Thinkful's Income Share Agreement + Stipend: What You Need to Know

Table of Contents

• What you need to know:
• Which Thinkful programs are the ISA and Living Stipend available for?
• Is their an ideal student for the ISA?
• How much is the living stipend?
• What is the admissions process for the ISA + stipend?
• What are the eligibility requirements to get an ISA + stipend?
• What are the terms of the ISA and the ISA + stipend?
• Does this ISA option affect Thinkful’s job guarantee?

Thinkful has been offering job guarantees for their immersive courses since 2016, but now the online school is taking it a step further by launching income share agreements and living stipends which students don’t need to repay until they find a job. We sat down with Thinkful co-founder and CEO Darrell Silver to find out how ISAs and living stipends will make the programs more accessible, what the terms and eligibility requirements are, and how students can choose between an ISA and a traditional loan.

What you need to know:

• Thinkful offers two options:
  • A tuition-only income share agreement
  • An income share agreement with an additional living stipend of up to $7500
• Grads start repaying 15% of their salary once they are earning $40,000
• If graduates don’t find a job within 5 years, they don’t have to pay anything
• Students who choose to pay upfront or use a traditional lender are still eligible for Thinkful’s job guarantee.

Thinkful already offered financing with Ascent Funding, why did you decide to launch this living stipend?

It’s what our students were asking for. We conducted a survey of 1400 people who were looking to learn but didn’t enroll at Thinkful. Exactly 94% of them told us that in order to enroll, they would need to cover the income they would lose while studying, and they needed to learn full time. So it was clear to us that we should try offering living stipends.

Why did you decide to launch both an ISA and a stipend?

They serve slightly different needs. An ISA allows someone who doesn’t want a loan obligation and doesn’t want to pay tuition up front, to take a Thinkful program. Students in the Engineering Immersion program really can’t have a job at the same time. So the ISA + Living Stipend appeals to someone who needs to be learning full time, but also needs to supplement their income somehow. 

Which Thinkful programs are the ISA and Living Stipend available for?

The ISA is available for all of Thinkful's immersion courses except Digital Marketing.

• The ISA with a stipend is currently available for students taking the full-time engineering immersion course, and it’s available in Denver, CO, Minneapolis, MN, and Atlanta, GA. From July 15, 2019, it will also be available in Dallas, TX, Los Angeles, CA, and Philadelphia, PA.
• All other programs still have a tuition guarantee. 

Is their an ideal student for the ISA?

It’s definitely not about your background, it’s about your willingness to learn and dedicate the time. Thinkful programs are very beginner-friendly, so we certainly don’t screen on where you went to school or anything like that. We’ve found that the perfect candidate for an ISA is often someone who might have had a bad experience with their student loans, so they are looking for assurance that the bootcamp isn’t going to cost them anything unless they succeed in getting a job. The last thing people want to have is debt if they don’t succeed.

Who is the ideal student to use the living stipend? 

Someone who wants to learn full time but needs the extra income while enrolled. If you’re looking to join our full-time program, but you have family obligations and living expenses which are keeping you from enrolling, then you’re the perfect person for the ISA with Stipend. And that’s most people – most Americans only have $1000 in savings, and they can’t afford to pay for their rent while they are enrolled in school, even if school is free. So they need the living stipend in order to support their education. 

How much is the living stipend?

It’s $7500 over the 5-month program. We’ve been piloting the stipend program for about 10 months, working with students in Oregon and Salt Lake City. We learned that in the cities we are launching in (Denver, Minneapolis, Atlanta), $7500 covers most living expenses, without being so much money that it’s too high of a burden to repay. 

What is the admissions process for the ISA + stipend?

It’s pretty similar. Thinkful already offers a tuition guarantee, so we are already aligned with students in making sure they succeed. We only succeed if you succeed. Our admissions process has been built to make sure that we admit and enroll the folks who are going to succeed.

What are the eligibility requirements to get an ISA + stipend?

There are two eligibility requirements (similar to the Ascent Funding loan). There is a maximum debt load you’re allowed, and you need a minimum credit score as well. Applicants must be US citizens or permanent residents over the age of 21. ISAs (without the stipend) are available everywhere in the US for all immersion courses except Digital Marketing.  For the ISA + stipend, we’re only in those three cities so far, but we will be expanding shortly.

