The founder of the Princeton Review bet that elite universities would put whole graduate degrees online if someone else did the hard work. John Katzman started 2U in 2008 with Chip Paucek and Jeremy Johnson. 2U paid to build each program and find the students, then split tuition with the school. When it filed to go public in 2014, eight of its nine university partners ranked among the top 75 national universities in U.S. News.

Paying Up Front for Tuition

Most universities had no budget or skill to run a national online program. 2U offered to fund the platform, the marketing, and the student support. In return it took a large share of tuition for years. Its live online classes kept sections small and faces on screen. The model cost a lot at the start of each program and paid off only as students enrolled and stayed. 2U's prospectus estimated its early students would bring in more than $475 million in total tuition.

From edX to Chapter 11

2U priced its IPO at $13 a share in March 2014 and listed on Nasdaq as TWOU. For several years it grew fast and signed many more schools. In 2021 it bought edX, the online course platform started by Harvard and MIT, for $800 million. Growth slowed, new rules on revenue-sharing deals loomed, and the debt from the edX deal weighed on it. 2U filed for bankruptcy in July 2024 and left Nasdaq that September as a private company.

Cover: A Scholar in His Study (Faust), Rembrandt van Rijn. Art Institute of Chicago, public domain. Chosen for a scholar at his desk (learning anywhere).