The State of Coding Bootcamps in 2018

As the CEO of a coding bootcamp, Actualize, I'd like to share an insider's perspective on the coding school industry, and specifically how I see it playing out over the course of 2018. Obviously, I am subject to biases: I am partial to coding bootcamps, and I am particularly partial to Actualize. That being said, I feel that it's important for the people who run coding schools to speak their mind and not simply watch from the sidelines as we are discussed and debated by media and others who are on the outside looking in. We should be transparent and upfront about our past success, vision for the future, and - yes - challenges to overcome.

While coding bootcamps existed in some form already back in the '90s, the first modern bootcamp - as coding bootcamps look today - was The Starter League in Chicago (since acquired by Fullstack Academy) in 2011. Since then, there has been a proliferation of such programs, and there are now more than 300 coding schools worldwide. According to Course Report, over 20,000 people graduated from coding bootcamps in 2017 alone.

However, not everything about the coding bootcamp industry has been so rosy. In 2017, two of the largest coding bootcamps, Dev Bootcamp and The Iron Yard, abruptly shut their doors due to financial woes. This sparked a lot of speculation about the future of coding bootcamps, with some announcing that this whole industry is a flash in the pan. Yet, other schools have continued to expand.

Then, there is the issue of job placement. According to another study by Course Report, 80% of coding bootcamp graduates have successfully transitioned to jobs requiring the technical skills they learned at their coding school. Yet, many bootcamps don't report their own statistics at all, while others tout seemingly impossible numbers like 99% job placement. Then, one of the most respected coding bootcamps - Flatiron School - got slammed with a $375,000 fine by the New York Attorney General for inflated reports about its job outcomes. They were advertising a 98% success rate when truly only 58% of their graduates actually landed full-time paid tech jobs.

Various initiatives, such as the Council on Integrity in Results Reporting - CIRR - have been established to make a transparent and systemized format for coding schools to report their student outcomes. Yet, CIRR is an initiative created and run by the coding bootcamps themselves, in addition to their student lenders and others with a stake in the success of the industry. It's a form of self-regulation - which I believe is well-meaning - but I'm deeply skeptical about self-regulation in general. To me, regulation needs to originate from objective outsiders to be effective and trustworthy.

So where is the coding bootcamp industry headed?

Too big to not fail

One of the most fundamental aspects of economics are the laws of supply and demand. I'm no economist, but it's pretty clear that coding bootcamps can only enroll as many students as there are people willing to join.

When the modern coding bootcamps sprouted up in 2012, people flocked to them in droves. I know that there was at least one point in time where Dev Bootcamp's campus in San Francisco started a new cohort once every three weeks, yet had a waiting list of a full year in order to sign up for a future cohort. The popularity of coding bootcamps was palpable, and others joined in, while some continued to grow and grow, spreading to new cities and opening new locations at an extremely fast clip.

In 2012 through 2016, it was simply unknown how large the market for coding bootcamps could be. Since the limits had not yet been reached, coding bootcamps proliferated and ballooned, enrolling more and more students, because - why not?

However, economics also dictates that there is nothing in the world that has infinite demand. In 2017, the coding bootcamp industry did begin to reach the limits of the market, leading to market corrections. We, at Actualize, who were on a continued growth trajectory, found ourselves going from a profitable company to one that was losing money, because we were growing our infrastructure while not earning enough tuition revenue to sustain that growth. As such, we actually had to scale down some of our operations, which involved some considerable pain.

Other coding bootcamps, such as Dev Bootcamp and The Iron Yard in particular, kept up their steady pace of growth until it was too late - they had run out of money and abruptly shut down.

Unfortunately, I believe that some of the other larger coding bootcamps will also shut down in 2018. Others - the smarter ones - will radically change their strategy to survive.

Recent reports signal that General Assembly - who is perhaps the largest player in this space - is struggling. Already in 22 cities and having raised $120 million, this mammoth bootcamp has certainly gained a lot of traction. But how much of that $120 million is left?

While the market for people looking to learn coding will certainly grow, that growth may take time - it's not exponential. There are other major coding bootcamps that, like General Assembly, continue to grow rapidly, and adopt what I call the "world domination strategy" by constantly opening new locations and blasting out tons of paid marketing. However, I am very skeptical that they will be able to keep it up. Other coding bootcamps that seem to employ this strategy include Coding Dojo, Galvanize, and Tech Talent South.

Who owns your coding bootcamp?