What are the terms of the ISA and the ISA + stipend?

• Graduates have to be earning a minimum of $40,000 for both ISA and ISA + Stipend before they start repaying
• For students who use the ISA + stipend, they pay 15% of their salary over 4 years, 
• For students who use the ISA without stipend, they pay 15% of their salary over 3 years.
• You can’t take the living stipend without taking the ISA.
• The cap, or maximum a student with ISA + stipend will pay is $40,000, 
• The cap, or maximum a student with just the ISA will pay is $28,000
• If a student doesn’t find a job earning $40,000 within 5 years, they will never repay.

What kinds of career support can Thinkful's ISA students expect?

The Thinkful team provides career support for every student regardless of their payment plan. In a lot of ways, implementing the stipend and the ISA expands what we have already been doing with our programs over the past 5 years. 

All of our students receive career support. It’s actually less about “tracking” and more about having a careers team that works with each student at each stage of their education: before graduation all the way through to when they get a job. That involves a mix of learning how best to apply to jobs, how to build their resumes, technical coaching, mock interviews, getting feedback from recruiters, and introductions to our employer network. And that support is what every Thinkful student receives. 

What kinds of salaries and jobs do Thinkful grads land?

The median salary for Thinkful graduates is far higher than $40,000. Only a small amount of students are making less than $40,000. In fact, the average graduate reports a $20,000 increase in salary compared with their previous career. The jobs at that $40,000 salary level are jobs like Software Engineer, Junior Software Engineer, and Web Developer.

How does this ISA partnership with Leif work?

We work with Leif because they are experts. We're not a bank, we don't do the financial work they do with students as well as they can. This includes everything from helping us determine students' eligibility for an ISA, helping students begin making payments once they've landed high-paying jobs, and also being there for the long-term to make sure that if a student's salary or employment situation changes, the payment plan changes accordingly.

Does this ISA option affect Thinkful’s job guarantee?

It’s an expansion of the job guarantee, really. The job guarantee means that if you do the work and don’t get a job, then we’ll give you your money back. The ISA means that if you do the work and don’t get a job, then you will never have to pay. Because we’ve been offering a job guarantee for so long, it’s easy for us to experiment with new offerings like the ISA.

What should students consider when deciding between the ISA and the ISA + stipend?

I would say if you don’t need the stipend, then you shouldn’t take it. But if you’re held back from enrolling because you have ongoing expenses, then the stipend is a good option. You should only take out the payments that you need. It’s very straight forward. 

In neither situation (ISA or ISA + stipend) do you need to repay until you have a qualifying job, but the less you have to repay the better. At the same time, we find that students do better when they are not distracted, so if you have to keep a part-time job in order to afford the program, that’s not the best environment for learning. Often we find that’s the tradeoff students are making – choosing whether to take a stipend or to keep their part-time job. It’s an unfortunate choice, but we recommend the stipend in that situation. It’s certainly the student’s decision based on whether they think they can keep both balls in the air.

What is the difference between taking a loan through like Ascent Funding and using Thinkful's ISA?

Thinkful will provide the same education regardless. We’ve been doing this for six years, we know exactly how our education works, we know exactly how to manage careers, we have a strong employer network, and everyone is part of the same community. 

The difference is:

• If you use an Ascent Funding loan and you don’t succeed, then you still have to repay the loan (unless you get the Thinkful money-back guarantee refund).
• If you use the ISA and it takes you longer to get a job, then you won’t have to repay until that job starts. 
• With the loan, the repayments start upon graduation, whereas with the ISA, the repayments start upon getting the job.
• For a lot of students, the total amount paid over three years ends up being a little higher with the ISA, so there is a tradeoff there. But overall it’s all under the Thinkful guarantee, so it’s not a huge difference from most students’ point of view.

The ISA is a great way to lower risk for students, it’s a great way to increase confidence in the school, and from our perspective, it expands the guarantee we’ve had for three years. And the stipend allows us to open up our programs for more students. So we’re excited about it.

Find out more and read Thinkful reviews on Course Report. Check out the Thinkful website.