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I've had a stream of questions lately about what's going on with 2U, and my honest answer has been that there isn't much to report. That is itself part of the story.
Last week we at least got something concrete. 2U has laid off staff across the business—I believe the reduction is under 10%. There have been other recent layoffs at 2U, but this one seems somewhat unique in the financially-driven broad-based impact. I asked for confirmation from the company, and a spokesperson provided the following response.
2U is reducing roles across the business as we take further steps to align our costs and operating model with the business we have today. These actions reflect a changing higher education environment, from shifts in how learners choose and pay for education to more deliberate decision-making by our university partners, as well as the choices we are making about how 2U will operate and invest going forward. These are difficult decisions that affect valued colleagues, and we are supporting them with severance and transition assistance. University partnerships and edX remain central to our business, and no business unit is being wound down. We remain confident in the opportunity ahead and are building a more focused, disciplined 2U to serve learners, universities, and employers as their needs evolve.
The layoff also lands about six weeks after Anant Agarwal moved from Chief Academic Officer to "special advisor," which I'll come back to.
The headcount is not the interesting part. 2U's trip through Chapter 11 bankruptcy was, by EdTech standards, well managed—it cleared the debt, kept the university partners, kept edX, and got the company out from under a capital structure that was never going to work. What it did not do was answer the harder question of how 2U would adapt its strategy for the realities of today’s market. Two years on, the company's own explanation for the current cuts is mostly about cost and restraint, ending on the promise of "a more focused, disciplined 2U." Discipline is not a strategy.
The questions I've been getting aren't really about 2U, though—they're about whether anything of significance is happening in the OPM market. Neil Mosley and I spent much of a podcast episode on that question back in May and kept landing on the same word: stale. The OPM market deserves more than a single company update, so this is the first of a couple of posts on where the market actually stands. Starting with three things I think are going on at 2U.
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