In the United States, we currently have a crisis with higher education. At the same time as the demand for higher-level skills has never been more acute, the cost of attaining these skills through higher education has never been more expensive. In the next few years, the first universities will reach a $100K a year price tag. Today, over 45M Americans are burdened with college debt, amounting to a whopping $1.5 trillion dollars.
Cost is likely a major reason why Americans are becoming disillusioned with higher education. A recent Gallup poll found that only 41% of young adults (18–29) believe that higher education is very important. This is down 33% percentage points, from 74%, just six years ago.
Yet rightly or wrongly, getting a college degree still matters for most Americans. It matters a lot. Men with bachelor’s degrees earn approximately $900K more in median lifetime earnings than high school graduates while women earn $630K more. The unemployment rate of those with a college degree is ~30% lower than those without it. And the trend towards jobs requiring more and more advanced skills is only accelerating. This is true even in manufacturing where automation has already shifted the profile of who they hire. In the next three years for the first time, American Manufacturers will employ more individuals with a college degree than without one.
At GSV we are looking for solutions to these challenges. We are looking for new educational models that both decrease costs but also improve quality. And it is for this reason that we are so thrilled to be investing in Outlier. With Outlier, we believe we can do both.
Outlier was founded by Aaron Rasmussen, who previously founded MasterClass. It offers cinema-quality courses from renowned professors with transferable credit from the University of Pittsburgh. The courses focus on the top general education requirements for universities, starting with Calculus and Psychology (check out this trailer!). And the professor line-up is just amazing — it includes Daniel Lerner whose course on happiness is NYU’s most popular elective, Paul Bloom, the leading expert in moral psychology from Yale University, and John Urshel, former NFL lineman and PhD candidate in applied mathematics at MIT. The courses all include one on one tutoring, AI proctored assessments, and student community. The courses are $400, which is a fraction of the cost of traditional higher education courses.
We were taken with Aaron’s vision and unique background in film and technology, the quality of the courses, the strength of his university partnerships, and also by Outlier’s early results with their students. Students achieved a C grade or better at the same rate as those in comparable courses within traditional classrooms.