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Investing in a Coding-School Graduate Could Get You 13% a Year

  • Lambda presentation estimates 8.6% default on income-shares
  • Financing structure gains steam as student-loan crisis mounts
relates to Investing in a Coding-School Graduate Could Get You 13% a Year

For investors starved of yield, it was an appealing proposition: a potential 13% return. You just had to be willing to take a flier on the future earnings of 1,000 coders.

That was the payout being targeted late last year for a swath of income-sharing agreements tied to students and recent graduates of coding academy Lambda School, according to a presentation from an online lending platform that specializes in student-loan alternatives. The participants pay no tuition upfront but pledge to remunerate 17% of their incomes for 24 months after landing a job that pays more than $50,000 a year. Repayment is capped at $30,000.