One commonly overlooked factor that I see as determining the ultimate fate of a coding bootcamp is who owns it. A coding school can be owned by one of two entities:

1. An entity who sees the school as a means to make money.
2. An entity who is passionate about teaching people to code.

While Dev Bootcamp was founded by passionate coders, it was eventually sold to Kaplan, a private venture company who exists to make money for its stakeholders. They are motivated primarily by whether they can make enough money quickly enough by each particular venture they run. Since there was no quick financial fix for Dev Bootcamp, they closed it to avoid further losses. This isn't a knock against Kaplan. Their job is to make money. If they wouldn't have closed Dev Bootcamp, they would have been doing a disservice to their stakeholders.

Now, Actualize also went through a period of financial losses. But since Actualize is owned by someone (that would be me) who is a coder/educator who wants nothing more in his career than to build the world's best software development educational institution - we figured a way to make it work. We're back to being profitable, and while it took painful steps to get there, and I took on a personal financial burden that most others would not, we made it work because building Actualize is our most deep and meaningful work.

Other coding bootcamps that seem to be run by similarly passionate people include Turing in Denver (which is actually a non-profit), Sabio in Los Angeles, and Nashville Software School.

Program quality is also a natural outgrowth of the school ownership. I know of some unfortunate cases in which students had awful experiences at their coding bootcamps. These almost always occur in the bootcamps that are simply out to make a profit. In one recent example, half of one entire cohort of students did not return for the second day of class since they saw on day one that the quality was subpar. (To be clear: The negative stories that I am aware of did not take place at any of the bootcamps that I name in this post.)

Student outcomes

The coding bootcamp industry's biggest boon has now become one of its biggest challenges.

Just as supply and demand applies to the market of people who wish to attend a coding school, supply and demand also applies to the market of employers who will hire them. When modern coding bootcamps first emerged in 2012 and 2013, there were relatively few graduates compared to the massive need for entry-level software developers. If you smelled like you could code, you'd land a software engineering job somewhat easily.

To be sure, there still is a tremendous need for software engineers, and that need continues to grow. According to the Bureau of Labor Statistics, software development is one of the fastest-growing occupations, and according to many, it doesn't seem like we'll come close to fulfilling that need anytime soon.

Yet, the market for entry-level software engineers now seems to be as competitive as other entry-level white collar jobs. It's a great field to be in, and once you get that first bit of experience, the demand for you skyrockets, but simply knowing how to code - and even being great at it - doesn't automatically land you a job when you're first starting out.

That's not a problem. That's actually quite normal - and is the case for most industries in general. The problem we have on our hands is that since back in 2012 and 2013, simply knowing how to code was enough to land a job without effort, the coding bootcamps really, really hyped up their job-placement rates, with many touting that 99% of their grads landed six-figure positions within 3 months.

That hype may have been true back then, but it's not true anymore, and we're now living in the shadow of that hype. Prospective students still believe the old hype and demand that the coding bootcamps deliver on it. This is exactly what led to Flatiron School to feel pressured to continue to claim a 98% job-placement rate even though it wasn't quite true.

Fewer and fewer coding bootcamps are now publicly advertising their job-placement rates, and the ones that do are reporting smaller numbers than they used to in the past.

But this is not a problem. This is normal. The gold-rush-style success of coding bootcamp grads from 2012 and 2013 is what was not normal. The problem is that coding bootcamps feel compelled to stretch like crazy to still deliver 2012 results because of the old hype.

Two skill sets

Coding bootcamps need to adjust to the new economic reality, and should realize the following axiom: Having the skills to code and the skills to get a job are two completely independent skill sets.

Someone who knows how to be an accountant doesn't automatically land an accounting job, right? After people graduate from accounting school and get their CPA, they need to apply to jobs, network with people, submit resumes, and undergo interviews in order to actually land their first job.

The same applies to with newly-minted software developers, whether they are CS graduates or bootcamp graduates. Just knowing how to code alone doesn't make jobs come to you.

I graduated with my Masters in Computer Science, and even earned a special academic award along the way, but I still had to hustle to land a simple, low-paid web development internship to get my career started. That's the way of the world.

So, if coding bootcamps are in the game of helping their graduates land jobs - and I believe that they should be - they need to do two things:

1. Be upfront with prospective students that learning to code alone isn't going to automatically land them a job.
2. Train and work with graduates on the unique skill set of getting a job.

In the past year, Actualize has increasingly increased what we call our "job hacking" curriculum, and we train our students from day one of class on how to land a job as well as how to learn to code, and we place equal emphasis on both skill sets.

