Skip to content
ADVERTISEMENT
Sign In
  • Sections
    • News
    • Advice
    • The Review
  • Topics
    • Data
    • Diversity, Equity, & Inclusion
    • Finance & Operations
    • International
    • Leadership & Governance
    • Teaching & Learning
    • Scholarship & Research
    • Student Success
    • Technology
    • Transitions
    • The Workplace
  • Magazine
    • Current Issue
    • Special Issues
    • Podcast: College Matters from The Chronicle
  • Newsletters
  • Events
    • Virtual Events
    • Chronicle On-The-Road
    • Professional Development
  • Ask Chron
  • Store
    • Featured Products
    • Reports
    • Data
    • Collections
    • Back Issues
  • Jobs
    • Find a Job
    • Post a Job
    • Professional Development
    • Career Resources
    • Virtual Career Fair
  • More
  • Sections
    • News
    • Advice
    • The Review
  • Topics
    • Data
    • Diversity, Equity, & Inclusion
    • Finance & Operations
    • International
    • Leadership & Governance
    • Teaching & Learning
    • Scholarship & Research
    • Student Success
    • Technology
    • Transitions
    • The Workplace
  • Magazine
    • Current Issue
    • Special Issues
    • Podcast: College Matters from The Chronicle
  • Newsletters
  • Events
    • Virtual Events
    • Chronicle On-The-Road
    • Professional Development
  • Ask Chron
  • Store
    • Featured Products
    • Reports
    • Data
    • Collections
    • Back Issues
  • Jobs
    • Find a Job
    • Post a Job
    • Professional Development
    • Career Resources
    • Virtual Career Fair
    Upcoming Events:
    College Advising
    Serving Higher Ed
    Chronicle Festival 2025
Sign In
Technology

With New Promise by Udacity, Money-Back Guarantees Come to Online Courses

By Corinne Ruff January 13, 2016
Sebastian Thrun, chief executive of Udacity, says he “would recommend every college president to think about” his company’s new pledge that graduates of its four most marketable courses will earn a job in their field within six months of completing the program.
Sebastian Thrun, chief executive of Udacity, says he “would recommend every college president to think about” his company’s new pledge that graduates of its four most marketable courses will earn a job in their field within six months of completing the program.David Paul Morris, Bloomberg, Getty Images

Late-night infomercials aren’t the only venue where companies try to lure consumers with money-back guarantees. Now some upstart online-education providers are making the same promise.

Udacity, a Silicon Valley-backed provider of MOOCs, announced on Wednesday a new program that guarantees its graduates will land a job in their field within six months of completing the program — or their money back.

To continue reading for FREE, please sign in.

Sign In

Or subscribe now to read with unlimited access for as low as $10/month.

Don’t have an account? Sign up now.

A free account provides you access to a limited number of free articles each month, plus newsletters, job postings, salary data, and exclusive store discounts.

Sign Up

Late-night infomercials aren’t the only venue where companies try to lure consumers with money-back guarantees. Now some upstart online-education providers are making the same promise.

Udacity, a Silicon Valley-backed provider of MOOCs, announced on Wednesday a new program that guarantees its graduates will land a job in their field within six months of completing the program — or their money back.

But there are plenty of caveats.

The promise is being offered only to students who enroll in Udacity programs that teach the most marketable skills: machine-learning engineer, Android developer, iOS developer, and senior web developer. And students must complete the courses, something a vast majority of the four million students enrolled by Udacity do not accomplish.

Students who want the money-back guarantee must also pay an extra $100 a month for that peace of mind, remitting a total of $299 a month until they finish the course. For most students, it takes six to eight months of working 10 hours a week to complete a program, said Udacity’s chief executive, Sebastian Thrun, in an interview this week.

There is also no guaranteed benchmark salary, although Mr. Thrun said the positions are “real” jobs — “not jobs as a Starbucks barista.”

Some in traditional higher education say that such claims seem cheap or even desperate. But as more upstart education providers offer targeted programs and put more effort into finding jobs for their graduates, could such promises eventually become more common?

Recognizing Risk

For Beth Akers, a fellow at the Brookings Institution, guarantees like Udacity’s are a market solution to temper the risk that students face when they choose to invest in higher education.

“They recognize that risk is something their students, the consumers, are concerned about,” Ms. Akers said. “They are able to take on some of the risk for students, and make it an easier and safer bet for those that enroll at that school.”

Ms. Akers sees the guarantee as an innovation stemming from the need to reduce financial risk in higher education. She likens the offer to universities that guarantee graduation within four years. Colleges that make such a pledge typically offer students who don’t finish in that time span discounted or free tuition for courses they take after that.

Adrian College’s president, Jeffrey R. Docking, called Udacity’s money-back guarantee a gimmick that couldn’t be supported at an institution like his. “It’s not an option that we would entertain either philosophically or economically,” he said. “It’s not feasible.”

