The future of the coding bootcamp industry?-?from Springboard, Le Wagon and Career?Karma

Parul Gupta is the Co-founder and President of Springboard, the US-based provider of online, project-based, mentor-led courses to help people break into fast-growing careers. To date, Springboard has enrolled >22k students across data, design, coding and cybersecurity.

Boris Paillard is the Co-founder and CEO of Le Wagon, the Paris-based bootcamp founded in 2013. Le Wagon has taught Web Development and Data Science in 40 cities and 25 countries, and has helped >10k graduates kick-start their tech career, upskill in their job, or launch their own startup.

Ruben Harris is the Co-founder and CEO of Career Karma, the online platform enabling individuals to find a job training program online through a directory of 9,000 bootcamps and trade schools. By offering free coaching and peer mentorship, Career Karma has grown to over 150,000 members from every background and profession.

Here is what founders will get out of this summary of our conversation with Ruben, Boris and Parul.

• The key personas, motivations and pain-points of bootcamp learners
• The product strategy you need to differentiate yourself in this hyper-competitive market
• The role of employer and university partnerships in growing bootcamps
• The top market opportunities for scaling to ￡100m+ revenue
• The emerging trends that will shape the future of the bootcamp industry

How do you segment the market?

RH: when we think about people coming through the funnel, there are three broad categories:

• The curious explorer — these people don’t know what’s going on in the tech world, but they know something is happening, and want to learn more. They are completely clueless, but passionate and interested in making a change
• The informed explorer — they know they’re interested in coding/data science, but need help in thinking through the details. For example, picking between different languages, specialities and roles
• The ready applicant — those who know what they want to do, and are looking to narrow down their options to a few schools. They want guidance from experienced individuals who can help them along the way. They usually know what they want, but want validation for their decision

PG: I completely agree with segmenting by learner intent and where they are in the journey of considering coding bootcamps. I’d also throw in a few other considerations:

• Part-time vs. full-time
• Asynchronous vs. live learning
• Online vs. offline

Students tend to have preferences across these modalities based on their persona and life circumstances. Of course, Covid has moved a majority of offline education online, but it remains to be seen where preferences settle after the pandemic.

BP: We also see very similar personas, and segment our learners into:

• Recent graduates who are looking for a technology role. This can be further broken down to: a) ‘high-end’ grads from top schools who can get a high-paid job but require support to break into tech, and b) grads from other schools who choose bootcamps to get a bigger earnings delta
• Professionals who are unhappy with their current career and are considering bootcamps to quickly see what other options they have
• Freelancers who don’t have technical skills (e.g. designers) and want to offer new services to their clients such as web development

Finally, format is important. We’ve now moved all of our programmes online, but demand remained the same, and our NPS stayed above 80.

What do you believe is the single most important decision-making factor is for these segments of learners?

PG: The factors vary by user demographic and intent — if I were to pick one, it’s credibility/trust. This often comes from employment outcomes for bootcamps, and also from reviews. People want validation that this is the right choice, and so they’ll want to look at reviews, see outcomes reports, speak to alumni etc.

RH: I agree with this. The main difference between a bootcamp and a college is that bootcamps measure success predominantly on jobs. The top criteria for me is job outcomes. Also, affordability is a key consideration. Most people who are applying either don’t have tens of thousands of dollars ready to spend and/or have student loans. It’s not just ISAs, but also deferred tuition is growing to address this need.

BP: For me, every good bootcamp markets their job outcomes. We see that >20% of joiners for our bootcamp come in through word of mouth from their friends. Both reviews and job outcomes and really important.

The bootcamp industry has become hyper-competitive over the past decade. How do you differentiate through your product strategy and positioning?

BP: Over time, all bootcamps build key features like strong career services, a robust curriculum, employer network and so on. The way to differentiate is through your NPS and job outcomes for students. This comes down to teaching, and it’s hard to acquire and retain strong teachers. We do this by creating a community of freelance teachers and actively supporting them, including with training, software tools, and real-time analytics. In short, differentiation lies in your operational model and teacher quality.

PG: From the outside, it can be very hard to distinguish the features of different bootcamps. There are very low barriers to entry, but high barriers to scale. You can see this through the consolidation in the industry.

For us, there are two key differentiators: one-on-one mentoring and virtual internships. This enables us to deliver a better student experience and outcomes. For example, every single learner is matched with an expert mentor who’s a practitioner in their target industry. The mentor provides one-on-one tailored support every week including goal-setting, progress tracking and technical feedback. We have >1,000 mentors today, and there are not many in the bootcamp industry that do this. We’ve heard from students that the mentoring and virtual internships are leading reasons for why they choose Springboard.

Both mentoring and virtual internships are operationally very difficult to scale, and this is where you can differentiate. Ultimately, differentiation comes through process excellence.

Let’s go into detail on processes. What are the biggest mistakes other providers make when it comes to the student experience?