The coding bootcamps that still report extremely high job-placement rates do so by means of an asterisk. That is, they say: "96% of our graduates landed jobs within 6 months *asterisk*" - and when you follow that asterisk to the fine lines on the bottom of the document, it says, "This calculation of 96% only includes those graduates who fulfilled all of our job-hunting recommendations."

But we don't need to be so sneaky! Instead, we should be transparent that we're really good at teaching people to code, but that people who want to attend a coding bootcamp should recognize that they also need to engage in the hustle of the job hunt to actually land a job. The school can then also focus on providing excellent, personalized guidance to each graduate on how to actually land a job. But again, it's a completely different skill set than coding.

I'm very optimistic about the job prospects of coding bootcamp grads. It just takes work on both the part of the school and the student to get there!

Online education

Being an educator, I've historically been very skeptical of coding bootcamps taking place online. Until now.

Online education makes a ton of sense in theory, as it yields huge advantages. With online learning, you can learn anything from anywhere, and often at your own pace. How amazing is that?

However, I've felt that the nature of coding bootcamps doesn't really jive with online education. To learn so much in such a short time, as is the case with intensive coding bootcamps, you really need to be immersed and be within a support structure that prods you to continue to learn and push you to your limits. There was an interesting opinion piece in Quartz that highlighted these issues well.

As motivated as people might be to learn to code, it's really, really difficult to achieve that goal when they're studying at their own pace.

The two biggest players in the online coding bootcamp space are Thinkful and Bloc.io. For the longest time, they touted the fact that their program was self-paced, but I never saw this working for most people. More recently, it seems that Thinkful has a new program that is not self-paced, and that they're adding some in-person components as well. However, being that this is still not quite immersive, I have trouble seeing this becoming a smashing success.

My naysaying of online coding bootcamps changed when it occurred to us that if we can find a solid video-conferencing platform - and I mean solid - that it doesn't have any lag or technical issues, that we can conduct a live class over video conferencing that is identical to our in-person course. After much experimentation, we successfully launched our Online Live course (using software called Zoom) - which to my knowledge, is the only online coding bootcamp that is 100% live. That is, the instruction is live, the exercises are all done live, and every student can see each other and the instructor throughout.

I believe that other coding bootcamps will follow this model. And I'm sure that I'll receive comments that others are doing this, or even beat us to it - but that would be a good thing, because this is the direction that I hope and believe the online coding bootcamp world will take.

Universities

One cannot discuss coding bootcamps without talking about their counterpart: Universities.

The most glaring flaw of Computer Science programs at universities is that the curriculum generally contains only theory and lacks the real-world application. I have a Masters in CS, so I know this first-hand. I had to teach myself the real-world skills after I had graduated to land my first software engineering internship.

The other major problem with universities is that they're slow to change. They simply cannot keep up with the latest technology trends, nor do they really care. They're run by academics who basically care about... academics.

There's a lot of talk about coding bootcamps not providing enough computer science theory, and that coding bootcamp graduates may have practical skills but are limited by their lack of deep understanding. Thus, various bootcamps have been adding theoretical CS components to their curricula.

Again, having seen both sides, I can testify that in the vast majority of software development roles, this "deep, theoretical" knowledge isn't necessary to fulfill one's job, and any decent developer can pick up whatever knowledge is needed. CS isn't as deep and arcane as people with CS degrees would like to have you believe.

Since certain companies include CS questions in their hiring interviews, I wrote a practical CS book that any bootcamp grad can understand. I will not claim that the book is a replacement for a four-year degree, and I will also admit that there can be value in a four-year degree, but I believe that for many, those four years can be better spent at a bootcamp plus three-and-a-half years of professional engineering experience.

A new coding bootcamp model has arisen recently in which universities actually run their own coding bootcamps. Interestingly, no college credit is earned from these programs.

It's difficult to escape the irony: Universities are hosting coding bootcamps in recognition that their own CS programs are deficient.

I don't have an issue per se with universities running coding bootcamps. However, my experience is that in most cases, the people running these bootcamps don't actually know what they're doing. If the university can't run its regular educational programs well, why would they run a coding bootcamp well? The truth is that many of these bootcamps are actually run by outside providers who are big-business people who know very little about software development or education. And they're trying to scale these programs before getting the quality right. I know that I'm being harsh, but I've heard horror stories firsthand.

