Earning a Yale degree will no longer require moving to New Haven, Connecticut, thanks to an online program for would-be physicians’ assistants that the university plans to launch early next year. The graduate program, developed in partnership with software-as-a-service provider 2U, will grant Master of Medical Science degrees exactly equivalent to those of on-campus students.
“This is a Yale degree,” Lucas Swineford, who oversees the university’s digital strategy, told The Wall Street Journal. Online education, he said, is “coming of age.”
Students will complete the vast majority of their coursework through 2U’s cloud-based platform, with some in-person training at a local medical center.
“We needed the will of a great institution to make these students the real deal, make them equal,” 2U CEO Chip Paucek told Fast Company during an interview at 2U headquarters in Manhattan’s Chelsea neighborhood last fall, describing the company’s origins. “Why should they be second-class citizens?”
The announcement marks a victory for Paucek, who has staked 2U’s success on convincing elite universities to leverage their brands online. In contrast to startups like General Assembly and the Minerva Project, which are attempting to build name-brand educational credibility from scratch, 2U prefers to operate in the background. The company oversees a data science program for Berkeley’s School of Information, a nursing program for Georgetown University’s School of Nursing and Health Studies, and over a dozen other online graduate programs. The universities provide the faculty and course content, and 2U provides nearly everything else, from student recruitment to job placement, in exchange for 65% of tuition dollars. Programs typically become profitable in their fourth year, after 2U has recouped its startup costs.
If regulators approve the Yale program, the university will enroll 12 online students in January, and look to grow to 300-plus online students over the next five years. Online students will pay $83,162 and complete their coursework in 28 months, just like the 40 students attending the program on campus.
Assuming those projections are correct, 2U’s revenues for the program will increase from $648,664 in 2016 to over $16 million by 2020. Numbers like those have won 2U fans on Wall Street; the company has been trading at around $18 per share for the last six months, after debuting on the Nasdaq exchange at $13 per share last March.
Most elite universities continue to tread carefully as they experiment with online learning. Last month, for example, Harvard Business School announced that it would be formally launching its new CORe (Credential of Readiness) program online this summer. For now, at least, CORe is a milquetoast compromise between MOOC and accredited degree: It comprises just three courses, focused on business fundamentals, and grants students a certificate, rather than a diploma. That said, it will still make a multi-million-dollar contribution to Harvard’s bottom line: Bharat N. Anand, faculty chair for online learning at HBS, told Fortune that he expects to enroll 3,000 students, each paying $1,800, this June.
2U is not the only company hoping to woo universities from the ivory tower to the Internet browser with increasingly sophisticated learning interfaces and course management systems. MOOCs like edX are championing a tiered model, in which faculty can serve both on-campus students working toward a degree and online students working toward a course certificate on the same platform. And companies like Canvas, which once focused on helping professors organize syllabuses and administrators manage scheduling, have introduced features that more directly support learning. 2U is arguably the most advanced in terms of finding qualified students and placing them in jobs, with a marketing strategy that uses content sites to drive SEO, or search engine optimization. Teach.com, for example, is a 2U property, managed on behalf of USC Rossier’s online teaching program.
Going forward, 2U will need to find ways to add more programs without alienating its existing partners; Yale would likely not welcome a competing program for physician associates also powered by 2U. The Yale program carefully threads the needle, allowing 2U to leverage its experience operating nursing and midwifery programs without having to knock heads with university administrators.
“These are the longest-standing institutions in our culture,” Paucek says. “New entries in the market are good for online education. But I’ll put my money on Berkeley, I’ll put my money on Georgetown.”