About 15 years ago, 2U started working with the University of Southern California to create online degree programs. Since then, they have helped launch and manage 180 other programs for different universities. In 2021, they acquired edX, a MOOC platform, to further expand their services. However, things took a turn for the worse in 2021.
Demand for online courses decreased as students started returning to in-person classes, and changes in the tech industry affected coding boot camps, another part of 2U’s business. On top of that, their degrees and services faced criticism and legal challenges. This combination of factors led to a significant decrease in revenue and an increase in debt for 2U.
As a result, the company filed for bankruptcy under Chapter 11. This process will allow them to restructure their debts, improve their financial health, and continue running their programs without any interruptions. Despite this, critics are using 2U’s situation as an example of the risks in the online program management market.
Advocates are now calling for more regulations and protections for students in case other companies in this market face similar issues. The bankruptcy filings have provided insights into 2U’s financial relationships with universities and how the company has evolved during the pandemic. This event serves as a cautionary tale for the industry.
Overall, 2U’s bankruptcy highlights the challenges faced by companies in the online education sector and the importance of financial stability in such a competitive market. It also underscores the need for transparency and accountability to ensure the continued success of online program management companies and the well-being of students enrolled in their programs.