But the Michigan college has made unusual efforts to address concerns among students about the rising cost of attendance. Adrian recently began a program, Adrian Plus, that will repay a student’s loans if he or she doesn’t find a job after graduation, or if the job pays less than $37,000 a year. Adrian Plus is available to all new freshmen who have enrolled since 2014.

While elite universities don’t advertise official guarantees and don’t see job training as the core of their mission, Robert Sopko, of Case Western Reserve University, said that their strong reputations mean that there is a high likelihood graduates will land jobs.

ADVERTISEMENT

Mr. Sopko, director of Case Western’s LaunchNet program, which supports entrepreneurship, said that while it is unlikely any college could ever make an across-the-board guarantee, such promises could work for specialized programs in high demand.

A ‘Crisper’ Way

Mr. Thrun defended the Udacity guarantee as a “crisper” way for his institution to persuade students to attend. “Certainly we would like to get more students and increase enrollment. That’s absolutely correct, and we will deliver our promise,” he said. “If other colleges have other philosophies, that’s perfectly fine with me.”

But Mr. Thrun said he hopes other colleges catch on. “I would recommend every college president to think about this,” he said.

Udacity isn’t the first upstart to offer a money-back guarantee. At least one so-called coding boot camp, the Flatiron School, guarantees students in one program a job within 120 days of graduation.

ADVERTISEMENT

The program prepares students only for specialized jobs such as software engineers, full-stack developers, or front- or back-end developers. Jackie Morgan, manager of student development and job placements at the Flatiron School, said the program is job-driven from start to finish, and is designed for successful people looking to change careers.

“What we do is provide a specific training for a specific skill set with the intention of getting a job at the end,” she said. It helps, too, that the school accepts only about 6 percent of applicants.

Join the conversation about this article on the Re:Learning Facebook page.


Questions or concerns about this article? Email us or submit a letter to the editor.

A version of this article appeared in the January 29, 2016, issue.
Read other items in Mapping the New Education Landscape.
We welcome your thoughts and questions about this article. Please email the editors or submit a letter for publication.
Tags
Technology
Share
  • Twitter
  • LinkedIn
  • Facebook
  • Email
ADVERTISEMENT
ADVERTISEMENT

More News

Brad Wolverton
Newsroom leadership
The Chronicle of Higher Education Names Brad Wolverton as Editor
Vector illustration of large open scissors  with several workers in seats dangling by white lines
Iced Out
The Death of Shared Governance
Illustration showing money being funnelled into the top of a microscope.
'A New Era'
Higher-Ed Associations Pitch an Alternative to Trump’s Cap on Research Funding
Illustration showing classical columns of various heights, each turning into a stack of coins
Endowment funds
The Nation’s Wealthiest Small Colleges Just Won a Big Tax Exemption

From The Review

Illustration of an ocean tide shaped like Donald Trump about to wash away sandcastles shaped like a college campus.
The Review | Essay
Why Universities Are So Powerless in Their Fight Against Trump
By Jason Owen-Smith
Photo-based illustration of a closeup of a pencil meshed with a circuit bosrd
The Review | Essay
How Are Students Really Using AI?
By Derek O'Connell
John T. Scopes as he stood before the judges stand and was sentenced, July 2025.
The Review | Essay
100 Years Ago, the Scopes Monkey Trial Discovered Academic Freedom
By John K. Wilson

Upcoming Events

07-31-Turbulent-Workday_assets v2_Plain.png
Keeping Your Institution Moving Forward in Turbulent Times
Ascendium_Housing_Plain.png
What It Really Takes to Serve Students’ Basic Needs: Housing
Lead With Insight
  • Explore Content
    • Latest News
    • Newsletters
    • Letters
    • Free Reports and Guides
    • Professional Development
    • Events
    • Chronicle Store
    • Chronicle Intelligence
    • Jobs in Higher Education
    • Post a Job
  • Know The Chronicle
    • About Us
    • Vision, Mission, Values
    • DEI at The Chronicle
    • Write for Us
    • Work at The Chronicle
    • Our Reporting Process
    • Advertise With Us
    • Brand Studio
    • Accessibility Statement
  • Account and Access
    • Manage Your Account
    • Manage Newsletters
    • Individual Subscriptions
    • Group and Institutional Access
    • Subscription & Account FAQ
  • Get Support
    • Contact Us
    • Reprints & Permissions
    • User Agreement
    • Terms and Conditions
    • Privacy Policy
    • California Privacy Policy
    • Do Not Sell My Personal Information
1255 23rd Street, N.W. Washington, D.C. 20037
© 2025 The Chronicle of Higher Education
The Chronicle of Higher Education is academe’s most trusted resource for independent journalism, career development, and forward-looking intelligence. Our readers lead, teach, learn, and innovate with insights from The Chronicle.
Follow Us
  • twitter
  • instagram
  • youtube
  • facebook
  • linkedin