Built to Suck: The Inevitable Demise of Colleges and How to Save Them
I’ve just gone through the college admissions process for the first time. Both my wife and I are immigrants, so this was the first time we had experienced this incredibly complex new world.
Turns out you basically need a college degree to apply for college!
I always reward ingenuity and the entrepreneurial spirit, so on the upside, there is a cottage industry of counselors, consultants, and tutors making a pretty penny on alpha-parents and their kids, intent on being first to post (or should I say to boast) to social media with their early decision conquests.
For those not aware, colleges in the United States have different ways to apply:
Early Decision: only one college can be selected and the decision is binding
Early Action: you’re notified early of acceptance and non-binding
When Early Decisions are announced, social media lights up with elated students and especially their parents, who flaunt their achievement with absolutely no regard for the students and their families who are bitterly disappointed, dejected, and depressed.
This needs to stop.
There are courses like Kaplan and Princeton that can help improves scores (legally), but this has never stopped parents with money from gaming the system. How many of the five criteria are really game-proof? How many of the essays submitted were really done by the student themselves?
Kids get swept up in this artificial pressure cooker of expectations, going through robotic motions of perceived status. They lose sight of priorities and common sense at the expense of likes and the Common App.
Even the airlines and hotels enjoy making money from on-campus visits. When it comes to touring colleges for your child, why not travel in style and rack up points?
At the end of the rainbow is a pot of gold, only the pot is a big IOU that has them on the back foot, submerging students in debt that they’ll struggle to pay back for the rest of their lives.
According to research from the Federal Reserve, each $1,000 increase in the nation’s debt causes a 1-2% drop in the home-ownership rate of student loan borrowers during their late 20s and early 30s.
With the exception of the top students at the top universities, graduating students are likely going to get entry-level jobs paying nowhere what they need, but hard work, persistence, and elbow grease will eventually see them rising up the ladder.
As they become successful, they’ll hear from their college alumni offices urging them to contribute to fundraising initiatives, scholarships, and financial aid budgets to pave the way for future students.
To me, the college business model is broken.
It’s full of friction, inequality, and inefficiency. It has failed to evolve, and it is not inconceivable, to use the same filter that says “the corporate empire is coming to an end” to signify that U.S. colleges could go the same way.
Perhaps it’s time for them to embrace their heresy and put themselves out of business? This is a concept I have built out and expanded in my book, Built to Suck, and it couldn’t apply more appropriately to colleges. In this case, the ultimate heresy would be to make all colleges free (before a President Bernie does).
Sound far-fetched? It isn’t! I even have a plan how to do it!
Utilizing the Survival Planning Canvas, which I created for Built to Suck and my company the HMS Beagle, I’ve filled out the beginnings of a survival and growth plan. In doing so, I came up with what I think could disrupt the entire industry and fix part of the massive credibility crisis all colleges are going to have to contend with.
Turns out Bernie was right! All colleges should be free, or – at a minimum – costs should be covered. The college would take a 1% equity stake in their graduates’ future earnings and net worth. Of course, students could opt out and go with the status quo: paying now v. over time. Kind of like a lump sum versus annuity when winning the lottery, but in reverse.
This would continue until the student has paid what would have been their full tuition adjusted for inflation and such. Or perhaps it would continue in perpetuity. It could even be adjusted to provide a reduced but steady yearly contribution to the college that would be an automatic philanthropic source of cash flow.
I think this idea is worth exploring in a truly bipartisan fashion. How could either party object to a more educated workforce with a constant source of school funding?
And, as for the admissions scandal, that’s another canvas for another day.