RH: We often see admissions messing up. We see students coming in with a particular school in mind, but they get put off by a poor admissions experience. Every learner wants to see that you care, and this is something you have to get right from the jump. We see some bootcamps failing to do this at scale as they rush the process and fail to provide high-touch personalised support.

BP: On the teaching side, I think it’s very important to ask yourself what is your pedagogical model. A lot of bootcamps hire great teachers on paper, but don’t provide the right training and infrastructure to deliver a high-quality learning experience. This leads to high turnover and poor outcomes.

PG: I agree with this, and when it comes to our mentor recruitment, it’s not enough to have technical expertise. We’re highly selective, and recruit only 1 in 10 applicants. We don’t just look at experience, but also passion for mentorship, and having the ability to clearly explain complex concepts to someone new.

On the admissions side, you have to think carefully about your students’ starting point. For example, a fresh college graduate with no experience in tech will have a very different starting point from an experienced professional in an adjacent field. To address this, we have a range of offerings, with advanced courses that have more selective criteria. We are selective in our application process so that we are setting up learners for success. We also have more basic courses that are open to much larger numbers of individuals, and also offer onramp courses for learners who can’t get into our more advanced courses. It’s really important to think about where your learner is, and failing to do so can be a common mistake.

What’s the best way to scale to ￡100m in revenue?

RH: If you zoom out and want to focus on the biggest problems, you need to focus on blue collar workers. There are 2bn blue collar workers, and most of them will need reskilling. Instead of going back to college, these workers are going to need specialised training programmes and that’s where bootcamps come in. According to McKinsey, we need to reskill 375m workers by 2030, and this kind of scale can only be addressed through online education. Southern New Hampshire University (SNHU) has done some very interesting things to show the impact of online education — they have >100k learners, mostly online, and recently acquired Kenzie Academy to get into more outcomes-focused accelerated learning.

PG: Our audacious goal is to transform 1 million lives by 2030. The path we’ve initially taken is B2C as this is the fastest way to get off the ground given low barriers to entry. However, paid acquisition becomes more expensive with scale. We see huge growth opportunity in other models, including both university and employer partnerships

Universities are becoming more open to partnering with providers like us to access new markets. This is a space we’re investing in actively. We now have 4 university partners, and are continuing to expand in this space. B2B is also super interesting, but it’s a crowded landscape with lots of different models from content libraries like Udemy and Lynda, to the more ‘bums on seats’ programmes that are higher-priced and more service-oriented. The large players like Coursera and Udacity are also expanding into this space.

BP: Our main vision is still to grow the B2C segment. For now, we are not operating in the US. Mathematically, if you continue to have a good operational model and relatively low marketing costs in your target regions, you can reach the 10k graduates per year required to reach 100m in revenue.

On the university side, we’ve done lots of partnerships. For example, we are launching a data science bootcamp with Imperial College in the UK. I think that everyone was excited by the Trilogy model, but if you look at Europe, regions like France don’t have many schools with a strong focus on continuing education so the white label or co-branded partnership model is difficult. B2B has some potential but the challenge here is that you have to create more bespoke programmes and tailored services, and this requires a big shift from being a pureplay B2C provider. We are increasing our content creation to shift towards the B2B play.

It’s interesting to see big differences in org structures for bootcamps. Are you more centralised or localised?

BP: Most of our teams are local, and we have just 10 global staff out of 150. We believe in having strong local models. This enables us to tailor programmes towards local needs, establish strong regional employer networks, and acquire local learners in a cost-effective way by generating strong interest through communities and word of mouth.

PG: Our biggest revenue engine today is the B2C market in North America. This is very centralised and works tightly together even across different verticals. We have different General Managers for different verticals, but lots of shared resources including sales and marketing. For new opportunities like university partnerships, where we are still targeting the US, we have semi-centralisation and shared resources. It makes sense to share resources here because of the synergies.

How much will the bootcamp market keep growing?

RH: We just shared a report on the State of the Bootcamp Market 2021. We saw that YoY student growth was 30%, and there were 44k graduates around the world. The average bootcamp tuition was $11.7k, and we estimate that bootcamps earned a total of $519m in 2020. We project bootcamps will enroll 64,432 students in 2021, based on the average rate of growth in enrollments since 2012. The key factors that will influence this growth are:

• Employment uncertainties and their impact on job security due to COVID-19.
• Bootcamps offering online learning.
• The employment-driven value proposition of bootcamps.

How long will it be before all this switches to being employer-funded? What are the blockers here?

RH: Guild Education has set the precedence for this with higher ed. I’ve seen providers like Revature increasingly do this for vocational learning. With employers like Amazon growing their technical academy, Google launching credentialing, and IBM doing more vocational learning — we’re going to see more of this. I can’t predict when this will go mainstream, but it’s already happening. Another company touching specifically on this is Learn In.

BP: We already have some employers paying for talent, but that’s predominantly been through reimbursement once a student has been placed. There are also other models in France like government funding, and another great example is Multiverse in the UK that works through employer funding. But going forwards, to get employers to pay for learning, you need to better integrate employers with your admissions process to get the right candidates in through the door and build the right pipeline

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