI has also had the good fortune of getting outstanding contributions from Randall Collins, Bryan Alexander, Robert Kelchen, Phil Hill, Gary Roth, Bill Harrington, and others. Bryan Alexander's contributions have been extremely important in highlighting the existential threat of global climate change and the civil strife that accompanies it.
While honest reporting is important to us,
we do take sides, just as other outlets do (most others take the side of
big business and government). We are for the People, and we hunt for corruption that undermines
democracy. We have examined companies (like Guild, Maximus, and EducationDynamics) that few
others will bother to examine. We continue to follow subprime
for-profit colleges that have morphed into subprime state universities
(like Purdue Global and University of Arizona Global) and other bad actors in higher ed (like 2U and the University of Phoenix).
We value history, the real unvarnished history,
not the tales, myths and lies that have been repeated to children for
generations and used as indoctrination at all levels of society. And we value those who look honestly at the present and the future, those not trying to sell themselves or their hidden agendas.
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