Education ROI Calculation
Our ROI calculation is a formula we use to determine if an educational program is a positive financial investment for learners.
Before taking out most loans, you confirm the value of what you’re buying. You wouldn’t get a loan for a car without having it inspected, or a house without an appraisal confirming how much that property is worth. We look at the net cost of the program (including tuition amount and lost wages while attending school) and compare that to the expected salary growth — all while factoring in the likelihood of graduation and job placement.*
We believe there is often a disconnect between quality education and good financing options.
We created this model to ensure that everyone involved in the financing process benefits from it — especially the students.
By creating a measurement to gauge how much students can expect to earn from their educational investment, we can hold schools accountable for the education they’re selling, and ensure that we’re helping students succeed by funding them to attend schools where they’re likely to receive better employment opportunities after graduating. This, in turn, makes it easier for students to pay back their loans, which benefits everyone involved!
What we're doing is working
1 Based on 1,279 Climb student graduate survey responses.
2 Based on 227 survey responses in which graduates stated they were unemployed prior to program attendance.
3 Based on 228 survey responses in which graduates informed Climb that they’ve held two different jobs since leaving their program.</>
Our calculation evolves as we collect more data from students and partner schools.
We get information about our partner schools from various public sources and self-reported data from the schools themselves. After we begin working with schools, we often get information directly from students and use that information to supplement the initial data we gathered. This allows us to update our evaluation of programs on an ongoing basis. For the select information used in our ROI calculation that is provided to us by schools, we assess how confident we are in their reporting metrics by assigning ratings to them.
Data informing our calculation
Our proprietary ROI calculation incorporates school, student, and alumni data. We only partner with schools that have been vetted for quality and deliver results for students.
Balancing cost and expected salary
How important is the ROI calculation in determining our partnerships? In a word: very.
We strive to work only with programs that benefit students, so we will only fund a course if it passes our ROI calculation. Not every program will pass the test, and we’ve turned away business because of this. We continue diligently to assess programs throughout our partnership, to ensure that they maintain their quality even after the partnership is formed.