Diversity and financing

Many coding bootcamps (including Actualize) are huge proponents of making the software engineering workforce more diverse and getting more women and minorities into the field. According to Course Report, 36% of coding bootcamp students are women compared to roughly 18% when it comes to CS majors. So it seems that we're making some progress in this regard, which is exciting.

However, one of the trickiest challenges of attending a coding bootcamp is paying for its tuition. While coding bootcamps cost less than going to college, they're still in the neighborhood of $10,000 or more, and people from certain socioeconomic sectors find coding bootcamps inaccessible. And that's an unfortunate irony: The people who need coding bootcamps the most are those who cannot afford to attend one.

Various lenders, such as Skills Fund and Climb Credit, have stepped up to lend money to students of coding schools, but there's often a catch, such as the fact that a bad credit score can result in being denied funding. How many people are there that live below the poverty level but have great credit?

Other bootcamps - most famously, App Academy - only charge tuition once their graduates land a tech job. Usually, this takes the form of an Income Sharing Agreement (ISA), where the school takes a certain percentage of the graduate's first year of salary. From a theoretical perspective, I love this model. Not just does it allow for people to enter a coding bootcamp without requiring the tuition up front, but it shows how much the school stands behind the goal of their students landing jobs. The school only succeeds once the student does.

I would love to see this model grow, but I do have concerns about its sustainability. Specifically, this is very difficult to pull off from a cash flow perspective, unless the school already has lots of cash in the bank. Also, ensuring that students actually pay up once they have a job sounds painful. I will be transparent, though, that I have not yet done a deep dive into exploring this world, but it's something that I will continue to explore.

I do know that there are some outside providers who are starting to help coding bootcamps offer ISAs. I think that 2018 will bring more progress in this area.

Government

There have been various attempts at government helping students attend coding bootcamps. One attempt from the Obama administration was Project Equip, in which students could actually apply for federal aid even though the coding bootcamps are not accredited the same way colleges and universities are.

I don't think that we're going to see much progress in this area in 2018. There's been a lot of debate as to whether it's a good thing, but to me, it all depends on the exact implementation. I think that there must be some way for the government to get involved that will lead to positive outcomes, but I truthfully haven't given it a tremendous amount of thought, since I anyway don't think that we'll see such progress anytime soon.

Selectivity

One of the most interesting (and possibly most successful) business models in the coding bootcamp industry is the concept of accepting only a very small percentage (like 3% to 5%) of applicants. Essentially, these bootcamps only accept students who either:

1. Are geniuses when it comes to computer programming.
2. Already actually know how to code to a considerable degree.

This creates a self-fulfilling prophecy of success. That is, the graduates from these coding schools graduate with unusually good skills (since they came in with unusually good skills). This leads to the following cycle:

1. The people come in with good skills.
2. The people come out with good skills.
3. The people get hired more quickly than the average bootcamp grad, since they have better skills.
4. The reputation of the bootcamp soars.
5. Everyone and their grandmother applies to the bootcamp.
6. There are so many people to choose from, that it's easy to find people who already have good skills, which then reinforces this cycle.

Some of the more famous bootcamps that operate like this include Hack Reactor, App Academy, Codesmith, and Fullstack Academy.

I think that this makes for a solid business model, and I don't have a problem with it per se - but it is a particular niche. That being said, I'm seeing a trend that even graduates of these selective bootcamps aren't having as easy a time landing jobs as they used to. Again, like all other regular human beings - they need to engage with the actual job hunt - resumes, interviews, and all. Having great skills alone is simply not sufficient.

At Actualize, we are selective when it comes to choosing our students, but only in regards to how motivated they are to learn to code. For example, we try to only accept people who are looking to become a software developer for their career. But we're not very selective when it comes to actual skill. Coming from an education background, our specialty is being able to train people of varying skill levels. While we're not perfect at this (yet), it's something we work on continuously and consider one of our most important missions.

Whew!

I guess I had a lot to say.

To be clear: I'm extremely excited about 2018. It's a year in which our industry will continue to refine itself as coding schools continue to improve in both quality and quantity. There may be some pain, as markets will continue to self-correct, but we'll make progress as a whole. Thousands of additional coding bootcamp graduates will successfully transition to careers in tech, and they will be empowered to live more rewarding lives. And I'm excited to play a part in it!

Finally: The odds are that someone will disagree with something I've said here. That's ok. Please join the conversation by leaving a comment below. I know I've stirred up the pot a little bit, but that's what our industry needs. So the more voices, the better.