I am open to consulting on projects relating to Income Share Agreements and the implementation of alternate education financing policy.
I am available at a rate of $200 per hour to consult on ISA projects. This rate is negotiable and I am also available to be held on retainer for a long-term consulting position. In order to inquire about my services, email me at email@example.com and mention the word “Consulting” in the subject line.
What are Income Share Agreements?
Income Share Agreements, or ISAs, allow a student to raise the money they need to finance their education in exchange for a percentage of their income after they graduate. The student is only required to make payments when they earn over a certain amount per year — referred to as the minimum income threshold — and payments are capped at a certain amount. This means that students who are not successful do not have to pay for their education, and students who are very successful do not pay a disproportionate amount back to their school or investor. ISAs are a revolutionary new financing mechanism that have been successfully implemented in bootcamps such as Lambda School, colleges such as Purdue University, and local workforce boards such as the San Diego Workforce Partnership.
ISAs have a number of benefits for both students, and institutions. ISAs also have the capability to reduce a number of the impacts of the student debt crisis, as it would reduce dependence on debt. A few of the main benefits of ISAs include:
Increasing access to education. ISAs — unlike debt — are focused on evaluating the potential of a student, rather than their previous earnings history and credit background. Therefore, ISAs have the potential to help those who are traditionally unable to access education financing raise the money they need. ISAs also allow people who cannot find a co-signatory to raise the money they need to pursue their dream education — around 90 percent of private loans require a co-signatory, for context. Further, ISAs can also be used as an alternative for people who are unwilling to take on debt, based on the fiscal and emotional impacts it can have on a young person’s life.
Aligning incentives with students and schools. Because the institution will only earn a return if the student earns over a certain amount after graduation, they have an economic incentive to provide students with a higher quality education. This has resulted in a direct improvement in educational offerings by companies leveraging ISAs, because schools with unsuccessful students cannot function economically if they offer ISAs to students.
Moving the risk from the student to the institution. Students in an ISA no longer have to worry about the risk associated with pursuing further education. If the student fails, they owe nothing to the institution. In addition to incentivizing schools to offer a higher quality education, this also allows schools to signal their commitment to investing in the success of their students. The student assumes a lesser amount of risk than they would with a loan because if they fail, they don’t need to pay anything back. This can be a major selling point for more progressive programs such as alternate bootcamps which would benefit greatly from the image of being economically invested in their students, and the confidence it would yield in their services.
ISAs have the ability to completely change the way we finance education. ISAs eliminate the need for a strong financial history to pursue further education — people are evaluated based on their skill through an ISA. ISAs, in addition to the aforementioned benefits, can also generate a favorable return if implemented correctly. This can allow for sustainable learning funds to be created, as have been developed by bodies like the San Diego Workforce Partnership, thus allowing schools and other bodies to further increase access to their educational offerings.